Covington Represents Procura in Landmark $2.2 Billion Structured Inventory Purchase Program

Covington Represents Procura in Landmark $2.2 Billion Structured Inventory Purchase Program

December 11, 2023

NEW YORK—Covington advised Procura Inventory Management in a structured $2.2 billion transaction to facilitate the ongoing purchase and sale of computer chips and other high technology products necessary for the build-out of cloud computing centers. Procura purchased an initial $2.2 billion of inventory from an information technology systems integrator to support the needs of its customers in the build-out of cloud computing infrastructure. In addition to the inventory purchased at the closing, the program will support the ongoing purchase and sale of inventory. Covington assisted Procura in the drafting and negotiation of purchase, warehousing and agency sale contracts and a $2.2 billion credit facility it obtained from a syndicate of banks led by J.P. Morgan.

Procura is a private, independent company focused exclusively on assisting clients with their inventory management needs and improving their working capital position. The Procura team has multi-decade experience in structured trade and inventory finance solutions incorporating accounting, logistics & operations, tax, legal, regulatory & capital markets aspects with relevant experience across various industries and sectors. Its business model is to work closely with key bank and other key strategic relationships. J.P. Morgan selected Procura it as its strategic partner for inventory management offerings to its corporate clients in the context of which it is prepared to fund Procura through debt facilities for the purchase and holding of inventory goods.

The Covington team included Peter Schwartz, Julian Wright, and Brendon Francis, and Martin Beeler and Dianne Coffino (bankruptcy), Kurt Baca (tax), and Gus Caywood and David Engvall (opinion committee).