Catalytic Capital Action Initiative

AUTOEASE GROUP SERVICES

AUTOEASE GROUP has recognized and attended its clients’ changing financial needs with a large number of high-quality products and services. Our aim is to help each of our clients and meeting their needs. We strive to build ongoing relationships based on the highest levels of integrity, service, and performance.

Our Market Sectors:

•                 Private Sector Institutions and Public Sector Entities: we move to cover the demands of our institutional investors including personal funds, foundations, shareholders, JV Partners, and public sector entitles to cover their capital needs.

•                 Companies & Corporate Entities: our professionals understand the needs of different companies and corporates and we know how to help them to run their needs.

•                 Investment Advisors and Facilitators: we tailor services and solutions carefully to match different specific needs; merging the trusted industry names with cutting-edge technology, our products and services aimed to reach the future vision of different customers’ businesses.

•                 International Clients: with more than several billions in assets under our shareholders & coop partners in management and private funding programs, Autoease Group is constantly at the vanguard in creating pioneering and effective speculative solutions for clients all over the world.

SERVICE DELIVERY METHODOLOGY

AUTOEASE GROUP is offering Advanced Strategies for Investment Management of Projects Our Market Sectors:

•                 AUTOEASE GROUP advanced strategies are widely known among the alternative asset managers. We have earned a good reputation for focused due diligence, portfolio construction, risk management and client services.

•                 Private Equity: AUTOEASE GROUP private equity finance offers both direct investment and fund in funds program, allowing the borrowers & investors the unique opportunity to divide their investment in their projects as they see fit. Our aggressive advantages fabricated in our strong experience, preferred access to deal flow, and our highly chosen procedure.

•                 Currency Management: AUTOEASE GROUP currency management business specialized in controlling currency rate fluctuation risk for institutional clients worldwide. Our submissive active and full nonrecourse return programs are geared among the most innovative in the industry.

•                     Institutional Property Based Direct Investment Programme (Catalyst Capital Programme/ALS (Advanced Loan System)/IFDBS (Innovative Finance Distribution and Benefit System/PI2 (Private Investor for Public Infrastructure)): AUTOEASE GROUP direct investments program provides institutional investors with access to compelling direct investment opportunities in the property/ asset-based market investment opportunities. We look forward to generate attractive returns on a risk adjusted basis by targeting only such lucrative opportunities in all phases of the asset’s life cycle.

The Business Model

The AfroRapid Express project or Africa Hub Initiative Project is to be financed via the innovative Private Investment for Catalyst Capital Programme coupling Public Infrastructure (PI2) Model. In contrast to the PPP (Public Private Partnership) concept, the PI2 Model foresees that an infrastructure project is launched as a private or public initiative but is financed to 100% by private investors. The following are some of the advantages of a PI2 project.

●            All planning, construction and operational costs are covered by the operational revenues.

●            Premium public infrastructure is made available without demands on taxpayer funding.

●            Since construction and operations are carried out by the same private organisation(s), the life-cycle costs can be optimised. Government organizations support a PI2 Project in partnership with the private companies and investors as follows:

1.           Issue approvals, permits and licenses

2.           Provide ring-fenced financial backing deposit called Catalyst Capital which will not be used also be retained and support for land acquisition.

A PI2 Project differs from a Public Private Partnership (PPP) Model in that it is launched by a government organisation which then looks for private investment partners who generally provide partial financing for the project.

The PPP model has been utilized in several transport infrastructure projects worldwide in the last decade, for example, in the Øresund Rail/Road project in Denmark /Sweden, in the HSL Zuid High-Speed Rail project in the Netherlands, the Diabolo Rail project in Belgium and the Portugal High Speed Rail project.

However, conflicting political interests within PPP projects have often led to serious problems in the construction and operation of the given infrastructure.

The PI2 Model is a new approach to infrastructure financing and is currently being considered for other public infrastructure projects around the world, such as the construction of new railway lines and airports.

