5 ways to improve your Information Memorandum

You are not authorized to post comments.

By Nick Crawley on June 10 2010

In the debt markets, nothing says “unprofessional”, “exercise caution”, ”oh not another developer spruiking their project” quite like a poorly prepared Information Memorandum (“IM”) and Model package. Just like an office, staff, webpage, PowerPoint slides, financial model, if an IM can’t be properly prepared and presented then it raises doubts about a developers ability to deliver a project – arguably more challenging than a Word document!

What is an Information Memorandum?

In the Project Finance industry an Information Memorandum is generally presented to financiers and investors, by project developers along with a Financial Model to bring these parties up to speed with the project. It is often prepared by an advisor or a bank acting in this capacity. They are used for a variety of reasons including the sell down of the initial debt raising.

Tips for getting it right

A point often overlooked though is that it is still a sales document, the IM is your golden opportunity to demonstrate that your team can clearly explain the proposed project, representing the key benefits and that the known risks have been properly addressed.

1. Professionally presented

Well laid out, page breaks in between
Sections Use stunning diagrams / maps / logos / structure diagrams
Be consistent with formatting (use Word Styles)
Don’t rely on “Spell checker”, employ an editor / proof reader
Start from scratch or a purpose template (not the last IM !)

2. Professionally packaged

Deliver electronically as PDF
Make accessible online with centralized user control
If printed, bind it properly, do not just use a bulldog clip

3. Written style

Take a top down approach, reading the first page should be sufficient to understand the project
Be factual, back up everything you state
Be concise, it is easy to ramble when you know too much!
Use a professionally, non-emotional, prose
Don’t assume, explain each concept before referencing it

4. Document structure

Cover page
Version control table
Disclaimer
Contents (dynamic)
Contents of diagrams
Glossary of technical terms
Main body
Appendix (consider having as separate documents)

5. Graphs

Include at a decent size, if it is worth graphing its worth showing!
Avoid default colour schemes, it will look like it was rushed
Don’t clutter with too much information
Always include a title and the units
Legend, remember probably printed in black and white
Explain what is being shown and any interesting features

Comments

Additional information

Submitted by Omar Mahmoud on Sun, 13/06/2010 - 16:56.

Hi Nick, Thank you for the informative blog, but it would be more helpful if you elaborate more on: 1)The proposed sections to be included. 2)The graphs, tables, or the informations that lenders may be interested to see as you know the IM is considered to be the "sales flayer" to the lenders.