Mezzanine financing is a hybrid of equity and debt financing.
Its main features are:
- A combination of debt and equity;
- Subordination to senior debt;
- No security for repayment;
- Flexible legal forms tailored to the diverse needs of financed entities.
Instruments used for mezzanine financing include, without limitation:
- Preferred shares
- Convertible loans.
These instruments are usually only secured by a pledge on shares. An important feature of mezzanine financing is that the repayment of the principal (often one-off) is deferred.
Our role in obtaining mezzanine financing:
- Selection of the appropriate form of financing – we support clients in the structuring of financing transactions;
- Documentation – we prepare and negotiate financing documentation;
- Opinions – we issue legal opinions on the validity and effectiveness of financial and security documents;
- Due Diligence – we perform a due diligence investigation of the financed entity;
- Post-transactional support – we provide post-transactional support, i.a. in the security registration process.