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The Power Of Mezzanine Debt

The Power Of Mezzanine Debt

Submitted by • March 2, 2020 www.attractcapital.com

Mezzanine debt is a widely available yet infrequently used outside of leveraged buyouts in the middle market company ecosystem. It is a layer of financing between the bank loan and equity, needed to complete the capital stack and close the deal. Mezzanine debt is a hybrid type of capital and possesses elements of a loan as well as an equity investment. As a hybrid, it is highly flexible and valuable for middle market companies of all stages. While a buyer of a business has an obvious need for this type of capital, any middle market company seeking growth can put mezzanine debt to profitable use. The key to understanding how to use mezzanine debt and its power is to first understand how it is different than other loan.

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