Daily News: May 3, 2012

CFO: Middle Market Embraces Unitranche Loans


CFO.com reports middle-market companies and leveraged buyout firms are returning to the recent past with a hybrid loan structure that simplifies the use of subordinated debt and may lower firms’ cost of capital.

First created in 2005, a unitranche facility is a faster way to borrow than the traditional structure that uses senior and mezzanine debt and which requires the direct involvement of multiple lenders. In a unitranche facility, a single lender, usually a specialist in business development financing, provides the entire credit and works with the borrower. Then that lender slices up, or “tranches,” the loan for other investors.

To view the entire article posted on CFO.com click here.

See related story:
Monroe Capital Says Demand for Unitranche Financing Increases, Tuesday, May 01, 2012