Leveraged Finance Workshop

FitchTraining
Hong Kong, China

Course Format: Classroom | E-learning | Virtual Class | Online | On-site | Blended | Self-paced

Course Description:

'' Participants will be equipped to:
Apply analytic tools to identify potential candidates for leverage
Understand the motivations of the various parties to a transaction and how this can drive capital structures
Understand how changing market conditions are likely to affect structures in the market place
Use forecasts of the key cash flow drivers to determine an appropriate debt quantum and the relationship between amortising and non-amortising debt
Understand the relative advantages and disadvantages of various debt instruments and understand the factors affecting their availability: including senior debt, second lien, mezzanine, high yield notes and PIK notes
Structure leveraged transactions combining different debt instruments
Be aware of the key terms and conditions of senior and subordinated debt
Understand the key elements of an intercreditor agreement and how the inter-relationships of the debt providers are governed
Understand why and how recapitalisations are used by sponsors and the effect they have on lenders

Target Audience
Experienced banking and finance professionals responsible for credit risk management, marketing, structuring or evaluating leveraged transactions.

FitchTraining offers programmes at an intermediate level and advanced level of continuing education. Although no prerequisite courses or experience is required to participate in this programme, working knowledge of financial statement analysis is required, as well as prior knowledge of the programme topic.

Content
ANALYTIC OVERVIEW
Introduction
Using leverage - the rationale
Market trends - leverage multiples, capital structures, parties and instruments
Current market conditions: fall-out from the US sub-prime mortgage crisis
Definitions - primary buy-outs, secondary buy-outs, dividend recapitalisations & etc.
Key Players - parties to the transaction and their motivations
Purpose payback
Using purpose payback concepts to understand structures of different classes of debt
Cash flow
Asset sales
Refinancing
Instruments
Overview of the structural features, required market conditions and pricing of LBO instruments and how these are changing
Bank debt products used in leveraged transactions - alphabet loans, revolvers, working capital, bridge finance, acquisition, restructuring and CAPEX lines
Intermediate capital and hybrid products - high yield, warranted and warrantless mezzanine, second lien, vendor notes, PIK notes
Equity - types of equity and their impact on debt providers
IDENTIFYING CANDIDATES AND FORECASTING PERFORMANCE
Characteristics of an "ideal" LBO - identifying candidates for leverage
Identifying key drivers within the company cash flow
Modelling performance - building assumptions, sensitising forecasts and benchmarking
STRUCTURING LEVERAGED BUY-OUTS
Using forecasts to determine the capital structure
Using cash flow forecasts to determine debt capacity
Balancing amortising and non amortising debt structures
Quantifying and pricing acceptable levels of refinancing risk
How exit strategies (trade sales, IPOs, secondary and tertiary buy-outs and recapitalisations) influence capital structures
Estimating the impact of funding structures on issuer default and recovery ratings
Secondary buy-outs and refinancings: market conditions needed and impact on debt quantum and structure
Debt profile
Structuring debt: amount, currency, tenor, drawdown and amortisation profile
Impact of the institutional investor
Financing capex, acquisitions, working capital
Use of securitisations, sale and leaseback, borrowing base facilities to maximise debt quantum
Assessing asset quality and assigning "haircuts" to determine loan amounts
Devising and monitoring effective borrowing base structures
Structuring bridge facilities
Combining bank debt with intermediate capital
Seniority
Defining ranking - contractual (legal), structural and constructive subordination
Establishing and maintaining ranking within the capital structure
The impact of alternative funding products on senior lenders - evolving market conventions
Terms and conditions
Senior debt covenant packages - "standard" terms and conditions
The development of "covenant light"
Special circumstances - the need for customised commercial and financial safeguards
Understanding the terms and conditions of subordinated debt
Examining the interrelationship between senior debt, stretched senior and other subordinated instruments
Pricing
Pricing conventions in the leveraged market - fees, cash and deferred margins, warrants etc.
Assessing risk~return profiles
Exploiting value in the capital structure.
...''

Phone:+ 44 (0) 20 7201 2770

School Address:

28 Headfort Place, London, SW1X 7DH, United Kingdom.


Jobs & Resumes: Hong Kong
Houses & Roommates: Hong Kong
Travel Agencies: Hong Kong

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