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The New Trend: The novel provision goes, but the broader flexibility stays
Earlier in the week, I wrote about how Recordati could not only sell Specialty & Primary Care or Rare Diseases, each about half of group EBITDA, with no change of control put, no size limit other than “not both” and no time limit, but the sale would also unlock a redemption right at 102%.On October 29th, after lender pushback on the provision, and the flexibilities more broadly, the borrower published a raft of changes tightening terms - including removing the 102% call.The other provisions around the sale persist - alongside what remains a very flexible set of covenants. The pattern - extremely loose protections, including novel provisions which are ultimately removed leaving a still-borrower-friendly covenant package - is the same in all three.
