14.4.2020

Open Dialogue Is the Key to Weathering a Financing Crisis

The global emergency and economic downturn are posing serious financing challenges to many companies. The best way to weather this crisis is to take an active and open approach to avoiding and dealing with the fallout of these challenges.

The first thing on any company’s to-do list should be securing liquidity. Many companies are preserving their cash assets and looking to cash in whatever assets they can.

Many companies are also taking a hard look out outgoing cash flows. Excess costs are being eliminated and planned investments are being postponed. A simple but good piece of advice is to pay close attention to your invoicing and maintain a rapid circulation of invoices, as this can help reduce your credit loss risk. You can also negotiate with your financiers on postponing loan payments.

When in the middle of the storm, it is important to still try to take a long view. If ever there was a time to analyse your company’s financing agreements and how they will be impacted by changes in your operating environment, it is now. As your top priority, I would advise checking what kind of financial covenants are in your loan agreements—and whether you will be able to comply with them. Depending on your covenants, 2–3 bad months now could continue to cast a shadow well into next year.

Maintaining an open dialogue with your financiers will improve your company’s ability to make it through this crisis. When your financiers have a clear picture of situation, it will be easier for them to see any problems in advance and agree on what to do. Maintaining trust is the key.

It is important to remember—just as in the financial crisis—that trying to hide things helps no one. If you were already having trouble in your business, you have to face up to that and resist the urge to fold them into any problems caused by the coronavirus pandemic. The few weeks of experience we’ve now had has already proven that this is the best way forward.

Latest references

We advised OP Corporate Bank plc in a real estate financing arrangement relating to DHL Express logistics centre under construction near Helsinki Airport. In the arrangement Nrep (acting on behalf of NSF III Fund) and Pontos Group acquired Finavia’s stake of DHL Express logistics centre under construction. LEED Platinum certification will be applied for the project, and as a result of the certification, the facility is contemplated to qualify as a green loan after the construction completion date.
Case published 12.3.2025
We advised Gasum in chartering a new LNG and bio-LNG bunker vessel. The vessel called Celsius will serve Gasum’s customers starting 2027. The investment is part of Gasum’s strategy to secure the availability of LNG and bio-LNG to its customers in the Northwestern European area as demand increases in the coming years. Gasum is a Nordic gas sector and energy market expert. Gasum offers cleaner energy and energy market expert services for industry and for combined heat and power production as well as cleaner fuel solutions for road and maritime transport. The company helps its customers to reduce their own carbon footprint as well as that of their customers. Sirius is a Swedish shipping company founded by the Backman family. Sirius operates 11 product/chemical tankers and 2 LNG tankers and has a further 3 product/chemical tankers under commercial management.
Case published 11.3.2025
We advised Neste as it signed a EUR 200 million bilateral green term loan agreement with Skandinaviska Enskilda Banken AB (publ). The proceeds of the loan will be used to finance eligible assets and projects in accordance with Neste’s Green Finance Framework. The loan has a tenor of five years. Neste published a renewed Green Finance Framework in February 2024 to align future financing activities with market best practices and standards. In addition to renewable and circular solutions, Neste’s renewed framework includes renewable energy as an investment category. Longer term actions on Neste’s climate roadmap include scaling up new technologies and innovations, with focus on renewable hydrogen. Renewable hydrogen and other new technologies are estimated to have a reduction potential of 20% or more of the 2019 scope 1 and 2 emission baseline by 2030.
Case published 21.2.2025
We advised a financier consortium including OP Corporate Bank plc, Nordea Bank Abp, and Skandinaviska Enskilda Banken AB in a leveraged financing arrangement for Vexve, a company owned by DevCo Partners Oy. The financing included EUR 143 million acquisition, refinancing and other facilities for, among other things, the financing of Vexve’s acquisition of Denmark-based Frese A/S, a leading manufacturer of dynamic balancing valves for hydronic networks. Vexve’s combined turnover after the completion of the transaction will be ca. EUR 200 million. Vexve is the leading European provider of valve solutions for the energy sector and selected energy-intensive industries.
Case published 7.2.2025