INTERNATIONAL HIGH YIELD - DLA Piper · 06 | International High Yield The joint book-running...

INTERNATIONAL HIGH YIELD

02 | International High Yield

UNMATCHED GLOBAL COVERAGE

As one of the largest law firms in the world, we can execute high yield financings wherever they arise. DLA Piper lawyers have relevant experience providing high yield advice on every permanently inhabited continent*.

DLA Piper’s International High Yield Initiative is integrated across all our practice groups and offices, with seasoned high yield practitioners working with local teams to ensure the deal is being executed according to market standards.

Driven by lawyers with significant high yield transactional experience, our International High Yield Initiative reaches beyond the expected London, New York and Hong Kong market coverage to ensure that current market trends and best practices are shared in every major financial center worldwide.

Our unmatched size and geographic footprint includes offices across the entirety of the United States, which we consider a necessary foundation to a truly global high yield practice.

SUPPORTING OUR CLIENTS THROUGH ALL STAGES

Our up-to-date knowledge of the high yield markets enables us to offer comprehensive support to our clients at all stages of high yield/leveraged finance transactions, starting with early pre-term-sheet planning, through negotiation of terms, drafting of appropriate disclosure, establishment of security, closing, listing and beyond transaction completion.

DLA Piper ‘has its finger on the pulse of what clients want’ Debt Capital Markets – Legal 500 2014

OUR INTERNATIONAL HIGH YIELD INITIATIVE

PRACTICE GROWTH

■ “DLA Piper’s ‘broad, deep and responsive team has growing credibility and quality in London’, and has a solid reputation as issuer’s counsel High Yield” – Legal 500 2014

■ Significant investment in global high yield capacity at the partner and counsel level, contributing deep and relevant experience in the ever-evolving European high yield market

■ Growth in London team complements the already well-established global high yield practice

■ Offering practical high yield covenant, structuring and planning advice to corporate and PE clients

■ New clients – Vodafone and Abengoa – demonstrate existing capacity in European high yield advice, structuring and deal execution

We help clients plan for refinancings, restructurings, dividend recapitalisations and multi-track exits for private equity portfolio companies.

We also recognise that operating a business in compliance with high yield covenants is a new experience for first time issuers, so we provide on-going analysis of corporate actions and myriad interpretive questions throughout the life of the bond, giving management peace of mind that they can execute their business according to plan.

If for any reason a leveraged finance structure needs to be revisited, we have direct experience acting for issuers and managers in all types of liability management, including exchange offers, tender offers, consent solicitations and bondholder meetings.

OUR LISTINGS EXPERTISE

We have completed listings on all major exchanges around the world, including all popular high yield listing venues, such as Luxembourg’s Euro MTF, Ireland’s GEM, Singapore’s SGX-ST, and the NYSE.

COVERAGE OF ALL SECTORS

Our high yield lawyers have advised on high yield transactions in virtually every industry sector in which high yield has been used for funding, from Agro-Industrial Production to Ultra Deepwater Drilling; from Specialty Paper to Fisheries.

* When Antarctic high yield needs to be done, we’ll be there too.

www.dlapiper.com | 03

CASE STUDY

In September 2014, DLA Piper advised Abengoa Greenfield S.A, a subsidiary of Abengoa, on the issuance of the European high yield market’s first green bonds. The deal comprised euro and dollar-denominated five-year tranches of €265 million and US$300 million respectively.

The green bond and related guarantees were offered to traditional high yield investors as well as dedicated socially responsible investments buyers with a specific mandate or portfolio for buying green bonds. The net proceeds will be used to finance eligible green projects that meet certain environmental, social and governance criteria set by Abengoa and Vigeo, the leading European expert in the assessment of companies and organisations with regard to their practices and performance on environmental, social and governance issues.

Abengoa is an engineering and clean technology company with operations in more than 50 countries worldwide that provides innovative solutions for a diverse range of customers in the energy and environmental sectors.

■ Complex, dual-currency issuance

■ First issuance of high yield “green bonds” in Europe

■ Jointly run by our Madrid and London offices

■ DLA Piper lawyers provided New York, US federal, Spanish, English and Netherlands law advice

ACQUISITION FINANCE

We regularly advise senior lenders, mezzanine lenders, equity investors, investment funds and corporates on all aspects of syndicated and bilateral debt financing. In the context of public and private company acquisitions, refinancings, management buy-outs and buy-ins and other institutional buy-outs.

