Adams Street Partners -Fri, 05/24/2024 - 19:12

The Advantages of Being a Lead Lender: Bill Sacher Q&A

Key Takeaways

The designation of lead lender often confers significant advantages for a private credit manager, including privileged access to data and influence over capital structure, covenants and loan terms
Private equity deal sponsors in a middle market company auction bring in lead lenders at the outset of the underwriting process, typically two to three months before a transaction closes, while club participants have only a few weeks to conduct their deal diligence
Lead lenders typically have greater access to the raw data that the company provides as part of the sale process; enjoy more management interactions; and have early access to third-party consultant work that pressure tests key metrics including quality of earnings, market analysis, and other potential risks
Underwriting advantages derived from lead lender status can drive superior risk-adjusted returns and mitigate potential losses, while the extra work undertaken by lead lenders can result in incremental fees

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Adams Street Partners is a global investment firm managing a comprehensive suite of private markets investment solutions. The firm provides private equity and private credit strategies to institutional investors, growth capital to innovative companies, and evergreen funds that offer access to multiple strategies through a single, investor-friendly commitment. The firm also supports wealth advisors with private markets solutions structured to be more flexible and accessible than traditional closed-end funds. With over 50 years of experience, Adams Street leverages deep market insights, global relationships, and proprietary data as it seeks to help investors achieve long-term investment goals. The firm is 100% employee-owned, manages nearly $70 billion in assets, and operates out of 15 offices globally. Visit adamsstreetpartners.com

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Vice President, Investor Relations
nhameer@adamsstreetpartners.com
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