Mezzanine Finance

The importance and use of mezzanine finance has increased significantly in recent years and this seminar covers all of the major applications of mezzanine debt in buy-outs.

Particular emphasis is given to the structural aspects associated with the deployment of mezzanine finance, including the potential use of warrants as equity kickers.

Mezzanine is also compared and contrasted with the different alternatives.

Participants will be required to bring a calculator to the course.

Course Content:

Introduction to Buy-outs
 Use and application of mezzanine finance
 The fundamental principles and drivers of LBOs
 Rationale and attractions of mezzanine finance
 Structure of the mezzanine market
 Structuring issues – the key issues in structuring LBOs
 Structuring parameters - creating an appropriate financial structure

The Mezzanine Spectrum: Key Terms, Conditions and Trends
 Spectrum of financing instruments in LBOs
 Spectrum of mezzanine instruments
 General terms applicable to mezzanine debt generally
 Mezzanine – analysis of returns

Traditional (warranted) mezzanine
 Typical terms
 Warrants defined
 Critical issues to consider in relation to warrants (anti-dilution)
 “Shareholder” issues

Warrantless mezzanine
 Evolution of and rationale for warrantless mezzanine
 Attractions of warrantless vs warranted mezzanine
 Hybrid mezzanine products
 Techniques for structuring the warrantless aspect of the deal

Pricing aspects and trends
 Aspects that impact the pricing of mezzanine
 Issues for the various players in the mezzanine market (Funds vs Captives)
 Trends in pricing, structure of mezzanine

The mezzanine lender’s perspective
 The role of the loan documentation
 Debt capacity
 Key covenants in loan documentation
 Key financial covenants – use and application

Intercreditor issues
 Priority vs junior lenders/equity
 Priority vs senior lenders
 Issues relating to adequate information

Delivery:	Classroom
Regions:	London
Category:	Advanced Corporate Finance