With entrenched relationships with UK banks including Barclays and RBS, DLA Piper is justifiably recognised as ‘a major player in the mid-market’ – Legal 500 2014.

INTEGRATION ACROSS DIVERSE PRACTICE AREAS

High yield offerings can be incredibly complex transactions. DLA Piper is able to cover more types of legal issues in more places than most firms. When structuring high yield transactions and vetting complex disclosure, DLA Piper’s high yield teams are often able to draw upon the expertise of in-firm practitioners in practice areas that might otherwise require separate counsel, such as:

■ Antitrust

■ Employment

■ Environmental

■ Financial regulatory

■ Intellectual property

■ International trade

■ Litigation

■ Local and international tax

■ Regulatory and government affairs

■ Restructuring

■ Technology and media

The effective combination of practice skills and geographic reach is essential in an increasingly complex and global economic environment. Our ability to deliver an efficient integrated service allows us to offer quick and high quality solutions with significant savings for clients in terms of administration, management time and bureaucracy.


REPRESENTATIVE HIGH YIELD TRANSACTIONSDLA Piper delivered legal advice in various capacities on each of the following high yield transactions:

Linc Energy on the Rule 144A/ Regulation S issuance by Linc USA GP and Linc Energy Finance (USA), Inc., of US$125 million aggregate principal amount of 95/8% first lien senior secured notes due 2017

Value: US$125 million

Abengoa Greenfield S.A, a subsidiary of Abengoa, on the private placement of its inaugural green bonds that were issued on 30 September 2014. The deal comprised euro and dollar-denominated five-year tranches of €265 million and US$300 million respectively.


Central European Media Enterprises in its redemption of all outstanding 9.0% Senior Notes due 2017 issued by its wholly owned subsidiary CET 21 spol. s r.o., which redemption was funded from the proceeds of a “Term B” credit facility provided by BNP Paribas and Credit Agricole CIB and guaranteed by the company’s largest shareholder, Time Warner Inc.

Value: €240 million (plus US$261 million financing commitment)

DLA Piper advised the issuer in connection with the Rule 144A/Regulation S issuance by Abengoa Finance, S.A.U. of €500,000,000, 6%, senior notes due 2021

Value: €250 million

Matalan as to matters of English law in connection with its issuance of £342,000,000 67/8% First Lien Secured Notes due 2019 and £150,000,000 87/8% Secured Lien Secured Notes due 2020 and repurchase by way of tender offer of its existing senior secured notes

Value: £492 million

PRIVATE EQUITY CLIENTS

Two well-known PE firms with respect to high yield bond and revolving credit facility matters in connection with the acquisition of a high yield bond issuer

DLA Piper’s high yield team has advised Vodafone with respect to six series of “orphan SPV” high yield notes and a senior secured credit facility in connection with its approximately €7.2 billion acquisition of Grupo Corporativo ONO

Hunt Companies on the private placement of its 9.625% Senior Secured Notes due 2021and its US$35 million revolving credit facility

Value: US$560 million (total)

UKRAINIAN OBLIGOR

Ukrainian Obligor in its exchange offer and “amend to extend” consent solicitations and bondholder meetings settled in January, 2014

Central European Media Enterprises in respect of a series of corporate finance transactions including the issuance of US$400 million of senior secured notes and warrants to purchase 84,000,000 shares of Class A Common Stock and the redemption of €273 million of senior notes



The issuer/borrower on its refinancing, comprising €200 million secured loans, €250 million secured high yield bonds, and €250 million convertible bonds. The re-financing involved 11 DLA Piper offices coordinating among 19 jurisdictions

Value: €700 million (total)

Appvion, Inc., in its Rule 144A offering of 9.0% Second Lien Senior Secured Notes due 2020


HEALTHCARE SECTOR ISSUER

A healthcare sector issuer in relation to its issuance of NOK1,000,000,000 of senior secured notes due 2018, supported by an extensive security package and filed for listing on the Stock Exchange in Norway

Value: NOK1 billion

SNF Floerger on the refinancing by its holding company, S.P.C.M. SA., including the issuance of US$250 million of new high yield notes and a new US$250 million senior revolving facility agreement


DriveTime Automotive Group in two separate private offerings of 12.625% Senior Secured Notes due 2017, as well as the subsequent exchange offers for publicly registered notes


