Intercreditor agreements in acquisition finance

Subordination may be used in certain finance transactions as a way of changing the priority of claims against a debtor often to ensure that repayments of any intra-group loans rank behind repayments of debt provided by external creditors and to govern the relationship between a range of external creditors providing debt to the same debtor. This guidance details the two main ways of achieving subordination in commercial transactions are by “contractual subordination” and “structural subordination”.

This guidance also outlines the key purpose and commonly negotiated provisions of an intercreditor agreement in acquisition finance transactions.

See Intercreditor agreements in acquisition finance.