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Company Refinancing

Company refinancing is an approach by which a business can replace or restructure its existing debt in order to reorganise its financial obligations. Company refinancing has a number of objectives, including lowering monthly interest payments, locating loans with better terms, lowering risk, and gaining access to more money.

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Company refinancing involves significant financial and legal considerations, and mistakes or oversights can lead to costly legal disputes or financial setbacks. Engaging a solicitor from P.A. Duffy and Co, with experience in corporate finance and legal documentation, ensures that the refinancing process is legally sound, your interests are protected, and potential risks are minimised. The expertise of our solicitors is invaluable in navigating the complexities of the refinancing process.

Company refinancing can be undertaken for several reasons, including:
  • Lowering Interest Costs: One of the primary reasons for refinancing is to take advantage of more favourable interest rates in the market. By refinancing existing debt at lower rates, a company can reduce its interest expenses, which can improve profitability.

  • Extending Maturity: Refinancing allows a business to extend the maturity date of its debt obligations. This can provide greater flexibility and reduce the immediate financial strain associated with debt repayment.

  • Improving Debt Structure: Companies may refinance to change the structure of their debt. For example, they might convert short-term debt into long-term debt to match the financing with the life of the assets being funded.

  • Reducing Debt Service: Refinancing can lead to a reduction in debt service payments, making it easier for a company to manage its financial obligations and maintain liquidity.

  • Consolidation: Businesses with multiple debt obligations may refinance to consolidate them into a single, more manageable loan or credit facility.

  • Access to Additional Capital: Refinancing can provide an opportunity to access additional capital. For example, a company may refinance an existing loan with a higher principal amount, giving it access to additional funds for business expansion or investment.

  • Improved Financial Flexibility: By adjusting the terms and covenants of debt agreements, refinancing can provide a company with greater financial flexibility, allowing it to adapt to changing market conditions.

  • Debt Covenant Relief: Companies facing financial difficulties may refinance to obtain relief from restrictive debt covenants or to negotiate more lenient terms with creditors.

 How our solicitors can help

Solicitors play a crucial role in assisting with company refinancing by providing legal expertise and support throughout the process. Our solicitors will conduct a comprehensive review of your existing financial and legal obligations to assess the legal risks associated with your current financial arrangements and then work proactively to progress refinancing your company.

You will find us easy to contact if you have any questions or you need support from us at any time. Speak to our commercial solicitors in Dungannon and Belfast, and call us on 028 87722102. Alternatively, you can fill in our online Contact Form and we will ring you.

FAQs

Do all companies qualify for refinancing?

Qualification for refinancing depends on a company's financial health, creditworthiness, and the willingness of lenders to offer favourable terms.

Is it necessary to involve a solicitor in company refinancing?

The Lender will usually require the Company to have appointed a Solicitor to act on behalf of the Company and in some cases act on behalf of the Lender also.

How can I finance a solicitor for company refinancing?

We know that funding might be a worry, so we offer a range of options. These include:

  • Legal expenses cover

  • After the Event insurance (ATE insurance)

  • Private payment

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Our Corporate Finance & Banking Solicitors

Kieran QuinnKieran QuinnDirector
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