easy · Debt Capital Markets
What is the primary economic function of a bridge loan in a corporate acquisition?
- To provide equity capital that reduces the overall leverage of a leveraged buyout.
- To serve as a long-dated, low-cost debt instrument that remains in the capital structure for over ten years.
- To provide temporary, interim funding that ensures a transaction can close before permanent financing is secured.
- To eliminate the need for an investment bank to underwrite the final bond issuance.
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