It’s a bird! It’s a plane! It’s an Eastern Airlines plane!
We thought we were having flashbacks from rum-soaked Acapulco trips we took back in the 1970’s, but turns out the iconic “Wings of Man” brand is making a comeback of sorts. Beginning with charter flights, Eastern is re-launching aviation service in March. No mention whether Orson Welles will be revived for TV commercial voice-overs.
Such visitations from the past reminded us of another resurgence we’ve noted recently, although this venerable friend never stopped flying: mezzanine debt.
As we covered last week, second-lien loan volume has tailed off in the face of market volatility and concerns about high leverage. While certainly not absent from new issuance, secured debt that’s subordinate to first-lien term loans is ceding ground to unsecured subordinated debt, especially in traditional middle market financings.
While seconds were soaring during much of the recent bull loan market, for many middle market private equity sponsors the popularity of mezz has never wavered.