medium · Debt Capital Markets primary-issuance-syndication
An investment bank provides a $500 million 'bridge-to-bond' facility to facilitate an acquisition. The bridge has an initial interest rate of L+450 and steps up by 50 bps every three months. If the bank is unable to syndicate the bonds for 9 months, what is the interest rate on the bridge facility? Assume LIBOR is 2.00%.
- 7.50%
- 6.50%
- 9.50%
- 8.00%
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