DUKAP successfully arranges € 28 million working capital financing for VPH

12. August 2022

DUKAP successfully arranged the financing for vph, a medium-sized wholesale company for paper and other printing requirements. An interest rate hedge (interest swap) was concluded already before taking the final loan decision in view of rising market interest rates.

Following a crisis in the industry at the end of the 2^nd part of the COVID-19 crisis and during the Ukraine crisis with rising interest rates and other costs, DUKAP successfully advised on the financing of working capital in the amount of € 28 million for a medium-sized wholesale company.

In a first step, the sustainable viability and profitability of the company had to be presented against the background of the crises and the fundamental willingness of the approached banks to provide such financing needed to be clarified. Afterwards, and despite the fact that a final loan decision had not yet been taken, DUKAP discussed interest rate hedging with the banks by means of an interest rate swap as a result of the massive increase in market interest rates and, simultaneously assisted in obtaining the loan decision and preparing the contractual documentation for the individual loans.

The financing was provided as parallel loans from Deutsche Bank and the local savings bank, divided into € 20 million amortising loans (10-year term, 66% amortisation during the term) and a further € 8 million as working capital credit line.