Drop-down

Transaction type · also called dropdown; drop-down financing; IP drop-down

A transfer of assets or value away from the obligor group, usually to an unrestricted or non-guarantor subsidiary, which then raises new debt secured on those assets and structurally senior to existing creditors.

Associated with J.Crew (2017)

Discussed at ¶¶ 2.26, 13.1–13.4 of Liability Management Exercises: Law and Practice.