Less reliant on debt than their big deal counterparts, and with the promise of forced sellers and genuine growth, the lower mid-market should be well positioned to weather the downturn. But inexperienced management, resilient pricing and companies vulnerable to economic distress mean there is trouble brewing for small cap investors too.
Tuesday, 25th November 2008
Debt - Structuring
The volume of leveraged buyouts increased significantly in 2006 owing to the ready availability of debt. This may not continue in 2007 as competition grows and failed syndications take their toll.
Buy-out firms are making the most of the changed credit environment. Beneath the heady multiples they are also securing some highly attractive funding terms. By Ross Butler
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