CAK Universal Credit Corp. expects to close four patent/royalty securitizations by the end of this quarter, said Robert D'Loren, president and chief operating officer of CAK.
The deals will average $40 million in size. Two of the transactions will be apparel licensing deals, with revenues tied to a clothing brand. The other two will be a publishing company deal, backed by the revenues associated with copyrights, and a retail franchise royalty deal, backed by the revenues associated with a franchise's intellectual property, i.e. logo, name, etc.
"Our first quarter is going to be good for us," D'Loren said. "We're very pleased with where we are coming out of the box."
Late last year, in a landmark "whole company securitization," Arby's securitized the royalties associated with its logo, the ten-gallon hat.
Similar to Arby's, the pending deals use the CAK's controlled rights design, where the securitizing entity must actively manage its brand - and is responsible for the exploitation and distribution of the product - as opposed to other types of intellectual property deals, where the borrower/artist does not have direct control over the revenue stream.
CAK's deals are virtually carbon copies of those the company has already brought to market. With the technology in place, CAK can now turn around a deal in as little as four months, D'Loren said.
In March of 2000, CAK partnered with Deutsche Banc Alex. Brown. CAK's most recent publicized transaction was a $5.5 million royalty income deal for musician Curtis Mayfield. -