Mezzanine Debt Uses & Advantages
Mezzanine debt funding can be used for the following:
- Acquisition financing to purchase the stock or assets of a business.
- Growth capital financing to improve the working capital position.
- Refinancing to pay off bank loans or repayment of currently due or stretched liabilities.
- Recapitalization financing to buy out a business owner.
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Mezzanine debt funding has a number of advantages making it a superior form of growth capital financing to bank loans or equity capital. These include:
- The loan size is based on a company’s cash flow value not asset value.
- This results in a far greater loan size than a bank loan.
- Mezzanine loans are longer term (5 to 6 years) than bank loans and have no personal guarantees.
- Mezzanine loans have back ended principal repayments vs. bank loans.
- The terms and conditions are more flexible than a bank and less intrusive than an equity investor.
- Mezzanine loans, if structured with our tool suite, can provide 100% of the capital needed for a transaction.
- This eliminates the need for expensive equity investment.
Our mezzanine debt funding solution as a superior form of growth capital financing, delivers great outcomes for our clients in a variety of projects. Whether it is an acquisition financing, growth capital financing, bank refinancing, or owner buy-out, our mezzanine funding solution will deliver a peak outcome.
Our mezzanine debt solutions are quoted on a project basis.
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