A significant number of financiers believe that the availability of debt will never return to levels experienced at the height of the boom, according to research by DLA Piper and Hawkpoint.

A significant number of financiers believe that the availability of debt will never return to levels experienced at the height of the boom, according to research by DLA Piper and Hawkpoint.

Almost two-thirds (63 per cent) of respondents from banks and private equity firms say that the syndication market for senior debt will never return to liquidity levels seen in 2007.

Interestingly, of those who think that debt markets will return to 2007 levels, 61 per cent say that this will not occur until after 2013, while 27 per cent think it will occur in 2012.

Philip Butler, partner and head of leveraged finance at DLA Piper, comments: ‘The results confirm that debt liquidity will remain challenging in 2010 both in terms of the number of really active participants and the market terms available.’

The study also shows that vendor price expectations will continue to present problems for dealmakers in 2010. Almost half the respondents (41 per cent) think that vendor price expectations will weaken, but not enough to fall in line with market affordability.

Another 24 per cent believe that vendor pricing will remain the same and only 19 per cent estimate that pricing will drop sufficiently to fall in line with the market.