Protections included in revolving credit facility (RCF)
deals and how they will compare to bond transactions is still
open to uncertainty. The lack of precedent means finding the
answer will be deal-specific according to the panellists at
Tuesdays Afme European high yield conference.
When we look at these transactions, if were
representing the financial sponsor, we ask the question: do we
need additional covenants with respect to acquisitions?
said Kevin Muzilla of Allen & Overy. Do we need a
grace period with respect to covenant default that in a high
yield deal would see 30-60 days?