Introducing Management Fee Credit Facilities

Law360, New York (February 11, 2014, 3:01 PM EST) -- As the subscription credit facility market matures,[1] lenders seeking a competitive advantage are expanding their product offerings to private equity funds (funds) from traditional capital call facilities made to closed-end funds to other financing products, including lines of credit to open-ended funds, separate-account vehicles and net asset value facilities.[2]

Another emerging product gaining traction in the market with some fund sponsors is a so-called management fee credit facility (a facility). A facility is a loan made by a bank or other financial institution to the general...
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