ABSTRACT
Every company that borrows funds, whether occasionally or regularly, must either repay the debt out of operational cash flows, or obtain new finance to replace the debt at maturity.
Refinancing is a process of obtaining new funds to replace debts that are due (or overdue) for repayment. There are various methods of refinancing, for example:
● renewing a committed bank facility when the facility expires ● obtaining new bank loans to redeem maturing loans ● issuing bonds and using the proceeds to redeem maturing loans ● issuing equity and using the proceeds to repay debt (loans or debt securities, such as
bonds or commercial paper).
