NAV Financings and “Bankruptcy Unlikely” Special Purpose Vehicles

This article examines structuring tools to help demystify, simplify and harmonize the documentation and structures supporting Net Asset Value financings (“NAVs”). For the purposes of this article, NAV refers to a senior ranking credit facility provided to a private equity or similar fund or asset manager which is supported by a diversified portfolio of assets and their related cash flows, and sized based on the net asset value of such portfolio.