Capital Currents: Navigating Market Uncertainty

Solomon’s Vinod Chandiramani, Head of Capital Advisory, speaks with M&A Director, Chris Moynihan, about the shifting dynamics in the private markets and liquidity strategies to proactively navigate current economic conditions.

Transcript

Chris Moynihan (00:02):

You are listening to Solomon Partners Presents. I’m Chris Moynihan, and I’m here today with Vinod Chandiramani, head of Capital Advisory, to hear his views on the current markets and developing a strategy to navigate the complicated environment. Vinod, what’s your take on the markets today?

Vinod Chandiramani (00:18):

The options that our clients and market issuers had a few months ago have narrowed. Where we’re seeing a lot of activity, and a lot of appetite is in the private market, and that market is open for business and ready to deploy.

Chris Moynihan (00:38):

So, Vinod, obviously a lot of uncertainty in the markets. The M&A market hasn’t been a great year, to date, although that might be changing. What are you seeing on the private credit side?

Vinod Chandiramani (00:48):

The uncertainty in the market today is going to make it challenging to facilitate change of control transactions and M&A activity. We have a backdrop of private equity investors who need to facilitate distributions to LPs who have been in investments for a long period of time. I think within our group and what we’re seeing in the private markets presents an opportunity for us to come up with solutions to help those owners achieve their goals. And that could be raising bespoke first-lien financings to hybrid capital solutions that may not facilitate an ultimate change of control, but can facilitate dividends and distributions to LPs, which in this market is highly valued.

Chris Moynihan (01:40):

So, for those companies looking to access this market, what should those issuers think about?

Vinod Chandiramani (01:46):

In today’s market, not knowing when the timeline of this volatility is going to abate, it’s going to be really important to focus on bolstering liquidity and ensuring that you’re putting your company in a position to navigate the environment, as well as achieve your ultimate business objectives. Absent taking the time to do the prep work and evaluate various outcomes, I think there’s a real risk that companies can be caught flatfooted — and the range of potential outcomes and optionality is getting pretty limited.

Chris Moynihan (02:23):

What’s your expectation for the rest of 2025? Is this a new status quo?

Vinod Chandiramani (02:28):

As we look at the market today, nobody knows what the ultimate outcome of the current geopolitical environment’s going to be, but what we do know is we are at a point in time where it benefits our clients to be proactive and evaluate various scenarios and potential outcomes to maximize the probability of playing offense, as well as putting themselves in a position to implement their business plan and ultimate strategic objectives.

Chris Moynihan (03:02):

So, it’s great color on the market. Maybe give us a sense of how we at Solomon Partners work with our clients.

Vinod Chandiramani (03:09):

We partner with our industry bankers to make sure we truly understand the strategic objectives of our clients, and then we create tailored solutions across a varying mix of capital providers to develop what is ultimately a unique outcome and what we believe is a differentiated outcome. We want to be in the lab with our problem-solving, and what we do as well is we’re in the labs with the investors problem-solving for their issues so that we can bridge the gap to develop a win-win.

Chris Moynihan (03:48):

Thank you, Vinod. We’re happy to have you on the Solomon platform. To our listeners, thank you for tuning in. Be sure to visit solomonpartners.com for more insights and takeaways. We hope you can join us next time.