Optimal capital structure and Pricing grid: Difference between pages

Revision as of 16:34, 25 July 2015

A clause in a loan document which links the pricing of the borrowing to the credit rating of the borrower.

Also known as a 'ratchet'.

@@ Line 1: / Line 1: @@
-.
+A clause in a loan document which links the pricing of the borrowing to the credit rating of the borrower.
-The capital structure which results in the lowest Weighted Average Cost of Capital (WACC).
+Also known as a 'ratchet'.
-.
-The most appropriate capital structure taking account of both:
-* The immediate cost saving benefits of a low WACC.
-* The potential flexibility and safety benefits of a more conservative capital structure (with a relatively lower proportion of debt finance).
 == See also ==
-* [[Capital structure]]
+* [[Credit rating]]
-* [[Modigliani and Miller]]
+* [[Ratings trigger]]
-* [[Pecking order theory]]
+* [[Rating grid]]
-* [[Weighted average cost of capital]]
-* [[MCT]]
-[[Category:Corporate_finance]]
+[[Category:Treasury_operations_infrastructure]]
-[[Category:Long_term_funding]]