PRESIDENTIAL POWER INITIATIVE

Understanding Zimbabwe’s Presidential Power Initiative (PPI)

The Presidential Power Initiative (PPI) is a strategic and systematic approach to solving Zimbabwe’s perennial problems of unreliable and inadequate electricity supply. Even with an installed power generation capacity of ~26.6GW, there’s a less than 2GW of operational capacity in the nation’s grid, thereby putting the majority of the 15m population at the mercy of more expensive and polluting alternative generation sources. 

Nation XYZ PPI Pre-engineering Contract

MAN Energy, in partnership with MAN Energy & Autoease Energy Solutions & Mozweli, will shortly commence work on the Presidential Power Initiative (PPI), which will upgrade the electricity network to achieve operational capacity of 25,000 megawatts (MW) from the current average of around 1,750 MW, through a series of projects spanning three phases.

 ~AUTOEASE GROUP~ ~MAN Energy~

~Wäřťšiľä Corporations~

~Siemens Energy~

PRESIDENTIAL ECONOMIC DEVELOPMENT INITIATIVE (PEDI), PRESIDENTIAL POWER INITIATIVE (P2I) AND PRIVATE INVESTORS FOR PUBLIC INFRASTRUCTURE coupled with Catalyst Capital Programme for Structured Finance Programme with Debt Expulsion Programme and Debt Free Projects Funding Programme.

Let's push to get the Presidential Economic Development Initiative (PEDI), President Power Initiative (P2I), PI2 Model coupled with Catalyst Capital Programme for Structured Finance Programme with Debt Expulsion Programme and Debt Free Projects Funding Programme for Africa Hub Initiative Programme in Nation XYZ.

Structured Finance

Structured Finance is a complex form of financing, usually used on a scale too large for an ordinary loan or bond. Collateralized debt-obligations, syndicated loans and Mortgage-Backed Securities – the C4 behind the 2008 financial crisis – are all examples of Structured Finance.

When it comes to financing a transaction, there are ‘normal’ or ‘vanilla’ types of financial instruments widely available on the market. These are instruments such as a mortgages or overdrafts and look at the credit strength of the borrower.

However, there are borrowers in the market with unique requirements. With unique borrowers, comes a unique financing instrument. Structured finance refers to an instrument which helps dampen risk when applied to securitizations of various assets.

It is often perceived as the packaging up of receivables, however when we usually look at structured finance it is in relation to lending to borrowers through structures, and less about focusing on the packaging of debt.

The aim is to create situations in order to provide non-flow financing solutions and structured risk mitigation products for clients when looking at a number of industries and classes of assets.

 Why is Structured Finance important?

One reason behind Structured Finance’s importance is because of the parties involved. Large institutions such as Banks participate in the use of structured finance, which means the sums that are made available and circulating the economy through the process are massive.

An example – if we mute the effects that the 2008 financial crisis had on the world, we can see that mortgage-backed securities were bought by the National Reserve for roughly $38billion.

Consequently, through no fault of the basic concept, MBS’s crippled the American economy along with many others however it also (to begin with) generated large surpluses of money.

Why would you use structured finance?

Structured finance can aid companies restructure debt, make savings on repayments, and free up working capital to make cash work as efficiently as it can do. Furthermore, it is often useful when a company operates in different jurisdictions and trades globally.

Structured Finance - Explained

What is Structured Finance?

Written by Jason Gordon

Updated at April 16th, 2022

Table of Contents

Ø  What is Structured Finance?

Ø  How Does Structured Finance Work?

Ø  Significance and Benefits of Structured Finance

Examples of Structured Finance Products

What is Structured Finance?

Structured finance is a type of finance specifically designed for large corporations with unique or complicated financial needs that surpass the standard financial products available for firms. In order to match the financial needs of large corporations, structured finance was established to produce a greater financial instrument. Structured finance is more complex than ordinary financial instruments offered to corporations such as loans. Example of financial instruments categorized as structured finance are collateralized bond obligations (CBOs) and collateralized debt obligations (CDOs).

How Does Structured Finance Work?

