Capital structure: Difference between revisions
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{{g}}Of a {{csaprov|corporation}}, the arrangement, priority and ranking of its [[shareholder]]s, [[creditor]]s and [[debenture]]holders. | {{g}}:''They asked me for my place in the capital structure. I said I was [[senior unsecured]]. They fired me for insubordination.'' | ||
::—{{author|Hunter Barkley}}, {{br|The ISDA Protocol}} (as yet unpublished) | |||
Of a {{csaprov|corporation}}, the arrangement, priority and ranking of its [[shareholder]]s, [[creditor]]s and [[debenture]]holders. | |||
Usually, common shareholders at the bottom, then preferred shareholders, then [[subordinated debt|subordinated]] creditors, then unsecured (aka “ordinary”) [[Creditor|creditors]], then [[Secured loan|secured]] creditors. | Usually, common shareholders at the bottom, then preferred shareholders, then [[subordinated debt|subordinated]] creditors, then unsecured (aka “ordinary”) [[Creditor|creditors]], then [[Secured loan|secured]] creditors. | ||
Revision as of 10:17, 23 August 2020
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- They asked me for my place in the capital structure. I said I was senior unsecured. They fired me for insubordination.
- —Hunter Barkley, The ISDA Protocol (as yet unpublished)
Of a corporation, the arrangement, priority and ranking of its shareholders, creditors and debentureholders.
Usually, common shareholders at the bottom, then preferred shareholders, then subordinated creditors, then unsecured (aka “ordinary”) creditors, then secured creditors.
That kind of thing.
When you have a convoluted corporate structure — hey: who doesn’t? — then the arrangement between the various entities in your group of shareholdings, inter-company loans, parental guarantees and so on can be quite the game of pan-dimensional chess.