Unitranche Debt

Definition

A hybrid lending structure that combines senior and subordinated debt into a single facility with a single blended interest rate, simplifying the capital structure and reducing negotiation complexity. Unitranche facilities are provided by a single lender or lending group and eliminate the need for separate intercreditor agreements between senior and mezzanine lenders. They have become increasingly popular in mid-market leveraged finance, particularly for transactions valued between £20 million and £500 million.