
September 21, 2023
Corporates May Need to Add Sugar to Recipe for Bonds Funding M&A
Investors may demand better terms in special mandatory redemption clauses amid longer deal review times and rate cut risk. Treasury teams structuring bond deals to fund M&A transactions who want to lock in rates before an acquisition closes may need to sweeten the terms of a clause in bond offerings called a special mandatory redemption. The key reason: increased risks for investors stemming from longer regulatory reviews of mergers and the possibility that deals fall apart. SMRs typically require an issuer…