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Bridge Financing

   Also found in: Wikipedia 0.01 sec.
Bridge financing
Interim financing of one sort or another used to solidify a position until more permanent financing is arranged.

Bridge Financing
Financing or credit that an investment bank or venture capital firm extends until long-term financing can be arranged or an obligation is removed. If bridge financing is a loan, interest rates are relatively high, often 12-15%. Some institutions, however, accept payment in the form of equity in the company receiving the financing, often in order to sell to investors later. Bridge financing is used to satisfy working capital needs; for example, if a company is arranging for an IPO or a bond issue in the coming months, but needs capital before then, it may arrange bridge financing. See also: Angel investor.


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Fiat chief executive Sergio Marchionne said a requirement that Fiat provide Opel with emergency funds while the government decides the timing and conditions of bridge financing would expose the Turin-based company to "unnecessary and unwarranted risks".
Included in ABI's $45 billion in debt financing, was $7 billion in bridge financing "for divestitures of non-core assets.
 
 
 
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