Restructuring an acquisition finance deal
Produced in partnership with Neil Caddy of Milbank
Restructuring an acquisition finance deal

The following Banking & Finance guidance note Produced in partnership with Neil Caddy of Milbank provides comprehensive and up to date legal information covering:

  • Restructuring an acquisition finance deal
  • Consensual restructuring
  • Non-consensual restructuring
  • Relevant factors

BREXIT: As of 31 January 2020, the UK is no longer an EU Member State, but has entered an implementation period during which it continues to be treated by the EU as a Member State for many purposes. As a third country, the UK can no longer participate in the EU’s political institutions, agencies, offices, bodies and governance structures (except to the limited extent agreed), but the UK must continue to adhere to its obligations under EU law (including EU treaties, legislation, principles and international agreements) and submit to the continuing jurisdiction of the Court of Justice of the European Union in accordance with the transitional arrangements in Part 4 of the Withdrawal Agreement. For further reading, see: Brexit—introduction to the Withdrawal Agreement. This has an impact on this Practice Note. For guidance, see Practice Notes: Brexit—worst case scenarios for R&I lawyers and Brexit—impact on finance transactions.

The diagram below shows a simplified diagram of a typical acquisition finance structure.

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When a leveraged credit encounters trading difficulties, depending on the severity of those difficulties, this is likely to result in one or more of the following:

  1. a relaxation and/or waiver by the creditors of any financial covenant requirements in the financing documents. Any financial covenant requirements will have been set on the premise that the profitability of the business will improve