Sidley Austin acted for CBC Group in Unique Hybrid Financing Transaction with Natixis Corporate & Investment Banking

Sidley Austin acted for CBC Group in Unique Hybrid Financing Transaction with Natixis Corporate & Investment Banking

R-Bridge Healthcare Fund (RBF), a fund managed by healthcare-focused asset management firm CBC Group, has received a US$120 million "hybrid" financing from Natixis Corporate & Investment Banking through its Hong Kong branch. Sidley Austin, an American multinational law firm, provided legal advice to RBF on the transaction.

Hybrid fund financing is relatively new in the Asian market, making this deal a significant milestone.

Unlike traditional capital call facilities, hybrid financing combines elements of both capital call financing (which "looks up" to undrawn investor capital commitments) and net asset value (NAV) financing (which "looks down" to the value of the underlying assets of the fund for recourse). This unique approach offers greater flexibility, as the fund can utilise the facility not only when there are undrawn and recallable investor capital commitments, but also borrow against the NAV of the investments made.

Given the complexity of the hybrid financing, DLA Piper had to address concerns related to determining the borrowing base methodology early on and negotiate a bespoke covenant package. This required a deep understanding of the legal framework of the fund and its underlying assets.

Since the fund's underlying assets were located in multiple jurisdictions, and security documents were subject to diverse governing laws, the law firm collaborated seamlessly with its offices in London, Singapore, and the United States to ensure a smooth and timely closing.

CBC Group, with its headquarters in Singapore, focuses on building platforms, buyouts, private credit, ventures, and real estate in the healthcare sector. This includes pharmaceuticals, biotech, medical technology, and healthcare services. R-Bridge Healthcare Fund (RBF), managed by CBC Group, offers tailored, non-dilutive financing to leading biotech, biopharma, medical technology, and healthcare services companies. This financing is backed by healthcare royalty/revenue interests sourced from Asia, or through various alternative financing structures.

Olivia Ngan, a partner based in Hong Kong, led the Sidley Austin team. Other key members of the team included Lei Li, managing partner of Sidley's offices in Beijing and Shanghai, as well as partners Annie Wallis (Chicago), Daniel Lindsey (Singapore), and William Gwyn (London).

The team also received support from China advisor Dora Pan (Beijing), senior managing associate Horine Ye (Hong Kong), managing associate Shen Mei Bolton (New York), associate Kelly Lam (Hong Kong), legal assistant Caulyn Bong (Singapore), and trainee solicitor Kelly Kan (Hong Kong).

Sidley Austin's banking and finance team in Hong Kong is part of the multidisciplinary China Corporate and Finance group. The team has been recognised as a Leading Firm in Banking and Finance by Legal 500 Asia Pacific 2023, and ranked Nos. 1 and 2 in Borrower's Legal Counsel by Debtwire's Asia (ex-Japan) Loans Legal Advisors League Table in 2021 and 2022 respectively. The team has also advised on several award-winning financings, which were recognised by China Business Law Journal (CBLJ), IFLR Asia-Pacific Awards, and The Asset.

Sidley’s China Life Sciences practice is a fully integrated part of the firm’s Global Life Sciences practice, which is comprised of more than 200 dedicated lawyers around the world. It has been ranked as the only Band One firm by Chambers Asia Pacific/Greater China Region for 14 consecutive years.

The practice advises clients throughout the entire business lifecycle, from formation and corporate governance to compliance operations for startups. It also guides collaboration, licensing, commercialisation, and filing in the business development phase.

Additionally, the team assists with initial public offerings, refinancing, bonds/notes issuance, as well as domestic and cross-border mergers and acquisitions, asset restructuring, dispute resolution and international arbitration, equity incentive plans, and privatisations.