New York-based commercial finance and asset management company Churchill Financial completed its acquisition of Churchill Capital's Mezzanine Finance Business last week. Though the merger, which will solidify two business platforms that have long been converging, Churchill Financial hopes to take advantage of increasingly attractive market conditions for mezzanine lending.
While the mezzanine market has remained relatively slow amid a tidal wave of second-lien activity, the investment vehicle could begin to see its own wave cresting, according to President and Chief Executive Ken Kencel, making it a very suitable time for Churchill to enhance its mezzanine lending business. "The mezzanine market has had ebbs and flows in terms of activity. And with the growth in the second-lien market, mezzanine financing has been relatively quiet over the last few years," Kencel said. However, with interest rates edging up a bit, the mezzanine market has increased in activity. "We felt that the timing was good to get more involved directly in the mezzanine business. The market has increased in popularity, and is more active, so we felt that it was important to have a more substantial mezzanine capability and experienced people who have done it for a long time."