Structured finance is specifically for large corporations with sophisticated financial needs. While borrowers with less need can access other financial instruments such as loans, large corporations that have needs that simple loans cannot solve can access structured finance. Not all lenders or financial institutions offer structured finance, it typically entails complicated transactions before it can be completed.

Significance and Benefits of Structured Finance

Due to the heavy financial needs of businesses that go for structured finance, this type of finance is not handled by all lenders. Traditional lenders are the categories of lenders at the forefront of structured finance. One major benefit of structured finance is that it provides huge financing for business with extensive and sophisticated needs, this type of finance is not accessible through conventional financial instruments such as simple loans. Unlike standard loan that is flexible and transferable, structured finance cannot be transferred.

Structured finance helps businesses manage their leverage and risk, expand their business reach and also access structured financial instruments.

 Examples of Structured Finance Products

Collateralized bond obligations (CBOs), collateralized debt obligations (CDOs), synthetic financial instruments, collateralized mortgage obligations (CMOs), hybrid securities and credit default swaps (CDSs) are common examples of structured finance instruments. These products can only be accessed when a standard loan is insufficient to cover the financial needs of a corporation. Hybrid securities are formed through securitization, this means the combination of financial assets birth hybrid securities. Securitization is likened to structure finance; an example of securitization is a mortgage-backed security (MBS). 

CATALYTIC CAPITAL

EXECUTIVE SUMMARY

The amount of capital in impact investments targeting both measurable, positive impact and market-rate, risk-adjusted returns has increased substantially over recent years.

This growth has spurred greater recognition that capital is also needed across a broad spectrum of risk return profiles if impact investing is to achieve its full potential in addressing the world’s most pressing social and environmental issues.

Catalytic capital is critical for enabling impact investing to continue to drive deep impact, reach new sectors and geographies, and mobilize the trillions of additional private sector investment needed annually to achieve the UN Sustainable Development Goals (SDGs).

•                     The accompanying report aims to provide a broad overview of the state of practice for catalytic capital and, in so doing, create a foundation for existing and potential investors to expand and improve on their use of this important tool.

•                     We define catalytic capital as debt, equity, guarantees, and other investments that accept disproportionate risk and/or concessionary returns relative to a conventional investment in order to generate positive impact and enable third-party investment that otherwise would not be possible.*

•                     The report introduces the Pathways to Impact framework, which seeks to guide investors who deploy catalytic capital in a variety of contexts in clarifying the rationale for their catalytic investments. The framework builds on the work of others, including the MacArthur Foundation and the “Impact Investing 2.0” research by Clark, Emerson, and Thornley (2013), to help investors articulate, on a consistent and comparable basis, the forms of risk or return concession included in the investment structure (e.g., a subordinated position or long/uncertain duration); the roles catalytic capital is expected to play in supporting the investee (e.g., seeding early-stage innovations or scaling impact business models); and the specific uses of that capital by the investee (e.g., building track record or leveraging additional investment).

•                     Typical catalytic capital investors are driven by their mission, values, or an investment mandate that requires them to prioritize impact and include charitable foundations, public development institutions, family offices and high net worth individuals, and select corporations and corporate foundations.

•                     Capital willing to accept disproportionate risk and/or concessionary returns is in short supply and can have market-distorting effects if not deployed appropriately.

•                     Evaluating potential positive and negative impacts of catalytic capital (including its built-in financial concession and the activities it supports) is essential to its effective use.

•                     Catalytic capital plays a critical role in filling financing gaps for impact enterprises that conventional capital cannot.

The report synthesizes prevailing research and practices and thereby aims to inform and inspire greater use of catalytic capital globally.

*Though grants can also be important catalytic instruments, the focus of the analysis in the report is investment capital.

CATALYTIC CAPITAL: PATHWAYS TO IMPACT

Catalytic capital accepts disproportionate risk and/or concessionary return to generate positive impact and enable third-party investment that otherwise would not be possible.

What Are Environmental, Social, and Governance (ESG) Criteria?

