Alternative assets valuation and valuation oversight: debt funds

Private debt has grown significantly over the past few years: companies contemplate debt as an alternative way to raise money from traditional equity and continue to shift away from traditional bank-backed financing. At the same time, in institutional investors portfolios, the private debt asset class continues to act as a strong diversifier and a source of return - in a low interest rate environment - with the corresponding overall lower risk profile compared to other alternative products, such as private equity or venture capital.

Private debt actors have explored and deployed various strategies, taking advantage of the current market environment and opportunities, and made use of a wide range of debt instruments with simplistic to extremely complex features. This diversity of instruments and corresponding features implies extra and specific diligence when conducting a fair valuation assessment of debt instruments.

PwC Academy is pleased to offer this course designed to help participants navigate through the challenges associated with fair valuation in this asset class.

By the end of this training, participants will be able to obtain comprehensive knowledge on:

• valuation concepts specific to debt instruments;
• recognised valuation methodologies;
• how to apply these methodologies in the context of fair valuation assessment.

• Key terms and features of debt instruments
• Conceptual framework to perform the valuation assessment of debt instruments
• Recoverability analysis
• Discounted cash flows analysis
• Calibration analysis
• Key drivers of debt instruments valuation
• Most common optionality features of debt instruments (callability, puttability and conversion)
• A case study allowing participants to apply the concepts covered in the training

An attendance certificate will be sent to participants.

This training is coordinated by Talat Kadret, Partner at PwC Luxembourg.

The session is presented by PwC subject matter experts dealing on a daily basis with alternative assets valuation topics.

Talat is an audit partner in the Alternative department of PwC Luxembourg.

Since joining PwC in 2007, he has gained experience through numerous assignments in both medium size and international companies. In particular, he has developed strong skills in auditing investment funds with a large focus on the private equity and venture capital industries.

He is also leading our Alternatives Valuation Services (AVS) practice. Talat is currently focused on private equity and venture capital through the audit of several structures organised under various types of companies (SICAR, SIF, RAIF, SCSp, holding) as well as through the review of the valuation of the funds participation (review of the fair market value using different valuation methods, application of the IPEV guidelines, etc.).

Alexandre, Partner, joined PwC Luxembourg in September 2014 and is responsible for the Real Estate and Infrastructure Advisory services. Alexandre has gained a strong experience through his missions as consultant and valuer.

He leads a team dedicated to the annual review of more than 2,000 assets in real estate, debt (backed by real estate collaterals), infrastructure and forestry with an exposure on world markets and is managing an extensive real estate market database that covers all markets and all sectors. Alexandre is responsible for the implementation of models and processes for the three key functions of fund management companies in the context of AIFMD (valuation, risk management, portfolio management). He is also an active member of the Royal Institution of Chartered Surveyors (RICS) and is the lead instructor in real estate valuation.

Alix is an audit director in the Alternatives Valuation Services (AVS) department at PwC Luxembourg within the Assurance Alternatives practice.

He currently specialises in reviewing valuation models and assumptions used for private company equity and private debt valuations for financial reporting purposes. Alix has performed business valuations for a variety of purposes, including fair value accounting, impairment testing and deferred tax asset recoverability assessments.

In his role, Alix has exposure to a range of valuation methodologies such as discounted cash flow models, trading and transaction multiple valuations, milestone analyses, and net asset value as a practical expedient.

He holds the Chartered Financial Analyst (“CFA”) designation and is a Certified Public Accountant ("CPA") licenced in the state of Massachusetts.

Samir joined PwC in 2012 and is a director within our Alternatives Valuation Services (AVS) practice.

He has developed expertise of the private equity industry in the context of assurance engagements, with a focus on business valuations and modelling. He gained an extensive knowledge and set of skills on valuation processes, techniques, and market practices along with the relevant auditing skills.

Samir helps lead our AVS practice in managing and delivering a diverse range of alternative investments and assets valuation engagements, in the context of assurance and non-assurance services, to local and international clients and PwC offices. He has exposure to a wide range of valuation methodologies such as discounted cash flow models, trading and transaction multiple valuations, net asset value approach as well as milestone analyses, primarily in the context of financial reporting.

Samir is a Chartered Financial Analyst (CFA) and a Chartered Valuation Surveyor (MRICS).