Game. Set. Match: A younger, nimbler Carlos Alcaraz unseated King Djokovic to conquer Wimbledon…and so bounces the ball in the credit markets, where the new champions are agile and sometimes less conventional groups – ranging from family offices to hedge funds – who bring flexibility and speed of execution to a challenging financing environment.
- Capital allocators are rebalancing toward credit strategies in private markets, bringing increased levels of creativity to solve financing needs. Floating rate, fixed rate, payment-in-kind – the menu of options for borrowers continues to broaden.
- Direct lenders have stepped up to the plate to finance M&A deals, as banks were sidelined to offload hung deals and reassess their risk appetite.
- Nonetheless, the last few months have seen signs of revival in bank lending, both across mega cap and middle market deals. Stabilization of rates helped alleviate interest rate risk, allowing for an emergent risk-on appetite. But progress is slow.
- Meanwhile, an upcoming wave of debt maturities ensures that leveraged finance activity is set to accelerate. Borrowers should expect to navigate economic headwinds, high borrowing costs, and elongated diligence processes. Planning ahead has never been more critical.
Connect with Our Team
- Jonathan Zucker, Managing Director, Head of Capital Advisory, jzucker@IntrepidIB.com
- Boris Zikratov, Director, Capital Advisory, bzikratov@IntrepidIB.com
- Stephen Senior, Associate, Capital Advisory, ssenior@IntrepidIB.com