The cumulative value of outstanding Defence Offset Obligations for some countries and companies can run into Billions. Some companies within the sector have obligations which they are not necessarily best equipped to deliver, leaving them facing potential liabilities or penalties in the event they fail to fulfil them.
On the other end of offsets, some countries may have legacy obligations due to them by companies where the rapidly evolving domestic and world landscape, as well as present national priorities will have developed into a situation where such obligations no longer represent the best, most effective and therefore most desirable value-added solution.
Our view is that through the creation of a market place and the introduction of a mediated/negotiated approach, both sides can achieve a better, more effective and mutually preferable quicker outcome, especially in relation to deals seeking to attain trade balance. It is for this reason that we are herewith creating the Defence Offset Exchange.
In this backdrop, our objective shall be to initially create a highly confidential intermediated OTC market where obligations and recipients of such obligations, as well as potential partners that could provide solutions to attain specific preferred targets, will be able to accelerate the fulfilment of the original or renegotiated obligations through investment or co-investment of the original partners. New players will bring to the table ideas, capital, projects and project delivery experience with a view of offering a solution which can deliver the most desirable objective, thereby securing an agreement between all parties to secure settlement or partial settlement of the original obligations thereby extinguishing such obligations in part or in full possibly sooner than originally planned.
The ultimate goal shall always be to deliver a more advantageous final outcome for all sides, which reflects today’s reality.
We are currently on-boarding prospective members of this exchange who would be interested in listing their offsets and as part of this start-up phase we shall be also taking on board client feedback in order to present a final formula which shall provide companies a powerful option in their offset delivery arsenal.