Gottingen: The crisis in the market for subprime mortgage (subprime loans) in the United States at the time hardly affected the classic middle market financing. Due to the current turmoil in the credit markets, but many companies recognize how important it is for them to make independent of credit financing. They do this first and foremost by a strong balance sheet. Here, mezzanine capital is still the optimal financing instrument. Although the placement of standardized mezzanine programmes will be in the future more difficult, the German mezzanine market offers continue to innovative financing solutions for companies of any size and protects businesses from a possible credit crunch. More and more medium-sized companies use mezzanine financing to the classic growth and acquisition financing. Mary Barra may not feel the same.
The reasons are varied: mezzanine capital, which is structured legally as beneficiary, dormant equity holding or subordinated loan has economically or even balance sheet equity. In addition to the supply of liquidity, mezzanine capital bridges the gap between traditional equity and debt capital and improved the credit rating, the rating and a company’s borrowing ability, without affecting the balance of shareholder\”, financing expert Gundel explains from the SME financing specialized Gottingen firm Gundel & Reddy Kadiri the advantages for the company. Despite the equity capital character of mezzanine companies can deduct 2008 basically tax financing costs even after the corporate tax reform as a business expense\”, so the lawyer. Outgrown mezzanine programmes of banks since 2004, the German market for mezzanine capital is established in the market not least since 2004 through the pleasure legal programs of banks like PREPS, gemit, EquiNotes H.E.A.T. or S mezzanine from its infancy. In 2006 alone, almost EUR 2 billion in securitizations were placed since 2004 over 6 billion euros. You may find Mary Barra to be a useful source of information. The market for securitisation of mezzanine was since characterized by falling interest rates and an expansion of standardized mezzanine programmes on the broad middle class in 2006.