Restructuring Activity in Europe

The restructuring activity in Europe has been slower and more gradual than initially anticipated. While there is still distress in the market and fragility within corporates, the wave of traditional loan-to-own restructuring transactions has not materialized. Instead, there has been more restructuring in the small to mid-cap space, where companies are more fragile, and the documentation is more vulnerable to increases in rates. Certain sectors like real estate and cyclical industries such as chemicals and building materials have experienced more distress and restructuring opportunities. However, larger cap sponsors and corporations have seen less activity, with many looking to protect their investments through additional financing.