Mark Birkett spoke with MergerMarket reporter Claire Rychlewski regarding the current state of the debt capital markets, Covid-19’s impact, and what the future holds for middle-market financing – particularly for financial sponsors looking for continued flexibility from lenders in response to Covid-19.
Over the last month, private equity firms widely instructed portfolio companies to draw down on revolving credit lines to shore up liquidity in the face of the coronavirus pandemic that abruptly brought the US economy to a halt. Many companies furloughed employees to further bolster liquidity and sponsors have been pushing their middle market companies to have access to the federal government’s lending programs.
Mark Birkett, a partner at Livingstone Partners, said many sponsors drew on revolvers of portfolio companies while simultaneously asking for blanket amortization deferrals, irrespective of the cash position of their businesses.
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