What is a loan primer?
A syndicated loan is a commercial loan provided by a group of lenders and structured, arranged, and administered by one or several commercial or investment banks known as arrangers.
What is club deal in a syndication?
The third type of loan syndication is the ‘club deal’. This type of syndication typically involves a smaller loan amount and the lead bank or agent and other lenders of the syndicate share equally, or nearly equal portions of the fees earned from the loan.
What is the difference between a loan participation and a loan syndication?
With participations, the contractual relationship runs from the borrower to the lead bank and from the lead bank to the participants, whereas with syndications, the financing is provided by each member of the syndicate to the borrower pursuant to a common negotiated agreement with each member of syndicate having a …
What is the difference between high yield and leveraged loans?
Speculative-grade loans are called “leveraged loans.” Speculative-grade bonds are called “junk” or “high yield.” Loans: Term loans and revolvers issued privately by banks and institutional investors. Speculative-grade loans are called “leveraged loans.”
What is a club deal in financing?
A club deal refers to a private equity buyout where several private equity firms pool their assets to acquire a company. Club deals allow private equity firms to collectively acquire expensive companies they normally could not afford and spread the risk among the participating firms.
What is TLA loan?
A senior term loan that usually matures within five to six years. If there is a revolving credit loan under the same credit facility, the final maturity of the TLA may be the same or one year later than the final maturity of the revolving credit loan.
What is a TLB loan?
Also referred to as a Term B Loan or an institutional term loan. A term loan made by institutional investors whose primary goals are maximizing the long-term total returns on their investments. TLBs may provide that the Term B Lenders have the right not to accept prepayments of the loans.
What is a club deal syndicated loan?
It should be noted that a club deal syndicated loan is often a smaller amount loan ($25 – $150 million) that is pre-marketed to a group of relationship lenders in which the main feature is that the lead agent and other members of a club deal consortium all share equal, or nearly equal, parts of the fees earned from the loan facility.
How much is a club deal loan worth?
Club Deal This type of syndication usually entails a smaller amount, typically between $25 and $150 million. The main feature that makes this type of syndicated loan unique is the fact that the lead agent and other members of a club deal consortium all share equal, or nearly equal, parts of the fees earned from the loan facility.
What are the features of a syndicated loan?
The main feature that makes this type of syndicated loan unique is the fact that the lead agent and other members of a club deal consortium all share equal, or nearly equal, parts of the fees earned from the loan facility. 3. Best-Efforts Syndication Deal
What is a best efforts syndication loan?
Best-Efforts Syndication Deal Of all the types of syndicated loans, the best-efforts syndication is the most commonly used in the United States. Under this arrangement, the lead agent does not commit or guarantee the entire amount of the loan.