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Equipment financing

Finance all your equipment to ensure the development of your business and your growth.

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Chetwode offers you equipment financing solutions (leasing, sale & leaseback, vendor financing) specifically adapted to industry or logistics, allowing you to carry out your development projects, while respecting your technical and budgetary constraints.

1. What is equipment financing and what are its advantages ?

Equipment finance allows for the investment in or use of new or existing equipment and a rapid response to the need for business growth requirements.

The following instruments are mainly used:

Leasing is a tripartite operation between a company, an equipment supplier and a financial institution. It is a rental contract that is established between the different parties in order to allow a company to benefit from equipment for a predefined period of time without being the owner. The institution purchases the equipment from the supplier. It rents the equipment to the company, and can transfer ownership to the company at the end of the contract (purchase option).

Sale and leaseback is a two-party transaction between a company and a financial institution. At the end of the contract, the asset ownership reverts to the company.  The company sells one or more pieces of equipment that it owns and then leases them back for a period agreed by both parties. It therefore retains the use of the equipment in return for a rental payment.

Vendor finance is a financial arrangement that allows a manufacturer or seller of equipment to offer a financing solution to its customers. The aim is to facilitate the sale of the equipment it produces.

Who is equipment financing for ?

At Chetwode, equipment financing is aimed at European SMEs/ETIs mainly based in the Euro zone (France, Germany, Spain, Benelux, plus the UK). This financing is available with a maturity of 3 to 7 years and a minimum financing amount of €3M (dependent on our experts’ appraisal).

What are the advantages of using equipment financing ?

Equipment financing allows a company to retain (leasing) or generate (sale and leaseback) cash. This cash can be used to refinance debt, support working capital, make acquisitions, expand internationally, or support the energy transition. In addition, these operations can offer certain tax and accounting advantages for companies.

Separately, vendor financing improves the sales of the company manufacturing the equipment. Furthermore, it provides a financial solution to its customer in order to conclude the sale quickly. This in turn improves customer loyalty, reduces the risk of default, and improves the sales cycle.

What types of equipment are funded ?

Machine tools

Transport

Plastic injection lines

Machining centres (milling, turning...)

Bottling lines

Industrial equipment

Logistics equipment

Equipment financing machine

What are the eligibility criteria for equipment ?

  • Strategic and low obsolescence
  • Can be used or repurposed in related industries
  • Well maintained
  • Attractive and liquid secondary market
  • Resale market value (FMV) > the financing sought (for existing assets)

Meet our teams

“When two forces are joined, their effectiveness is doubled” – Isaac Newton

Our team

Why opt for sale and leaseback when you own your industrial equipment ?

The biggest advantage of sale & leaseback is to generate cash with assets already on the balance sheet. At Chetwode, our experts have a thorough knowledge of the industrial ecosystem and will find value in your assets, even those that are fully depreciated on the balance sheet.

How do you set up a leasing or sale and leaseback agreement ?

The implementation of this scheme is based on a tri-criteria analysis:

  • Analysis of the asset in terms of the value of the equipment, its liquidity and its strategic nature
  • Analysis of the credit quality of the lessee (corporate)
  • Structuring of the transaction to compensate for the risk areas of the transaction (financing ratio, amortisation rate, assessment of the remarketing period, etc.)

Once the analysis has been carried out and approved, the contract is set up as follows

  • Signature of the lease contract between the company and the financial institution accompanied by a promise to sell at a predefined cost (residual value)
  • The lease begins upon receipt of the equipment with the signing of the acceptance report
  • The financial institution remains the owner throughout the contract until the residual value is paid
  • The company (lessee) maintains the equipment for the duration of the contract

What is a mortgage or collateral loan in equipment finance ?

In addition to leasing and sale & leaseback, two other options are available to the borrower :

  • The mortgage is a loan secured by the equipment owned by the business. In the event of default, it allows the financial institution to seize the assets and sell them in order to recover the remaining amount of the loan
  • The pledge loan allows a company to secure a debt with a financial institution by assigning an asset it owns as collateral, while retaining its use. In the event of default, the financial institution can decide to sell the asset or obtain ownership of it

2. Why choose Chetwode for your equipment financing ?

An expert in the field

Chetwode has been an expert in equipment finance since 2003. We have supported numerous projects and completed over one billion in transaction volume with an average transaction size of €6 million.

Why us ?

  • First of all, we have a network of privileged relationships with numerous investors in France and abroad
  • Secondly, we are a team of financial experts ready to listen to you and offer financial engineering tailored to your needs
  • With experts with over 30 years of experience in industrial asset valuation
  • And, we have completed 1 billion euros in transaction volumes since the creation of Chetwode

Our equipment financing offer

If your equipment has been around for some time: Sale & leaseback

If your equipment is new: Leasing 

With a pledged loan or a mortgage

Locations

France, Belgium, Spain, Netherlands, Germany and Luxembourg

Minimum amount

From €3M of volume financed annually

Maturity

3 to 7 years depreciable

Do you have a project?
We have the solution!

Contact us
Spécialiste européen du financement industriel
Spécialiste européen du financement industriel
  • +33 (0)1 84 79 39 49
  • contact@chetwode.fr
  • 58 bis rue La Boétie, 75008 Paris, France

About CHETWODE

Chetwode specializes in strategic industrial asset financing (production equipment, inventories…) and has arranged more than 150 equipment financing transactions for a total amount of nearly 1 billion euros.

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