Mezzanine finance

Overview

We have extensive experience in advising on mezzanine finance and subordinated debt transactions, including leveraged public and private buy-outs, capital expenditure programmes and refinancings.

We act for a broad range of financial institutions, mezzanine funds and debt investors in their capacity as arrangers and lenders of, and investors in, mezzanine finance and other subordinated debt instruments. We also advise senior lenders, private equity sponsors and borrowers/issuers on using mezzanine and other subordinated debt instruments as part of their capital structures.

This experience means our clients benefit from our specialist knowledge of the current legal, commercial and market issues relevant to these financing transactions.

Our mezzanine finance team works alongside Macfarlanes’ highly rated private equity, M&A, investment funds, tax and restructuring teams to advise on every aspect of mezzanine and subordinated debt financing, including:

  • mezzanine facilities and subordinated debt instruments, advising on current market terms (e.g. margin levels and call protection) and tax and security structures;
  • warrants, synthetic warrants, options, convertible notes and other equity upside and co-investment arrangements (including advising on tax-efficient instruments for different jurisdictions);
  • inter-creditor agreements and other subordination arrangements (including advising on current market terms for these agreements);
  • reviewing due diligence, acquisition, equity and senior finance documentation and reporting on all issues relevant to mezzanine and subordinated lenders; and
  • default, workout and insolvency situations (including advising mezzanine and subordinated creditors on enforcing and protecting their rights in restructurings and formal insolvencies).