SOURCE: Finacity

March 20, 2007 09:18 ET

Finacity Wins Trade Finance Magazine's "2006 Deal of the Year"

NEW YORK, NY -- (MARKET WIRE) -- March 20, 2007 -- Trade Finance Magazine honored Finacity Corporation's ("Finacity") Alliance One International ("AOI")(NYSE: AOI) transaction as one of the magazine's "2006 Deals of the Year." London-based Trade Finance is published by Euromoney Institutional Investor PLC and specializes in export and commodity finance.

Finacity successfully facilitated both an investment grade and off-balance sheet execution for AOI's 3-year, $55 million non-OECD trade receivable securitization. This transaction met A1/P1 rating criteria despite the non-OECD nature of the receivable obligors. Finacity worked extensively with its strategic partner, Euler Hermes, to wrap the receivables from non-OECD countries (including Argentina, Bulgaria, China, Egypt, Indonesia, Jordan, Pakistan, Philippines, Russia, South Africa, Ukraine, and the United Arab Emirates) with trade credit insurance, covering both corporate and political risk. Additional structuring challenges included AOI's S&P "B" credit rating, all transactions being cross-border, some obligors having open credit while others using letters of credit, multiple jurisdictions, and the underlying collateral being an unfinished commodity. Finacity worked with Hannover Funding Company LLC, administered by Norddeutsche Landesbank Girozentrale, to fund the transaction. Even after successfully structuring this facility, the funding depended upon Finacity's customization of its in-house fraud detection and collateral valuation application and data repository to respectively verify and warehouse every purchased invoice. These efforts were in addition to the weekly reporting that provided all parties with visibility to assets, collateral values and receivables performance.

An additional complexity through which Finacity successfully navigated was the achievement of true-sale treatment across complex jurisdictions. The legal, accounting and operational challenges are a consequence of the receivables being invoiced out of a Swiss entity, managed operationally in the United Kingdom, with the parent company based in the United States and the obligors located in numerous non-OECD countries with product shipments originating across the globe. Notwithstanding this complexity, AOI was able to achieve off-balance sheet treatment with proceeds being available to reduce debt.

Finacity Corporation specializes in the structuring and provision of efficient capital markets receivables funding programs, state-of-the-art servicing, and bond administration. Finacity is located in the USA and Europe. For more information about Finacity, please visit www.finacity.com.

Please do not hesitate to contact Adrian Katz at (203) 428-3540 or akatz@finacity.com should you have any questions or comments about the transaction.

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