Environmental, social, and governance (ESG) criteria are a set of standards for a company’s behavior used by socially conscious investors to screen potential investments. Environmental criteria consider how a company safeguards the environment, including corporate policies addressing climate change, for example. Social criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. Governance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights.

 KEY TAKEAWAYS

Environmental, social, and governance (ESG) criteria are used to screen investments based on corporate policies and to encourage companies to act responsibly.

Many mutual funds, brokerage firms, and robo-advisors now offer investment products that employ

 ESG criteria.

ESG criteria can also help investors avoid investment losses when companies engaged in risky or unethical practices are held accountable.

The rapid growth of ESG investment funds in recent years has led to claims that companies have been insincere or misleading in touting their ESG accomplishments.

How Environmental, Social, and Governance (ESG) Criteria Work

      Investors have, in recent years, shown interest in putting their money where their values are.

      As a result, brokerage firms and mutual fund companies have started offering exchange-traded funds (ETFs) and other financial products that follow ESG criteria. Robo-advisors including Betterment and Wealth front have promoted these ESG-themed offerings to younger investors.

      ESG criteria are also increasingly informing the investment choices of large institutional investors such as public pension funds. According to the most recent report from US SIF Foundation, investors held $17.1 trillion in assets chosen according to ESG criteria at the end of 2019, up from $12 trillion just two years earlier.

      ESG investing is sometimes referred to as sustainable investing, responsible investing, impact investing, or socially responsible investing (SRI). To assess a company based on ESG criteria, investors look at a broad range of behaviors and policies.

      58% The share of respondents to a survey by Investopedia and Tree hugger who indicated increased interest in ESG investments in 2020. 19% reported using ESG considerations in selecting investments.

Types of Environmental, Social, and Governance (ESG) Criteria.

ESG investors seek to ensure the companies they fund are responsible stewards of the environment, good corporate citizens and are led by accountable managers.

Environmental

      Environmental criteria may include corporate climate policies, energy use, waste, pollution, natural resource conservation, and treatment of animals. The criteria can also help evaluate any environmental risks a company might face and how the company is managing those risks.

      Considerations may include direct and indirect greenhouse gas emissions, management of toxic waste, and compliance with environmental regulations.

      Human influence is unequivocally to blame for the warming of the planet and some forms of climate disruption are now locked in for centuries, according to a report from the U.N. Intergovernmental Panel on Climate Change.

 "This report must sound a death knell for coal and fossil fuels before they destroy our planet," said United Nations Secretary-General António Guterres.

Social

Social criteria look at the company’s relationships with stakeholders.

      Does it hold suppliers to its own ESG standards? Does the company donate a percentage of its profits to the local community or encourage employees to perform volunteer work there?

      Do workplace conditions reflect high regard for employees’ health and safety? Or does the company take unethical advantage of its customers?

Governance

      ESG governance standards ensure a company uses accurate and transparent accounting methods, pursues integrity and diversity in selecting its leadership, and is accountable to shareholders.

      ESG investors may require assurances that companies avoid conflicts of interest in their choice of board members and senior executives, don't use political contributions to obtain preferential treatment, or engage in illegal conduct.

 Special Considerations

Investment firms following ESG criteria often set their own priorities. For example, Boston-based Trillium Asset Management, with $5.6 billion under management as of December 2021, uses a variety of ESG factors to help identify companies positioned for strong long-term performance.

 The criteria are set by analysts who identify the relevant issues facing specific sectors, industries, and companies. Trillium's ESG criteria preclude investments in the following:

Companies that operate in higher-risk areas or have exposure to coal or hard rock mining, nuclear or coal power, private prisons, agricultural biotechnology, tobacco, tar sands, or weapons and firearms.

Companies involved in major or recent controversies over human rights, animal welfare, environmental concerns, governance issues, or product safety.

