medium · Corporate Credit Analysis cap-structure
A corporate group, Global Systems, uses a 'Double Dip' financing structure. HoldCo issues $200M in notes and loans the proceeds to OpCo via an intercompany note. OpCo also provides a guarantee on the HoldCo notes.
In an OpCo liquidation valued at $150M with $300M in other OpCo claims, how many claims does the HoldCo noteholder have against the OpCo pool?
- Two (Intercompany Note + Guarantee)
- One (Residual Equity)
- One (Direct Note)
- Zero (Structural Subordination)
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