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| Oct. 9 2005, 1:09 PM ET |
public post by JJR (16  )
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Msg URL: http://www.bdcinvestor.com/forums/show.mpl?keywords=1128877760.93.3939604131698&so=200510
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Topic: ACAS
Re: This following is an ACAS deal, I'm cur... --
tennee, good to hear that Gibson's management is highly regarded. Management is always a key ingredient in these financing deals and it's usually the missing piece of the puzzle that's difficult to ascertain from an investor's point of view.
I would suspect a second lien loan that may be at least partially asset backed to garner a lower interest rate than a typical cash flow mezz loan, but I wonder how much lower. If the senior revolver is backed with a good portion of intangibles, there may not be much in the way of tangible asset backing for the second lien loan, so in essence it is a cash flow loan without the upside reward.
Don't knock yourself out asking around for the loan rate, it should be in the next 10Q. I know the competitive market place has forced lenders to lower their hurdle rates, just wondering about the long-term implications.
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