Structural subordination: it’s lonely at the top

Author: | Published: 11 Apr 2019

Structurally subordinated instruments are becoming increasingly popular in acquisition financings. Here Paul Hastings lawyers consider the pros and cons of the two most popular instruments: holdco PIK and preferred equity

Structurally subordinated debt products Subordinated products, such as holdco PIK [holding company payment in kind] and preferred equity, are increasingly deployed by private equity sponsors seeking to raise additional capital and increase leverage in acquisitions....