Garrigues counsels on $15m financing for LimaBikes
Garrigues Perú has counselled a US private equity fund on a $15 million USD financing for LimaBikes, a motorbike rental startup.
The financing, signed on June 30, was carried out through a private securitization, where, in addition, the structure contemplated certain enhancements, such as a pledge on the assets.
Settlement of the notes took place in August 2022. Trust Sociedad Titulizadora acted as trustee in the transaction. The notes will not be registered under the Peruvian Securities Act or any other securities laws.
This transaction results in the first securitisation of LimaBikes. In addition, the securitisation has been structured as an off-balance sheet transaction in which LimaBikes expects to sell approximately $15 million plus principal balance of motorbike leases (subject to specific criteria) to a securitisation trust and receive the proceeds from the issuance and sale of promissory notes.
Diego Harman, lead partner of the transaction, stated: “This transaction is an exciting first step in integrating LimaBikes’ strong reputation into its long-term strategic goals […] Participation of international private credit funds with this investment strategy (specifically involving fintechs and start-ups) evidences the confidence for the development of this sector in the Peruvian market. We expect several more transactions in this sector, using this interesting financing model, in the near future.”
Practus LLP acted as US counsel to the private credit fund, Bracamonte Haaker & Castellares Abogados acted as Peru counsel to LimaBikes and CCO Investment & Legal Advisors acted as Peruvian counsel to the trustee.
LimaBikes, trade name of Motos Millenium, is a start-up offering motorbike leasing in Peru since 2019. The company offers financial inclusion opportunities to people who normally do not have access to credit from traditional banks, using an assessment system that, through artificial intelligence, analyses the micro-movements of customers’ students and identifies potential defaults.
Among LimaBikes’ future plans, they hope to consolidate the business in Peru and close a first round of investment. After that, they hope to launch their international expansion plan. The countries they see as most attractive are Colombia and Mexico.
Garrigues’ team was led by partner Diego Harman (pictured), with support from principal associate Miluska Gutiérrez, and senior associate Andrea Paiba.
Practus LLP’s team included partners Richard P. Pasquier and John F. Ramirez.
Bracamonte Haaker & Castellares’ team included partner Gonzalo De Bracamonte, counsel Juan Manuel Robles and associate Claudia Oviedo.
CCO Investment & Legal Advisors was represented by partner Claudio Cruces.
