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Fundamentals of Mezzanine and Leveraged Debt Finance

2 Part Course  |  Learn how to simplify and clarify the fundamentals of mezzanine and leveraged debt finance

Fundamentals of Mezzanine and Leveraged Debt Finance Training

A one-day course presented in two half-day live webinars from 9:30am to 1:00pm UK time

  • Delivered online to maximise the use of time
  • Flexible in terms of delivery
  • Describing the basics of mezzanine and leveraged finance
  • Understanding mezzanine and leveraged finance from a practitioner’s viewpoint
  • Practical examples of real leveraged transactions
  • Combining theory and practice in financing deals
  • Demystifying the complexity of the mezzanine and leveraged finance

  • Understand the range of mezzanine instruments available
  • Identify who are the providers of mezzanine and leveraged products
  • Explain how to structure a mezzanine finance deal
  • Calculate exit and return characteristics for mezzanine finance products
  • Explain how alternative lenders and funds operate
  • Use practical examples of the mezzanine in leveraged finance transactions

Part One

Mezzanine financing techniques

  • Survey of leveraged finance techniques, and when it makes sense to use them
  • Finding the optimal financing mix: senior debt, equity or mezzanine?
  • The players and the leveraged finance market today: LBO funds, private equity houses, BDCs, advisory firms and others
  • Assets versus cash flows as support for leverage
  • Second lien financing
  • Contractual versus structural subordination
  • OpCo/PropCo structures
  • HoldCo notes
  • PIK notes
  • Vendor loan notes
  • Case study: Identifying the best use of alternative financing structures for a small corporate
  • The mezzanine matrix
  • Performance-linked participation debt
  • Advantages and disadvantages of an EBITDA-linked interest rate
  • What are the exit possibilities?
  • Setting targets and linking payout to performance
  • Puts and calls in Mezzanine 

PIK (PIYC, PIYW, Toggles)

  • Pay-in-Kind (PIK) generally
  • Different types of PIK
    • PIYW
    • Toggle
    • PIYC
  • “Typical” terms, leverage and pricing
  • Call protection - hard vs soft call protection
  • Market trends / recent leveraged finance deals, Investing in Mezzanine debt
  • Key risks for the PIK holder
  • Case study: Delegates identify the factors that determine the risk of this ""Holdco PIK"" in a mezzanine debt real estate deal

Part Two

Alternative lenders

  • Rise of direct lenders
    • One stop solution
    • Structural flexibility
    • Speed of execution
    • Cost-effective
  • Senior secured loan programmes
  • Use of BDC fund structure
  • Unitranche debt
    • Advantages and disadvantages for borrowers
    • Intercreditor issues
    • Bifurcated Unitranche
    • Unitranche and PIKs
  • Case studies: Examples of Unitranche and mezzanine lending 

Leveraged Finance: Debt structuring and restructuring opportunities

  • The global market for debt and leveraged finance
  • Benchmarking leveraged structures in the market
  • Leverage: the good, the bad and the ugly
    • Performance-driven leveraged finance
    • Defensive leveraged finance
    • Deal-driven leveraged finance
    • Leverage in ownership transition
  • Identifying corporate debt restructuring opportunities
  • Case study: The owner of a private company is looking for a cash-out. Delegates estimate the company's debt capacity and the owner's options. 

Leveraged Buyout Analysis

  • Types of buyouts and how they are financed
  • Sponsor vs trade acquisitions: comparing valuation analysis
  • Implementing a management buyout: senior, mezzanine and equity finance
  • Leveraged finance as a temporary capital structure
  • Spreadsheet-based debt capacity analysis for leveraged finance
  • Case study: Delegates undertake a step-by-step analysis of the company's debt capacity and the LBO financing possibilities.
  • Structuring the relationship between the partners
  • Post-acquisition refinancing and asset sales
  • Pay down and exit analysis 

Leveraged build-ups and leveraged recapitalisations

  • Proactive leverage: roll-ups and recaps
  • Impact of high leverage on business efficiency and shareholder risk
  • Leveraged recaps with share buybacks or special dividends to enhance shareholder value
  • Case study: evaluating a potential buyout deal and recommending the best course of action and a suitable financing structure using mezzanine debtmodel

Mezzanine exit opportunities

  • Advantages and disadvantages of a contingent payment unit?
  • Terms and pricing of the mezzanine in no-liquidity situations
  • Appropriate Linkage: Turnover, Cash Flow or Profit?
  • Exit possibilities and drag along rights
  • Case study: evaluating a funding proposal with performance-linked mezzanine debt finance

The trainer is the Managing Director of an international advisory company specialising in advisory and development services to the corporate, banking and finance industry, which he has owned for the past 17 years. He is an experienced corporate finance professional with practical experience and extensive knowledge of corporate and structured finance in global financial markets.

He is a Visiting Fellow in the M&A department and Program Director at Executive Development, Sir John Cass Business School, London, a member of the Visiting Faculty at Fuqua Business School and has previously worked as an advisor to the Overseas Development Administration in the UK, as well as EU PHARE and TACIS programmes throughout Europe and Russia.

The trainer’s main areas of expertise are corporate finance, M&A, corporate analysis and structured finance, asset securitization, risk management, valuation, corporate credit processes, project finance and treasury management. He currently works with many global corporate and banking clients in these areas and he also acts as an Expert Witness for London law firms in respect of his areas of expertise.

The list of global clients is extensive and covers both European, Middle East, African and Asian markets. In the corporate market, he works extensively with large corporate clients, private equity firms, private investors, as well as public sector companies such as the NHS and major law firms. He provides advisory and development services to these organisations, either through the relevant departments or directly to senior line management.

He is also a well-known figure within the various training and development companies within Europe, regularly gives seminars throughout the world on his specialist topic areas and is a recognized expert in this area by many organisations.

He was previously the Managing Director of a subsidiary of Union Plc, a London merchant bank, having previously worked with several high-profile global investment banks. He left Union Plc in 1996 to form his own international advisory Company.

The list of financial institutions and corporates with whom he has worked over recent years is extensive and includes Allied Irish Bank, Alpha Bank, Bank of America Merrill Lynch, Bank of China, Barclays, Bayern LB, BT plc, Citibank, China Construction Bank, Credit Agricole, Credit Suisse, Danone, DECC, Deloitte, Dexia, Emirates Bank, E&Y, Euler Hermes, First Gulf Bank, FSA London, Garanti Bank, HBOS, Hohhot Bank Mongolia, HSBC, HVB, Iccrea Banca, Intesa SanPaolo, Central Bank of Ireland, KPMG, L’Oreal, Malta FSA, Mongolian Stock Exchange, Morgan Stanley, Mubabdala, NHS and many others.

The overall objective is to ensure that delegates have a solid grounding in theory as well as a practical understanding of the issues.  The material will therefore be both intellectually rigorous and practical.

The training approach will be an interactive online workshop with copious use of exercises and case studies.

Each session lasts for four hours and can be scheduled in the morning or afternoon.  There will be suitable breaks during the sessions.  It is recommended that the programme be ran over a two day period, with either morning or afternoon sessions each day.

Number of places:
Part 1
Number of places:
Part 2

£ 695.00

Per participant per part

Discounts available:

Book multiple places on both parts in one order for the below discounts:

  • 2+ places at 40% less = £ 834.00
    per person
  • 4+ places at 50% less = £ 695.00
    per person
  • 6+ places at 60% less = £ 556.00
    per person
  • 9+ places at 70% less = £ 417.00
    per person

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