Buyout Shops: Profiting From Debt Repurchases In 2009
A Special 90-Minute Webinar!
Now’s the time to buy portfolio-company debt. But how?
The opportunity is unprecedented. Senior loans and high-yield bonds are changing hands at massive discounts. Portfolio companies with extra cash on hand can retire debt at a cost far beneath what it will cost to refinance down the road. And if portfolio companies don’t have the cash on hand? Buyout firms themselves may wish to purchase debt on the secondary market, either as an opportunistic investment, or as a way to ease pressure on a company that may not be hitting on all cylinders. More than anyone, buyout pros know when discounts on portfolio-company debt are warranted or overdone.
But buying portfolio company debt poses a number of challenges.
Among them: navigating restrictions in the underlying debt documents. To give you a thorough understanding of the challenges, problems and solutions, Thomson Reuters, publisher of the popular Buyouts Magazine and Venture Capital Journal, is convening an all-star cast of expert speakers for a 90-minute online seminar. Among the questions addressed:
- What’s the best way to deal with credit-agreement provisions that impact the ability of portfolio companies or their owners to buy senior debt?
- What rights do junior lenders have to veto the purchase of senior debt, and what kinds of concessions have to be offered to get them to play ball?
- What impact does the purchase of debt by borrowers or buyout shops have on the financial covenants of the loans?
- What tax liabilities arise for portfolio companies whose debt is retired?
- What insider trading and disclosure rules do borrowers and buyout shops need to be mindful of in purchasing high-yield debt? Under what conditions would they have to conduct a tender offer?
- What is the risk that a court will re-characterize debt acquired by a buyout firm in its own portfolio company as equity?
- How do lender liability laws influence the role that buyout shops-cum-creditors play in managing their portfolio companies?
- What terms in limited partnership agreements commonly impact the ability of buyout shops to acquire debt in their own portfolio companies?
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Expert Speakers
Steven M. Ellis, Partner, Proskauer Rose LLP
Mr. Ellis is an expert in negotiating working-capital loans, subordinated debt, second-lien loans, and distressed debt facilities, typically in connection with IPOs, recapitalizations, mergers and acquisitions, private equity and going-private transactions. He is a partner in the corporate department of Proskauer Rose LLP, head of the Boston office, co-head of the distressed debt group and junior capital group, and co-chair of the corporate finance group.
Mario J. Ippolito, Partner, Paul, Hastings, Janofsky & Walker LLP
Mr. Ippolito is a partner in the corporate practice of Paul Hastings, focused on lending in private equity and other corporate finance transactions. His practice includes the representation of international banks, hedge funds and other financial institutions in leveraged finance transactions involving syndicated senior loans, cash flow loans, enterprise-value credit facilities, mezzanine loans, second-lien loans and related debt instruments.
Durant (“Randy”) D. Schwimmer, Senior Managing Director-Head of Capital Markets, Churchill Financial
Mr. Schwimmer is responsible for loan origination, structuring, syndications and distribution at Churchill Financial, a leading provider of senior loans to finance mid-market buyouts. With more than 28 years of experience in mid-market finance, he is widely credited with developing the loan syndication market for mid-market companies.
John D. Toronto, Director-Investment Banking, Credit Suisse
Mr. Toronto is responsible for negotiating terms and conditions of credit agreements as part of loan syndications and loan buybacks for Credit Suisse, one of the leading underwriters of loans and high-yield bonds used to finance leveraged buyouts. He works closely with the Credit Suisse Capital Markets Group, investors and borrowers.
Scott S. Jones, Partner, Proskauer Rose
Mr. Jones is a partner in the Tax Department of Proskauer Rose LLP, and a member of the private investment funds group. His practice focuses on tax planning for private equity fund managers in connection with their fundraising and internal organizational matters, as well as investment activities.
William Schwitter, Partner, Paul, Hastings, Jonofsky & Walker
Mr. Schwitter is a partner in the corporate practice of Paul Hastings in New York. He was the chair of the firm’s Global Corporate Department from 2000 to 2005 and is currently the co-chair of the firm’s Global Securities and Capital Markets Practice Group. Mr. Schwitter has a diversified corporate practice with extensive experience in the areas of corporate finance and securities law.
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