This is an advanced corporate finance class designed to help students develop expertise on the main topics of leveraged finance: credit origination, credit investing, capital structure, corporate debt, credit cycles, credit default swaps, and restructuring. The leveraged finance market constitutes over $3 trillion of assets outstanding in the United States alone, and it is growing rapidly.
We will do a deep dive into the type of debt instruments issued by firms: syndicated (leveraged) loans, high yield bonds, revolving credit facilities, mezzanine debt, and convertible bonds. We will also cover the main institutions that originate such debt, including investment banks, private credit (direct lender) funds, and opportunistic credit funds. The middle part of the course focuses on drafting credit investment memos, where students investigate a company in detail to make a recommendation on originating a credit or investing in a credit in the secondary market. The last part of the course covers the rich strategic actions taken by investors in the leveraged finance market, including liability management exercises (LMEs) and the details of out-of-course restructuring (distressed debt exchanges) and in-court restructuring (Chapter 11).
This class is designed for students in all finance and consulting fields, but with a particular focus on those who want to work in financial management of firms, private credit, private equity, banking, corporate restructuring, turnaround advising, or fixed income investing. Many law students also take the class, given the heavy overlap of finance and legal considerations in this area.
