Introduction to Standard Merchant Asset Finance

  • Standard Merchant Private Asset Finance provides friendly efficient  flexible asset finance solutions via an established partner network of independent financial institutions, asset finance brokers across South Africa, smaller banking institutions, dealers and suppliers of asset based financing. Informed asset acquisition tailored to client needs that embraces market change which is essential in modern day Sub-Sahara Africa to convert opportunities into competitive advantages for any business establishment’s success.

  • To support positive cash flow management and an enhanced gearing of debt to equity Standard Merchant can assist clients with equipment financing via rental basis or alternatively an Instalment Sale.

    Asset rentals protect any business establishment against depreciating assets and can assist companies to upgrade to the latest technology and equipment depending on supplier availability. Rental agreements ensure the delivery, maintenance of assets and payments. Which can be structured according to a client’s unique needs to assist cyclical business deal flow.

  • Standard Merchant offers extensive insight and knowledgeable advice into the intricacies of asset rentals, the various finance options available and the tax advantage in term of Asset finance leasing vs Asset Finance.

asset finance

Asset Classes We Finance: 

Information Technology
Business Technology
Aviation
Mining and Construction
Material Handling
Medical
Golf and Leisure
Telecommunications
Other Assets

Our Approach to Asset Finance

  • Rent to own

    Operating Lease with ownership at end of the term (asset based lending)- The structure is the same as an operating lease however with the pre-negotiated premium option to exercise ownership of the equipment at the end of the period.

  • Rent to use

    Operating Lease (asset lending) – There is no ownership of the asset at the end of the period and you only pay for the use and enjoyment of the asset. Full input VAT claimable and expense fully deductible in terms of income tax act

    By using a leasing facility to lease movable and durable goods this enables you flexible options which you require for your business operations. Standard Merchant purchases the asset used by you for an agreed period. This is pure off balance sheet funding where there is no depreciation to write off and the interest is calculated on the capital amount excluding VAT. Cost-related rentals are paid by you and Standard Merchant retains ownership of the goods for the duration of the lease. When the lease expires, you have various options available to you:

    • Purchase the leased asset from Standard Merchant
    • Upgrade the leased asset of Standard Merchant
    • Extend your lease of the asset for a longer period.

Key Features and Benefits

  • Flexible terms:

    Structure the deposit and the repayment period to suit your business needs

  • Flexible interest rates

    Link your interest charges to the Prime lending rate or fix interest rates for a specified period

  • Insurance

    Insure all goods comprehensively and take advantage of competitively-priced rates from our insurance partner

Installment Sale

Also known as a Financial Lease. To meet your flexible finance needs, Standard Merchant Private Asset Finance offers Installment Finance which enables you to pay affordable installments for moveable and durable goods that your business requires. Standard Merchant purchases these goods and sells them to you on agreed terms. In addition to finance charges, you repay the full amount in installments over an agreed period. Ownership of the goods lies with Standard Merchant until all payments are made, where-after ownership automatically transfers to you. This lease is treated as structured finance on balance sheet funding and depreciation can be written off. Interest is charged on the full capital amount including VAT.

Key Features and Benefits

  • Flexible terms

    Structure a repayment period and a deposit that best suits your business needs and your cash flow

  • Flexible interest rates

    Link your interest charges to the Prime lending rate for a fixed or specified period

  • Insurance

    Insure all goods comprehensively and take advantage of competitively-priced rates from our insurance partner

  • Ownership

    Take full ownership of the goods once you make the last repayment

A sale and leaseback or sale and installment sale

is typically a corporate structured asset transaction in which one party sells its assets to Standard Merchant. The seller then leases or repays the asset back at a rental rate and lease term that is acceptable to Standard Merchant. The lease term and rental rate are based on our financing costs, the lessee’s credit rating and market rates of return.

A sale and leaseback transaction entails the sale of assets and the simultaneous commitment to a long-term lease of generally 3 to 15 years depending on the asset class. This combination allows a company to redeploy the capital that had been invested in non core assets back into its core business.

We are always on the lookout for potential win-win sale & leaseback deals.

Key Features and Seller benefits from a sale & leaseback

  • Enhance shareholder value

    Selling core and non-core properties generates immediate cash flow. Companies can reinvest the proceeds in their higher yielding core businesses or make new acquisitions.

  • Improve balance sheet

    The proceeds from a sale-leaseback can be used to reduce debt or a complete off balance sheet transaction

  • Focus on Core Business

    Sale-leaseback transactions allow companies to focus on their core business to generate better returns from their businesses than they could by holding the asset class.