This case addresses the issues related to the choice of funding mechanisms to acquire Radiologix in July 2006. Case, Mark Stolper, CFO of RadNet, as he considers how to raise $ 363 million in funds needed to finance the acquisition. After the completion of the combined firm will be the largest private provider of diagnostic imaging in the United States. When Stolper RadNet joined in 2003, he faced with "too much debt, and not the kind of debt." Its purpose is to finance the purchase in a way that further improves the financial stability and operational flexibility of the company. Given the large size of the funding required, the firm is unlikely to be able to finance the whole deal with the first mortgage or bank debt. His financial advisors differ in their recommendations on how to raise the remaining funds are encouraged to use a second mortgage debt, and other high-yield debt. The purpose of the event is to familiarize the students with the most common types of debt financing, which are used to finance mergers and acquisitions and other corporate transactions. The case provides information about the differences among the first mortgage, second mortgage, and high-yield debt in relation to their price, availability, flexibility agreements, repayment ease, and composition of all investors. Case is designed for use in courses that cover corporate finance, M & A, and debt financing. "Hide
by Susan Chaplinsky, Alex Droznik Source: Darden School of Business 22 pages. Publication Date: August 5, 2011. Prod. #: UV5658-PDF-ENG
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