Mezzanine & Subordinated Debt
Subordinated and mezzanine debt that bridges senior debt and equity.
Image · Mezzanine & Subordinated DebtMezzanine and subordinated debt sit between senior debt and equity in the capital stack, offering higher leverage for a higher coupon, often with warrants or an equity kicker. Matchpoint structures mezzanine for acquisitions, growth and real assets.
As part of our Debt practice, Matchpoint Partners has originated and led $2+ billion of transactions across four continents, and every debt mandate is led by a partner, from first call to close.
The central mandate decision. Use subordinated capital only where its flexibility creates more value than its higher pricing and structural complexity. The instrument should bridge a genuine funding gap while leaving a credible path to repayment or refinancing.
What capital providers or counterparties will test
Enterprise-value support, senior-debt headroom, cash interest capacity, payment-in-kind accrual, intercreditor terms, equity cushion, exit timing and downside recoveries.
How the mandate is structured
Mezzanine may include cash interest, PIK interest, warrants or an equity kicker. Its ranking, standstill, enforcement and cure rights must be coordinated with senior lenders and shareholders.
Execution priorities
Model total cost through the expected exit date, negotiate the intercreditor position early and test whether preferred equity or a larger equity cheque produces a cleaner outcome.
Prepare before approaching the market
- Enterprise valuation and downside case
- Senior and subordinated debt schedule
- Cash-interest and PIK accrual model
- Draft intercreditor and security principles
Our role on mezzanine & subordinated debt mandates
- Subordinated and mezzanine tranches
- Higher leverage above senior debt
- Warrants / equity-kicker structures
- Acquisition, growth and real-asset uses
Research relevant to this area
Original analysis and decision frameworks from the Matchpoint team.
Mezzanine & Subordinated Debt — frequently asked questions
To increase total leverage and reduce equity required, between senior debt and equity.
A higher coupon than senior debt, sometimes with an equity participation.
Yes. Mezzanine is designed to sit behind existing senior debt, governed by an intercreditor agreement that ranks payments and security between lenders. The senior lender’s consent is normally required, and senior documents must permit the additional debt — points we negotiate so both layers of the structure work together.
An equity kicker gives the mezzanine lender a share of the company’s upside — usually warrants or a conversion right over a small equity stake — in return for ranking behind senior debt. It lifts the lender’s overall return while keeping the cash coupon lower than the risk would otherwise demand.
Mezzanine suits owners who want additional capital without meaningful dilution and whose cash flows can support a coupon priced above senior bank debt. It works well for acquisitions, buy-outs and growth where senior capacity is exhausted; if cash flows are uncertain or leverage is already high, equity is usually the sounder route.
Matchpoint originates senior, mezzanine, hybrid and structured debt from regional banks, international lenders and private credit funds, structured around your transaction. Tickets range from USD 5m to USD 500m+.
Private credit is non-bank lending from specialist funds, typically senior or unitranche, offering speed and flexibility. We maintain relationships with private credit funds active in the GCC and India.
Yes. We structure Sukuk and Shariah-compliant private credit, including blended structures pairing a Sukuk tranche with conventional debt.
Engagements ordinarily combine a retainer with a success fee. Terms are agreed in writing before work begins and calibrated to the mandate’s size, scope and complexity.
Most mandates reach a first term sheet within 30 days, depending on diligence readiness and structure; closing follows once terms are agreed.
A short, confidential scoping call and NDA; we structure the requirement and prepare materials, then run a competitive process across our 5,000+ investor and lender relationships, and negotiate to close — with a partner leading at every step.
Matchpoint Partners is based in the UAE and runs cross-border mandates across the UAE, KSA, India and the UK, with active deal activity in wider Europe, Singapore and the United States.
Matchpoint undertakes corporate finance, financing, M&A and fund-placement mandates from USD 5m upwards, subject to mandate fit, diligence, applicable regulation, capacity and a written engagement. The partner team has originated and led $2+ billion of transactions.
Use the enquiry form, email contact@matchpoint-partners.com, or call/WhatsApp +971 52 345 1119. Every mandate is led by a partner from the very first conversation.
Yes. Confidential information is handled under the engagement terms and any applicable non-disclosure agreement.
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Investment roles, structures and decision criteria
Explore the participants and transaction options relevant to this practice. Each entry sets out a discussion scope, decision checks, a paid engagement starting point and the specialist responsibilities to confirm.
