mezzanine investment & finance definition

Debt given to middle-market companies that is subordinated to other higher-ranking debt. Typically mezzanine financing is used for buyouts, recapitalizations, or acquisitions, and the amount of the debt often ranges from about $5 million to $25 million. Mezzanine debt also may incorporate stock warrants. Mezzanine financing may be used in the venture capital industry to describe a funding for a company that is beyond the startup stage but is not yet ready for an initial public offering.