In contrast, Trillium looks for investments meeting the following ESG criteria:

■ Environment

■ Publishes a carbon or sustainability report

■ Limits harmful pollutants and chemicals

■ Seeks to lower greenhouse gas emissions

■ Uses renewable energy sources

 Social

¤ Operates an ethical supply chain

¤ Supports Human rights and encourages diversity

¤ Has policies to protect against sexual misconduct ¤ Pays fair wages

Governance

◇ Embraces diversity on board of directors

◇ Embraces corporate transparency

◇ Someone other than the CEO is chair of the board

◇ Pros and Cons of Environmental, Social, and Governance (ESG)

Criteria

In years past, the socially responsible investor was assumed to be sacrificing self-interest to some degree by avoiding some investments based on non-financial criteria. After all, tobacco and defense, two industries avoided by many ESG investors, have historically produced well-above-average market returns.

More recently, some have argued that, in addition to their social value, ESG criteria can help investors avoid the blowups that occur when companies operating in a risky or unethical manner are ultimately held accountable for its consequences. Examples include BP's (BP) 2010 Gulf of Mexico oil spill and

Volkswagen's emissions scandal, which rocked the companies' stock prices and cost them billions of dollars.

As ESG-minded business practices gain more traction, investment firms are increasingly tracking their performance. Financial services companies such as JPMorgan Chase (JPM), Wells Fargo (WFC), and Goldman Sachs (GS) have published annual reports that extensively review their ESG approaches and the bottom-line results.

The ultimate value of ESG criteria will depend on whether they encourage companies to drive real change for the common good, or merely check boxes and publish reports.

 That, in turn, will depend on whether the investment flows follow ESG criteria that are realistic, measurable, and actionable.

 Understanding MSCI ESG Ratings

MSCI ESG ratings are a comprehensive measure of a company’s long-term commitment to socially responsible and environmental, social, and governance investment standards.

 What Is a Green Fund?

Green funds invest only in sustainable or socially conscious companies while avoiding those deemed detrimental to society or the environment.

 Impact Investing Definition

Impact investing aims to generate specific beneficial social or environmental effects in addition to financial gains.

Sustainability Definition

Sustainability focuses on meeting the needs of the present without compromising the ability of future generations to meet their needs. 

 Social Entrepreneur

A social entrepreneur is a person who pursues an innovative idea with the potential to solve a community problem.

OUR EXPECTATIONS/TARGETS

🏁 Wherever there's going to be each Hydrogen Power Generation setup it's going to be Presidential Economic Development Initiative Programme creating 100,000 jobs. Because there's going to be a Shopping Mall, Hospital, Clinics and a lot of development including Roads Development.

💠 Within 5 months once implemented there's going to be largest joy. Have also started engaging Siemens Energy, Wäřťšiľä Power Generation Construction Company and MAN Energy SA in Dubai and South Africa to prepare for the Power and Economic Development Project.

This article further introduces an innovative funding solution (Catalyst Capital Programme coupling PI2 Model (Private Investors for Public Infrastructure) offered to Sigma Mercantile by our overseas partners, for raising funding for projects.

The following transaction overview describes the purpose and process.

Two criteria are required to be fulfilled in order for us to be able to assist a project owner, and for a project to qualify for the funding mechanisms to which we have access:

■ The project must be classified as a qualifying project, as defined;

■ The project owner must be able to provide, or have access to, Catalyst Capital as further described below.

BENEFITS

On the basis that a project will contribute to one or more of the following, the project would be considered a qualifying project, as defined:

♤ social upliftment;

♤ job creation;

♤ job retention;

♤ community and economic rejuvenation;

♤ knowledge and skills transfer;

♤ health initiatives, disease control or primary health care;

♤ building of accommodation to replace slums, house government employees, students, etc;

♤ provision of clean water;

♤ provision of sanitation;

♤ provision of power (including alternative energy sources such as hydro, hydrogen, hybrid, Tetra power, Wireless Power, solar and wind generated power);

♤ provision of education and related educational facilities;

♤ the creation of infrastructure required to support the specific project infrastructure in the form of Ground

Transportation (Railway and Highways), Aerospace (Airports and Airlines), Aerotropolises, Data Cities, Smart Tourism Solutions and Agri City Projects, Smart Cities, housing, utility and other community related assets (such as, inter alia, schools, libraries, and primary health care facilities),