In brief. A direct institutional facility secured by listed shares the company or its holding company already holds: non-recourse, funded from Silo’s own capital, and documented in a fixed order so the capital is visible before any shares move. No new shares, no placement, no dilution.
A listed company, or the holding company above it, sometimes needs capital at a moment the market will not supply it. A refinancing falls due in a quiet quarter. An acquisition target is available now, not at the next window. A bolt-on, a roll-up or a strategic investment needs funding before a placement could be organized, or at a size that would not justify one. In each case the board faces the same choice: dilute, wait, or find capital that does not depend on the equity market’s timing.
This piece describes the third option as Silo structures it: a direct institutional facility secured by listed shares held by the issuer or its holding company, documented transaction by transaction, and funded from Silo’s own capital.
What is it?
Silo provides direct institutional facilities to public issuers and holding companies for refinancing, acquisitions and strategic capital outside traditional market windows. The facility is secured by listed shares. It is non-recourse: there is no personal or corporate liability beyond the pledged collateral. The capital is Silo’s own, deployed directly, not brokered, and it is prefunded before the operational steps that release funds begin.
The shares that secure the facility are not sold. Silo’s execution is prefunded; no securities selling is required for execution. Facilities are structured to enable liquidity while maintaining full economic exposure to the shares, so the company’s or holding company’s position in the underlying equity is retained during the term under documented collateral mechanics.
What is it not?
It is not an equity raise (no new shares, no placement, no dilution); not a margin line (no recourse beyond the pledged collateral, no repricing at a bank’s discretion, and collateral events defined in advance in the documents); and not an offer: every matter remains subject to Silo’s review, diligence, approval, jurisdictional analysis, compliance review and definitive documentation.
How is the facility documented?
A Silo facility is documented through four instruments: a Facility Agreement, a Collateral Management Agreement, a Promissory Note and a Closing Statement. They are signed in a fixed order, and the order is part of the protection.
- Terms first. The Facility Agreement and the Promissory Note are signed, so the terms are fixed before anything moves.
- Capital in place. The borrowing entity opens an account in its own name at the designated broker-dealer. Silo’s capital for the facility is deposited into that account, where the company can see it before any shares move.
- Shares deposited. The shares are deposited into the same account.
- Collateral activated. The Collateral Management Agreement, between the borrower, Silo and the broker-dealer, is executed, and the broker-dealer activates the collateral parameters.
- Economics confirmed. Silo issues the Closing Statement confirming the economics, and the borrower signs it.
- Release. On the borrower’s signature, release of funds is instructed immediately. Any further tranches follow the Facility Agreement.
Full drafts of all four documents are provided to the company’s counsel for review before signing. The operational steps are carried out by licensed securities firms and broker-dealers, not by Silo itself. Each document is explained in the four documents of a structured facility.
What should the board consider?
A facility secured by a company’s or holding company’s own listed shares engages questions that depend on the exchange, the issuer’s constitution and the holder’s position. They are questions for the company’s counsel, company secretary and auditors, not for the lender, and the transaction timetable should accommodate them.
- Authority. Which approvals does the board, and if relevant the shareholders, need to give before the company or the holding company pledges listed shares and borrows against them?
- Disclosure. Does the pledge, the facility or a later enforcement trigger an announcement, a filing or a disclosure in the issuer’s periodic reports?
- Constraints. Do existing financing agreements, shareholder agreements, lock-ups or the articles restrict a pledge of these shares or additional borrowing?
- Use of proceeds. Is the intended use, whether refinancing, an acquisition or a strategic investment, consistent with the company’s authorizations and any undertakings it has given?
- Accounting and tax. How will the facility and the collateral arrangement be treated in the accounts and for tax purposes?
Silo’s facility terms are aligned to the liquidity, volatility and collateral quality of the specific shares. Silo’s published parameters refer to acceptable listed equity, listed for at least three months, with clear ownership and transferability; restricted and control shares are considered case-by-case; typical facility size is USD 1M to 150M and above.
How do we begin?
A first conversation needs only the exchange and ticker, the approximate size of the position the company or holding company would pledge, whether the shares are unrestricted and free-trading, and the purpose of the capital. The facility itself is described on the Private Credit & Corporate Liquidity page, and inquiries are reviewed directly by Silo. The collateral mechanics that apply across Silo’s facilities are described on the Securities-Backed Credit page.
Frequently asked questions
Does the company give up the shares?
No. The shares are deposited into an account in the borrowing entity’s own name at a licensed broker-dealer and become collateral under the Collateral Management Agreement. Silo’s execution is prefunded, and no securities selling is required for execution.
Is this dilutive?
No. No new shares are issued and no placement is made. The facility is secured by shares the company or holding company already holds.
Who signs the documents on the lender’s side?
The Silo lending entity. No outside party may approve, bind or commit Silo. The Collateral Management Agreement is between the borrower, Silo and the designated broker-dealer.
Will our counsel see the documents before we sign?
Yes. Full drafts of all four documents are provided to the company’s counsel for review before signing.
Can the proceeds be used for an acquisition?
Silo’s facilities for public companies and holding companies are described for refinancing, acquisitions, growth, roll-ups and bolt-ons. Whether a particular use is permitted for a particular company is a matter for its own authorizations and counsel.
This material is provided for informational purposes only. Nothing herein constitutes investment, legal, tax, securities, accounting or regulatory advice, an offer to lend or provide financing, a solicitation, a recommendation, or a commitment to enter into any transaction. Access may be restricted by jurisdiction or residency. Any potential facility remains subject to Silo’s review, diligence, approval, jurisdictional analysis, compliance review and definitive documentation. Readers should consult their own professional advisers.