Assessment of Financial Benefits of Debt Mezzanine Instruments

Abstract

The paper is dedicated to the methodology for evaluating financial benefits of selected mezzanine capital instruments, which refer to hybrid forms of long-term funding combining the features of debt and equity, particularly to those characterized by a higher debt tendency (so-called debt mezzanine instruments). The authors aimed to review the theoretical background of evaluation of financial benefits of classic financing sources and to propose methodology for assessing financial benefits of debt mezzanine instruments.