Lenders expect a fight over revolving credit facilities

Author: Gemma Varriale | Published: 9 Nov 2011

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 Tuesday’s Afme European high yield conference.

“When we look at these transactions, if we’re 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?”