News & Insights

Client Alert

September 27, 2022

Utilizing Structured Finance Techniques in Distressed Situations

Securitization, and structured finance generally, is a critical capital-raising tool for many companies. Utilizing one or more bankruptcy-remote special purpose entities to legally isolate the credit risk of quality, securitizable assets from the credit risk of the company itself can help raise capital at more favorable rates, on better terms, and from a broader investor base than may otherwise be available absent a securitization structure. In addition to legal isolation, structured finance generally employs credit enhancements and structural features that may provide additional opportunities to help finance a company facing a distressed situation.

This client alert illustrates how securitization techniques and mechanisms may provide an important addition to the toolkit for companies, as well as for credit providers considering their options with distressed credits.

View the rest of the client alert here.