The following Banking & Finance guidance note Produced in partnership with Gleiss Lutz provides comprehensive and up to date legal information covering:
Following the post-financial crisis reforms in the banking system under Basel III and the support of central banks in ensuring the functioning of broader credit market funding conditions, in particular the ECB's 2015 Asset Purchase Programme and the Corporate Securities Purchase Programme in spring 2016, the overall capacity and willingness of banks to lend has increased. Coupled with the increased presence of alternative debt providers, this development has resulted in the loan market in Germany being extremely attractive for borrowers.
The leveraged finance market has been buoyant in the last few years. In the leveraged finance segment, small-cap and mid-cap transactions are usually being financed either by domestic banks and/or international banks with a strong presence in Germany or alternative debt providers in the form of unitranches (usually supported by a super senior ranking revolving credit facility offered by a bank). While unitranche providers require higher pricing than banks, the overall debt quantum offered to the borrower is usually higher, making the unitranche an attractive instrument for private equity funds seeking to maximise the amount of debt to support their buyouts. Unitranches now account for roughly 50% of leveraged financings in the small- and
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