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Clifford Chance

Clifford Chance


Coronavirus: Leveraged Finance - Key Considerations in Respect of Loan Buybacks and Other Liability Management Transactions

April 6, 2020

The Coronavirus pandemic continues to significantly impact global markets, resulting in price reductions for corporate loans such that many of those loans are now trading below par, some significantly so. As of April 2, 2020, no single loan on the S&P/LSTA Leveraged Loan Index was trading above par, with less than 1% of loans bid above 98. Debt buybacks and other liability management options are on the minds of a number of investment banks, borrowers and their financial sponsors. Here, we discuss similar liability management options that borrowers, their affiliates and their private equity sponsors are currently exploring in respect of their loans.

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