Steve Deedy managing director of AlixPartners, James Epstein partner at Pepper Hamilton LP, Ken Hanau, a managing partner at 3i US, and Randy Schwimmer, senior managing director and head of capital markets of Churchill Financial spoke at The Deal Economy 2010 conference. In this video they speak about the wall of leveraged buyout debt from deals in 2006 and 2007 that is due in two years.
The difficult economy has more dealmakers turning to earnouts and contingent value rights to bridge valuation gaps. Including milestone payments or shares based on predetermined outcomes offers comfort to buyers worried they are overpaying in a volatile market and sellers who believe their assets are worth more than the asking price. William Venema, an attorney with Epstein Becker & Green PC says while these deal structures can help get parties to close, they can also increase the risk of post-close litigation. - Suzanne Stevens
CIT Group's bankruptcy left many wondering about its impact on middle market lending. James Epstein, a partner with Pepper Hamilton LLP, says fallout was minimal for two reasons: The filing came just as the credit markets began to thaw, and there were plenty of lenders ready to step into the breach. - Suzanne Stevens
