White & Case Debt Finance partner David Ridley is quoted in the Financial Times on the upcoming transition deadline for Libor, which expires on June 30.
The story notes that approximately US$700 billion worth of leveraged loans are still priced using Libor, as economic and market strains throughout the past year have hindered the flow of the transition. While progress has accelerated in recent months, the deadline is still rapidly approaching for corporate borrowers to make the switch to the secured overnight financing rate to ensure they will not fall back to potentially less favorable borrowing terms.
Ridley says, "I expect everyone across the spectrum — banks, law firms, private equity companies and their portfolio companies — everyone will be impacted and busy doing what they can to transition their portfolio of deals by the end of the month," pointing to "a lot of paperwork."
Due to slowed dealmaking activity, "the natural opportunity to transition via some larger transaction…effectively dried up during the course of last year," Ridley notes.
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