The Risks of Trading Private Equity Preference for Bank Debt

When things go south, if you've traded private equity preference for bank debt, again, that bank debt sitting at the top of the stack. If they have a bank involved, they may not have a choice. The bank's going to say you need to do these three things. In the private equity firm, we don't want to do any of those things. That's the risk. You introduce a third party who is a, who is, has rights above your rights. And all they care about is a downside and there's a private equity owner. You care about the upside.