Future cash flow securitization converts contracted future revenue into capital today. The contracted cash flow is assigned to a compartment of a Luxembourg SPV, ring-fenced from the rest, which issues a note bearing its own ISIN. Payments received by the compartment over time fund the note.
A royalty stream, a long-term supply contract or a book of subscriptions is value that arrives slowly. MTCM houses that stream in one ring-fenced compartment of its six Luxembourg SPVs, and the note that comes out of it has an ISIN of its own. The originator receives capital at issuance; the compartment collects the contracted payments as they fall due. The compartment is set up under the Luxembourg Securitization Law of 22 March 2004, bankruptcy remote in either direction and off the originator’s balance sheet. GSK Stockmann acts as legal counsel to the platform, with PwC and Atwell as auditors.
Held in custody, transferred or listed like any other security.
Segregated by law from every other transaction on the platform.
Protection runs in both directions.
The exposure leaves the originator’s balance sheet.
Contracted royalty streams from music, publishing, patents and brand licensing.
Payments due over several years under an existing supply or offtake agreement.
Recurring fees under maintenance, management or outsourcing agreements.
Contracted rent under existing leases over property or equipment.
Payments due under identified licence and lease agreements.
Contracted fees and royalties payable under franchise agreements.
Recurring billing under an identified base of subscription contracts.
Contracted revenue from film, television and catalogue distribution.
Payments due under a concession or availability agreement.
Amounts due under an existing settlement or an award already obtained.
Future cash flow securitization converts contracted future revenue into capital today. The stream is booked into a compartment ring-fenced under Luxembourg law, and that compartment issues a note with an ISIN of its own. Payments collected by the compartment over time fund the note.
Royalties, long-term sale and supply contracts, service and management fees, rent, licensing and leasing payments, franchise fees, subscription revenue, media and distribution rights, concession revenue, and amounts due under an existing settlement or award.
The contract does. The payments do not. What the compartment needs is an existing obligation to pay, with identified counterparties and a determinable schedule, rather than a projection of revenue the originator hopes to generate.
By discounting the contracted payments to present value, on a methodology agreed when the compartment is structured and reviewed as part of the audit. The methodology is documented rather than assumed.
Normally yes. The originator typically continues to perform under the contracts and to invoice, passing collections to the compartment under a servicing arrangement agreed at structuring.
Rights holders and catalogue owners, companies with long-dated supply or service contracts, franchisors, subscription businesses, and the wealth managers and family offices that take the resulting exposure through a security.
Where the stream depends on future performance rather than an existing obligation, it can still be structured, but the compartment is built differently.
| Cash flow profile | Typical note form | Amortisation |
|---|---|---|
| Level contracted payments | Amortising note | Matched to the payment schedule |
| Back-loaded or single payment | Zero-coupon or bullet note | At maturity |
| Variable but contracted | Pass-through note | As collected |
| Several contracts, staggered | Amortising note over the combined schedule | Blended |
80+ active compartments · €2.5 bn+ assets structured. Indicative platform figures.