Business Activities
Babcock & Brown is involved in a diverse range of investment-related and advisory activities.
- Advisory assignments that do not involve the deployment of Babcock & Brown capital or the management of investments on behalf of clients;
- Investment Management activities associated with managing investments for clients and the Group's operating leasing business. These may include investments where Babcock & Brown's own capital is deployed on a short-term basis as part of a warehousing facility, or prior to the syndication of the investors or investments or the creation of some other investment product; and
- Principal Investment activities associated with investment of Babcock & Brown's own capital (both debt & equity) or asset trading, excluding those classified as Investment Management.
Advisory
Babcock & Brown has a long history of acting in the following roles:
- Advisor and arranger of sophisticated leasing, project financing and structured finance transactions
- Private placement agent for debt and equity funding of such transactions
- Financial advisor on acquisitions and restructurings
Babcock & Brown is recognised as a leading advisor in the fields in which it specialises, as demonstrated by its receipt of numerous industry awards and the quality and depth of its client base and level of repeat business.
Investment
Babcock & Brown's investment activities are focused on the creation, syndication and management of investment products for itself, as a principal, and for its investor clients. These clients include wholesale investors such as multi-national financial institutions, charitable foundations, and high net worth individuals, as well as retail investors through publicly-listed vehicles or financial products offered by Babcock & Brown's retail distribution partners.
Babcock & Brown has completed investment transactions as an equity investor, mezzanine lender, project developer, fund sponsor, and lease portfolio manager.
Babcock & Brown's investment activities can be segmented into the broad categories outlined below:
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Arrangement / Syndication
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- Babcock & Brown identifies an investment, negotiates as a principal, arranges financing but syndicates equity to third-party investors prior to final commitment and financial close
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- Acquisition advisory fees
- Debt/equity arrangement fees
- Development fees
- Equity syndication fees
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Underwriting
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- Babcock & Brown commits capital to underwrite the transaction and/or actually deploys funds to complete the acquisition with syndication / selldown of the equity thereafter. Includes bridge financing where Babcock & Brown provides a short-term loan to complete a transaction prior to refinancing with longer-term funding sources
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- Underwriting fees
- Mark-up on investment upon syndication
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Investment / Asset Management
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- Babcock & Brown manages assets and provides other services post-acquisition (typically following an equity syndication or advisory assignment), including asset maintenance / upgrades, financial reporting and asset sales
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- Recurring management fees
- Refinancing
- Carried interest / profit sharing / performance fees upon asset disposition (sale, remarketing etc.)
- Directors fees
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Principal Investment
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- Babcock & Brown deploys capital in transactions, often with co-investors or in conjunction with an equity syndication
- Babcock & Brown has completed transactions as both an equity and a debt investor
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- Income returns (dividends, interest income)
- Development profits
- Proceeds upon sale of assets
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