Unitranche
A single blended debt facility combining senior and subordinated debt into one instrument at one blended rate, popular in mid-market PE deals.
Also known as: Uni-tranche, All-in-one facility
One-line definition
Unitranche replaces the senior/mezz stack with one lender, one document, one blended rate — simplicity at a cost premium over pure senior.
Why it has grown
- Speed: one set of lender negotiations.
- Flexibility: fewer covenants, covenant-lite structures.
- Mid-market friendly: ticket sizes €20m–€500m.
Trade-off
The all-in cost is higher than pure senior debt. Borrowers pay a premium for simplicity and certainty of execution.
Related terms
Senior Debt
The highest-ranking debt in a capital structure, with priority claim on assets and cash flows, typically provided by banks or institutional lenders.
Mezzanine Debt
A hybrid financing instrument ranking between senior debt and equity, typically carrying a higher interest rate and often including equity warrants.
LBO (Leveraged Buyout)
An acquisition financed primarily with debt, where the target's cash flows service the leverage and equity returns are amplified.