A practical, step-by-step guide to the private credit process for operating company borrowers in Asia Pacific, from first conversation to funded facility.
Published by
Donald Klip | Co-Founder, Global Mortgage Group | Head, GMG Capital Advisory
30 years of institutional finance. Former hedge fund founder. Senior roles at top global investment banks. GMG Capital Advisory arranges private credit and special situations finance of $10M–$100M for operating companies across Asia Pacific.
[email protected] | +65 9773 0273 | Singapore · Hong Kong | Asia-Pacific
The private credit process is fundamentally different from a bank credit application. It is faster, more direct, more reliant on the quality of the initial presentation, and more dependent on the borrower's ability to tell a clear, compelling story about their business and their capital requirement.
In private credit, the quality of your preparation determines the speed of your outcome. The best-prepared borrowers move fastest and achieve the best terms.
Before You Approach a Lender: The Preparation Phase
Define your requirement precisely
Before approaching any lender, you need a precise answer to four questions: How much capital do you need? What will you use it for? How will you repay it? What security can you offer? Vague answers to any of these questions will slow the process and reduce your negotiating position.
Assemble your documentation package
The documentation you bring to the first lender conversation determines the speed and quality of the response you receive. A complete package includes:
Audited financial statements for the last 2–3 years (or reviewed accounts for businesses without audit requirements)
Current management accounts and cash flow forecasts for the next 12–24 months
A clear description of the business — what it does, who its customers are, what its competitive position is
A corporate structure chart showing all entities in the group and their ownership relationships
A clear statement of the capital requirement — amount, purpose, tenor, and proposed security
Independent valuations of any significant collateral assets, particularly real property
Key contracts — customer contracts, supplier agreements, lease agreements, any existing debt facilities
Resolve outstanding issues
Legal disputes, title complications, unregistered encumbrances, regulatory issues, and corporate governance problems all slow the due diligence process and can ultimately derail a transaction. Identify and resolve as many of these as possible before approaching lenders.
The Initial Conversation
The first conversation with a private credit lender is a mutual assessment. Come prepared to explain clearly and concisely: what your business does, why you need capital, how you will repay it, and what security you can offer. The ability to explain your transaction clearly in 10 minutes is a strong signal of business quality and management capability.
Private credit lenders will form a preliminary credit view within days of a well-presented initial conversation. If the transaction fits their mandate and the initial information is credible, a term sheet will follow quickly.
The Term Sheet
A term sheet is a non-binding document setting out the proposed terms of the facility: amount, pricing, tenor, security, covenants, conditions precedent, and fees. It is the basis for negotiation and should be reviewed carefully by the borrower's legal advisors before signing.
Key terms to focus on: the total cost (interest plus fees), the interest payment structure, the prepayment rights, the covenant package, the reporting obligations, and the conditions precedent to drawdown. All of these are negotiable at the term sheet stage — they become significantly harder to negotiate once the term sheet is signed.
Due Diligence
Once the term sheet is signed, the lender conducts formal due diligence: financial, legal, and asset. The speed of due diligence is directly proportional to the quality of the borrower's preparation. Lenders who receive complete, well-organised documentation packages can complete due diligence in two to three weeks.
Documentation and Settlement
Once due diligence is complete, the facility agreement and security documents are drafted and negotiated. For straightforward transactions, this can be completed in one to two weeks. Cross-
border transactions with multi-jurisdiction security require additional time for local counsel in each relevant jurisdiction.
Settlement, the simultaneous execution of documents and drawdown of the facility, marks the completion of the process. For well-prepared transactions, the time from initial conversation to settlement is typically four to six weeks.
Working with GMG Capital Advisory
GMG Capital Advisory manages the private credit process from initial assessment through to settlement. We advise borrowers on transaction preparation and presentation, identify the right capital providers for each transaction, negotiate term sheets, and coordinate the due diligence and documentation process.
Our involvement typically reduces the time from initial engagement to drawdown and consistently improves the terms achieved. If you have a corporate financing requirement in Asia Pacific, contact us as your first step.
About GMG Capital Advisory
Donald Klip | Co-Founder, Global Mortgage Group | Head, GMG Capital Advisory
Donald Klip has 30 years of institutional finance experience spanning hedge fund management and senior roles at the world’s top global investment banks. GMG Capital Advisory specialises in arranging and structuring corporate debt financing of $10M–$100M for operating companies, asset owners, and project sponsors where conventional bank lending is unavailable, insufficient, or too slow. We operate across 23+ jurisdictions in Asia Pacific.
www.gmg.asia | [email protected] | +65 9773 0273 | Singapore · Hong Kong
The Debt Desk
Corporate private credit intelligence for Asia Pacific’s $10M–$100M middle market. Published by GMG Capital Advisory. Part of the Private Credit Asia content series.
www.gmg.asia | Read all 41 articles in the series
