Adding a new financing layer changes the relationships among existing capital providers. Rajeev Khandelwal’s documented structured-finance experience offers context for that change. Senior debt, junior debt and shareholder funding can all support a business, but their rights must coexist. The intercreditor conversation addresses how payments, security and enforcement decisions are coordinated when several parties depend on the same underlying cash generation.
Clarify ordinary payments
The company needs to understand which obligations can be paid during normal operations and whether restrictions apply when performance weakens. A junior facility may appear affordable while its payment rights are conditional on the senior financing position. Cash forecasts should reflect those conditions. This prevents management from promising a payment schedule to one investor that the wider financing structure does not permit it to follow under foreseeable circumstances.
Examine stressed decisions
If the business encounters difficulty, creditors may have different preferences about timing and recovery. Some may favour an immediate sale; others may benefit from allowing more operating time. The agreed process should explain who can act, when discussions occur and what limitations apply. These provisions matter commercially because uncoordinated action can reduce the value available to all parties even where each creditor is pursuing a rational individual objective.
Include future financing
A business may later require new working capital, replacement equipment or rescue funding. The existing structure should be examined for how additional capital can enter. If every new facility requires a complex renegotiation, the company may struggle to respond quickly. The practical aim is to preserve a controlled route for necessary funding while respecting the protections that existing providers relied on when making their original commitments.
A capital structure is a relationship
Credit Connect’s debt and transaction disciplines connect this issue to Rajeev’s wider advisory landscape. Intercreditor arrangements make the hierarchy of claims operational. They are valuable because financing is not simply a stack of separate cheques. The business needs compatible expectations about payments and decisions, especially when conditions change. Clear coordination can protect operating continuity and make the combined capital more useful than its individual components viewed separately.
