Why do real estate loan sellers perform due diligence?
Sale of real estate loans is difficult largely due to their lack of homogeneity and the due diligence process, which can be very inefficient, time-consuming and expensive for the p...
Who are the obligors in acquisition finance?
The syndication process is initiated by a sponsor. The sponsor is the “Investors” that contribute “equity” in the form of equity capital (common or preferred) and/or shareholder l...
The actual syndication process is initiated when bookrunners send invitation letters to prospective syndication participants. Sub-underwriting is launched by bookrunners sending i...
When is acquisition transaction closing?
Not all facility obligors will be party to the agreement on the closing date. Until the closing date, usually the only obligors are the parent and the acquiring company. The targ...
When is a market flex exercisable?
The market flex is typically exercisable from the date of the signing of the mandate letter to the facility signing and syndication closing, on which date all the lenders subject t...
Syndication closing when the total amount of a financing has been fully allocated, the loan price has stabilized and there is little risk of lender loss on the loans when they are...
When can interest margin change?
A margin flex allows bookrunners to unilaterally adjust to a loan’s margin during syndication to reflect a change in prevailing market conditions, to facilitate its successful synd...
When are syndicates organized?
Finance structuring in loan syndication involves the designing and negotiating of a financing with the borrower by the lead arranger, commonly together with other members of the sy...
When are syndicates established?
To establish a syndicate, one or more arrangers are mandated by a borrower to arrange the financing and organize and lead the syndicate. The financing syndication starts with its...
When are commitment letters used?
In the US loan market, a commitment letter issued by the appointed lead arranger may be used instead of the term sheet and mandate letter to set forth the mandated lead arranger an...
