Gambit’s Debt Capital Markets Review for January 2023 examines the latest developments in the debt markets, providing insight into the domestic lending landscape and analysis of the current key trends and considerations for mid-market companies when assessing current borrowing and capital requirements.
– The balance of power between borrowers and lenders has changed, with a ‘flight to quality’.
– Leverage multiples and terms have tightened, with more scrutiny and dialogue on debt capacity, sensitivity analysis and covenant headroom.
– The cost of debt is ticking up driven by both increased underlying base / SONIA rates and the funder interest margin applied.
– In this evolving economic landscape, whilst traditional sources of finance might have reduced appetite, the alternative debt market remains very much open, with 38% of European private debt funds expecting deal activity to increase from 2022 to 2023.
– Leveraging the expertise of a knowledgeable debt advisor to support a quality proposal to present to the most relevant funder audience, is key to achieving a successful fundraise in this dynamic market.
To read the full report, click here.