Burgundy Finance…Keeping the World Working Together
Burgundy Capital is a private finance company that provides funding for large commercial, infrastructure, and governmental projects.
Organized under the laws of Great Britain, we specialize in private funding, venture capital, and management consulting for institutional clients. Our core competence involves the structuring and capitalization of large-scale commercial and governmental projects. Although we maintain relationships with several of the top 100 banking institutions, we primarily facilitate collateral instruments through Barclays, Scotia Bank, and HSBC.
We have been able to thrive due to the prevailing trends in the asset based, or collateralized, debt industry which has seen a steady increase in capital costs.
The rise of venture capital, and private equity companies, has saturated the market and controlled the amount of interest, or ownership stake, these companies take on various projects. These rising costs continue due to tacit agreements within the industry. At Burgundy Capital, we have the unique ability to raise significant amounts of funding with unparalleled flexibility.
The mortgage crisis of 2008 significantly tightened the reins on the ability of banks to both lend money and to leverage debt. The banking industry now rarely entertains venture or project financing without secure collateralization. Hence, there is an increasing void in project finance without high interest costs or the forfeiture of majority ownership.
Burgundy Capital works with clients on an invitation only basis. While we have access to virtually unlimited capital, and methods of funding, we do not entertain a wholesale approach.
The primary instruments utilized by Burgundy Capital for the purpose of obtaining large sums of capital for project finance are Bank Guarantees (“BG”), standby letters of credit (“SLC’s”) and Original Instrument Documents (“OID’s.”)
SLC’s are a particular form of bank guarantee used by governments and corporations engaging in international commerce. SLC’s are also used to guarantee payment of funds borrowed for infrastructure, land development, and a host of other projects. Many projects are collateralized with the borrower’s working capital, chattel, and real estate property.
Banking institutions typically require additional collateral to extend the type of credit required for large scale projects. SLC’s provide lending institutions with a “standby” guarantee of payment which serves to fulfill a prospective borrower’s collateral obligations. Burgundy deals primarily in projects that require increments of $100 million USD.
Due to the ever-increasing demand for funding, many unscrupulous companies represent that they can obtain capital for borrowers at impractical rates. These contentions are flawed for several reasons. In the first instance, aside from the large number of claims that are entirely misleading, the BG’s and SLC’s that they purportedly obtain rarely, if ever, emanate from top tier banking institutions. Collateral instruments emanating from banking institutions that lack credibility will result in far less funding for the borrower than if the instrument originated from a top tier bank. This inevitably presents a reduced ability for the borrower to obtain funding from the borrower’s banking institution (also called the “receiving bank” since they receive the BG or SLC from the “issuing bank”).
In many instances, the receiving bank will not provide the borrower with any funding. In the end, these purported instruments are rendered useless and ultimately result in a waste of resources. OID’s are also utilized and tailored to a client’s needs. In substance, the OID’s we obtain are similar to SLC’s with longer maturity dates.
The essence of what makes us compelling to entities seeking funding is our ability to provide collateral from top tier banking institutions while minimizing costs.
