This White Paper outlines Everest Assets Group’s (EAG) strategic approach to financing multiple acquisitions through a singular injection of capital, leveraging equity in publicly listed companies as the foundation for sustained growth. Our objective is to build a high-value portfolio of IT and cybersecurity firms, enhancing Net Asset Value (NAV) and positioning EAG for a successful Initial Public Offering (IPO) on the AIM of the London Stock Exchange by 2028-29.
Our strategy focuses on acquiring controlling stakes in publicly listed companies, unlocking off-book assets to significantly boost their valuation, and using the resulting equity as collateral to fund further acquisitions. This financing model allows EAG to continue its aggressive acquisition-driven growth without needing multiple rounds of equity injections.
I. Acquiring Control of a Publicly Listed Company
EAG’s financing strategy begins with the acquisition of operating control of a company listed on the LSE/AIM for £30 million. This target company has a current share price of £0.12 and a Net Asset Value (NAV) of £2 million, but critically, it holds £200 million in off-book assets that have yet to be recognized on its balance sheet.
By acquiring this company, EAG can unlock these off-book assets, bringing them onto the balance sheet, and immediately increasing the company’s valuation to an estimated £100 million. This acquisition provides EAG with a significant equity portfolio, creating substantial value on Day 1 post-acquisition.
II. Unlocking Off-Book Assets
The target company holds a significant amount of off-book assets, including intellectual property, real estate, and long-term contracts that have not been adequately valued in its financial statements. EAG’s acquisition and post-acquisition strategy is focused on recognizing and valuing these assets within IFRS-compliant financial frameworks. The recognition of these assets will have a transformative impact on the company’s balance sheet:
Pre-acquisition NAV: £2 million.
Post-acquisition NAV (with off-book assets recognized): £100 million.
This substantial increase in value positions EAG to use the acquired company’s equity to fund additional acquisitions.
III. Leveraging Equity for Future Acquisitions
Following the acquisition and balance sheet enhancement of the target company, EAG will hold £30 million in equity on Day 1 and up to £100 million once the assets are recognized. This creates a robust financial foundation, enabling EAG to continue executing its acquisition strategy without requiring constant injections of new capital.
Several leading financial institutions have indicated their willingness to lend against EAG’s equity holdings, providing a clear pathway to finance future acquisitions. EAG will secure financing against these assets to fund multiple acquisitions in the IT and cybersecurity sectors, scaling its portfolio through a combination of equity-backed lending and strategic cash flow management.
IV. Lending Institutions and Their Role
To ensure consistent funding for future acquisitions, EAG has engaged in preliminary discussions with the following institutions, all of which have shown strong interest in supporting our strategy through equity-backed loans:
EquitiesFirst: Specializes in equity-backed lending, offering the flexibility to leverage shareholdings in LSE/AIM-listed companies as collateral while retaining economic benefits such as dividends and capital appreciation.
BNP Paribas Commercial Finance: Focuses on asset-based lending for high-value acquisitions and has a proven track record in structuring complex financial deals.
OakNorth Bank: Provides bespoke financing solutions based on equity and future cash flow projections, aligning with EAG’s acquisition model.
HSBC Commercial Banking: Offers secured loans for growth and acquisition strategies, with a specific interest in technology and cybersecurity sectors.
Lloyds Bank: Specializes in financing large-scale acquisitions, with flexible repayment structures that cater to EAG’s growth objectives.
Metro Bank: Offers stock-backed lending with a focus on high-net-worth clients, providing additional flexibility for equity-based financing.
Barclays Bank: Known for financing mergers and acquisitions in high-growth sectors, Barclays offers secured and unsecured loans that complement EAG’s acquisition strategy.
These institutions provide the foundation for EAG’s ability to secure substantial loans using its equity portfolio as collateral, enabling us to continue acquiring high-potential firms without diluting shareholder value through additional equity rounds.
V. Strategic Use of Equity
EAG’s acquisition strategy is centered on the strategic use of equity. By acquiring undervalued companies and unlocking hidden value in their off-book assets, EAG not only enhances its balance sheet but also creates a valuable equity portfolio that can be leveraged to finance future acquisitions. This approach allows EAG to scale efficiently and sustainably, building a diversified portfolio of profitable IT and cybersecurity firms.
This strategy offers a low-risk, high-reward financing model, as equity-backed loans enable EAG to finance acquisitions without overburdening its cash flow or requiring constant capital raises.
The revaluation of the acquired company’s share price following asset recognition further strengthens EAG’s ability to secure additional funding at favorable terms.
VI. Why This Strategy Works
Equity as a Financial Lever: EAG’s ability to leverage the acquired company’s undervalued assets and equity enables it to unlock significant financial resources. With the equity portfolio valued between £30 million and £100 million, EAG can secure substantial loans to finance its acquisition-driven growth strategy.
Institutional Confidence: EAG’s strong equity position and the willingness of multiple lending institutions to lend against these assets provide a solid financial foundation. This ensures that EAG can fund future acquisitions with minimal financial risk.
Sustainable Growth: Instead of diluting shareholder value by raising new equity for each acquisition, EAG’s strategy allows it to use the equity portfolio created from its first acquisition to finance subsequent acquisitions. This creates a scalable and sustainable growth model, attracting institutional and individual investors alike.
VII. Conclusion
EAG’s strategy of leveraging equity for strategic acquisitions presents a powerful model for scaling in the IT and cybersecurity markets. By acquiring undervalued companies, unlocking off-book assets, and using the resulting equity as collateral for future loans, EAG ensures a continuous flow of capital to fuel its acquisition-driven growth. This strategy positions EAG to dominate its target markets while preparing for a successful IPO on the AIM of the London Stock Exchange.
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