Debt Capital Markets and Convertible Financing in the Netherlands

Debt Capital Markets and Convertible Financing in the Netherlands

Debt financing is an important tool for companies, investors and shareholders that want to fund growth, acquisitions, working capital or restructuring without immediately issuing equity. In the Dutch market, debt financing may take the form of bonds, private credit, venture debt, shareholder loans, convertible loans, bridge financing or structured financing.

The current page already refers to debt instruments such as bonds, corporate bonds, convertible bonds, restructurings and direct loans. For your practice, the page should be broadened beyond classic debt capital markets and made relevant to M&A, VC, PE and growth companies.

Debt financing often connects with Dutch M&A transactions, Dutch venture capital financing, Dutch private equity transactions and Dutch commercial claims and enforcement.

Convertible loans and bridge financing

Convertible loans are frequently used in Dutch startup, scale-up and growth company financing. They can bridge the period until a priced equity round, acquisition, strategic investment or restructuring.

Key issues include conversion triggers, valuation caps, discounts, interest, maturity, repayment rights, subordination, shareholder approval, information rights and the relationship with future investors.

Where the financing involves startup or scale-up investors, the terms should be aligned with future Dutch venture capital structures and shareholder governance.

Venture debt and private credit

Venture debt and private credit can provide growth capital without immediate dilution. These instruments may include security rights, financial covenants, warrants, information rights, negative covenants and restrictions on future financing or M&A activity.

For founders and investors, the key question is how much flexibility remains after the financing. Debt terms can affect acquisitions, exits, future equity rounds, distributions and shareholder arrangements.

If the company later faces distress, debt instruments may also become relevant in Dutch restructuring and insolvency situations or creditor enforcement.

Bonds and debt issuance

Larger companies may consider issuing bonds or other debt securities. These transactions require careful structuring of the issuer, terms and conditions, ranking, security, covenants, investor disclosure, transferability and enforcement mechanics.

For international clients, the Dutch company may act as issuer, guarantor, holding company, acquisition vehicle or borrower. The debt documentation should be assessed together with the group structure, tax advice, regulatory requirements and future transaction plans.

Relevance for international clients

International investors and lenders may encounter Dutch debt financing issues when investing in or lending to a Dutch B.V., Dutch holding company or Dutch acquisition vehicle.

Relevant questions include whether shareholder approval is required, whether security can be granted, how convertible instruments convert into Dutch shares, how enforcement works, whether subordination is effective and how debt terms interact with shareholder agreements, investor rights and M&A documentation.

Legal support

Dirk de Waard advises companies, founders, investors, shareholders and M&A parties on Dutch debt financing, convertible loans, venture debt, private credit, shareholder loans, bridge financing and capital structures involving Dutch companies.

Structuring debt, convertible financing or venture debt involving a Dutch company?

Dirk de Waard is a partner at VentureLawyers and works with a dedicated team of M&A, venture capital and private equity lawyers. Contact Dirk via dirk.dewaard@venturelawyers.nl to discuss the Dutch legal structure, financing terms, investor rights and transaction documentation.