Banks and Direct Lenders
Mezzanine LendersCME-059 · Banks and Direct Lenders · Debt Lender
- Ecosystem role
- Debt Lender
- Related asset class
- Private credit
- Instrument context
- Senior debt
Mandate context: corporate, acquisition and working-capital financings. The structure and rights are established by the specific transaction documents.
Decision focus: Repayment capacity and financing conditions.
- Borrower authority, debt and use of funds
- Cash-flow repayment and covenant sensitivities
- Security, ranking and approval conditions
Scope to discuss: Lender advisory, independent credit underwriting and financing execution.
Paid engagement entry point: independent credit-screening memorandum; followed by underwriting, structuring or portfolio monitoring.
Illustrative GCC scenario: An illustrative UAE acquisition loan can be screened using the borrower's cash-flow case, existing obligations, proposed security and the lender's credit-approval requirements. This is a hypothetical decision example.
What should be agreed before a mandate involving Mezzanine Lenders?
Define the investment or transaction objective, the authorised decision-maker, the evidence available, the requested deliverables and the next approval. Use the decision checks above to identify gaps; agree the workplan, delivery responsibilities and fee terms in writing.
Delivery and specialist boundary: Confirm decision authority, evidence access, conflicts, scope and applicable jurisdiction-specific permissions before execution. Legal, tax, fund-marketing, securities and Shariah questions require the relevant appointed specialist. Capital availability, investment returns and execution dates remain subject to assessment.
Discuss a paid scopePrivate Capital
Mezzanine DebtCME-154 · Private Capital · Asset Class
- Ecosystem role
- Asset Class
- Related asset class
- Private markets
- Instrument context
- Equity or debt
Mandate context: equity, credit and private-company investment strategies. The structure and rights are established by the specific transaction documents.
Decision focus: Economic exposure and downside assumptions.
- Underlying business or borrower evidence
- Cash-flow rights, leverage and valuation
- Liquidity, governance and exit or repayment routes
Scope to discuss: Private-markets portfolio strategy, manager selection, diligence and transaction access.
Paid engagement entry point: allocation and market-opportunity study; followed by manager or asset screening and diligence.
Illustrative GCC scenario: An illustrative GCC private-capital comparison can evaluate equity and credit exposures on a consistent set of cash-flow, governance and liquidity assumptions. This is a hypothetical decision example.
What should be agreed before a mandate involving Mezzanine Debt?
Define the investment or transaction objective, the authorised decision-maker, the evidence available, the requested deliverables and the next approval. Use the decision checks above to identify gaps; agree the workplan, delivery responsibilities and fee terms in writing.
Delivery and specialist boundary: Confirm decision authority, evidence access, conflicts, scope and applicable jurisdiction-specific permissions before execution. Legal, tax, fund-marketing, securities and Shariah questions require the relevant appointed specialist. Capital availability, investment returns and execution dates remain subject to assessment.
Discuss a paid scopeDebt and Asset Finance
Mezzanine DebtCME-227 · Debt and Asset Finance · Funding Instrument
- Ecosystem role
- Funding Instrument
- Related asset class
- Private credit
- Instrument context
- Debt or asset finance
Mandate context: corporate, project, asset and acquisition financing. The structure and rights are established by the specific transaction documents.
Decision focus: Cash obligations and risk allocation.
- Pricing, tenor and repayment obligations
- Collateral, covenants and priority
- Sensitivity to delays, cash shortfalls and refinancing
Scope to discuss: Capital-structure design, financing options analysis and execution support.
Paid engagement entry point: financing-options and term-sheet assessment; followed by lender or investor process execution.
Illustrative GCC scenario: An illustrative Saudi funding proposal can compare repayment, security, covenant and refinancing terms on common cash-flow assumptions before specialist documentation review. This is a hypothetical decision example.
What should be agreed before a mandate involving Mezzanine Debt?
Define the investment or transaction objective, the authorised decision-maker, the evidence available, the requested deliverables and the next approval. Use the decision checks above to identify gaps; agree the workplan, delivery responsibilities and fee terms in writing.
Delivery and specialist boundary: Confirm decision authority, evidence access, conflicts, scope and applicable jurisdiction-specific permissions before execution. Legal, tax, fund-marketing, securities and Shariah questions require the relevant appointed specialist. Capital availability, investment returns and execution dates remain subject to assessment.
Discuss a paid scopeFurther reading on diligence, market frameworks and applicable requirements. These resources do not verify an individual mandate or Matchpoint permission.