Rolta India Limited and the issuer, Rolta, LLC, on the first high yield bond of its kind from India in Rolta’s Rule 144A/Reg S issuance of US$200 million 10.76% Senior Notes due 2018


Austria and Ukraine advised UkrLandFarming on two issuances (Rule 144A/Reg S, US$150 million; Reg S only, US$75 million), of 10.875% notes due 2018


Empire Today, LLC in its Rule 144A/Reg S offering of 11.375% senior secured notes due 2017


Matalan Finance Limited as to English law on its separate Rule 144A/Reg S issuances of £225 million 9 5/8% Senior Notes due 2017, and £250 million 8 7/8% Senior Secured Notes due 2016

Value: £475 million (total)

Sunstate Equipment Co., LLC and Sunstate Equipment Co., Inc. in their joint Rule 144A/Reg S offering of 12% second priority senior secured notes due 2016


Rolta Americas, LLC with respect to a US$300 million follow-on offering


MAJOR EUROPEAN FOOD COMPANY

Major European Food Company with respect to covenant analysis of complex corporate restructuring and specific corporate actions under its existing high yield bonds


The joint book-running managers in the Rule 144A/Reg S offerings of 10.5% Senior Secured Notes due 2019 issued by Advanced Lighting Technologies, Inc.


Vertellus Specialties Inc. in its Rule 144A/Reg S offering of 9.375% senior secured notes due 2015 and entry into a new US$85 million senior secured ABL facility


The wholly owned finance subsidiaries of MagnaChip Semiconductor Corporation on their Rule 144A/Reg S offering of 10.5% Senior Notes due 2018


The book running initial purchasers in the Rule 144A and Regulation S offering of the13% senior secured notes of American Apparel, Inc


The issuer in a Rule144A/Reg S offering of high yield project bonds to finance an expansion of the Port of Paita in Northern Peru. This was the first port-related high yield project bond financing in Latin America


Mobile Mini, Inc., in its Rule 144A/Reg S offering of 7.875% senior notes due 2020


Laureate Education, Inc. in two Rule 144A/Regulation S offerings of its 9.250% senior notes due 2019, along with cash tender offers to purchase existing PIK toggle notes

Value: US$1.4 billion (total new issuance)

A DRUG DELIVERY/MEDICAL DEVICE MANUFACTURER

A drug delivery/medical device manufacturer in its private placement of high yield senior notes

Value: Approx. US$170 million

The issuer in its Rule 144A/Reg S issuance of senior notes due 2016

Value: €104 million (total)

Erickson Air-Crane Incorporated in its Rule 144A Regulation S offering of 8.25% Second Priority Senior Secured Notes due 2020, along with a new five-year revolving credit facility


The Ryland Group, Inc. (NYSE: RYL) in its offering of 5.375% Senior Notes due 2022


A SHIPPING COMPANY

A non domestic shipping sector company in its issuance of senior unsecured bonds due 2018 in the Norwegian bond market, and listing of the bonds on the Nordic Alternative Bond Market

Value: NOK900 million


ROLTA INDIA LIMITED

DLA Piper advised Rolta India Limited on the first successful Rule 144A/Regulation S high yield bond offering from India.

Rolta India, a technology company with operations in 40 locations around the world, priced US$200 million of 10.75% Senior Notes in the international markets, followed by listing on the Singapore Exchange Securities Trading Ltd. (SGX-ST).

DLA Piper implemented a complex security structure on the deal, with the bonds being issued by one of Rolta’s US subsidiaries, Rolta LLC, and with guarantees provided by subsidiaries in the United States, UK and UAE in addition to the Indian parent company.

LINC ENERGY

DLA Piper represented Linc Energy as advisor on an offering of US$125 million 9.625% due-2017 first-lien Senior Secured Notes. Linc’s wholly owned subsidiaries Linc USA GP and Linc Energy Finance (USA) issued the notes.

The group’s US subsidiaries are engaged in the production, development, exploitation and acquisition of crude oil- and gas-producing properties in the US.

The issue was part of the issuers’ debt restructuring, and the transaction involved a pay-down of first lien debt and the replacement of first lien credit facilities with the notes. Security comprised first priority liens on the issuers’ US-based oil and gas assets. In addition to the refinancing Linc intended to use the proceeds for a Gulf Coast drilling program focused on new well targets and low-cost recompletions to increase production and cash flows.

CENTRAL EUROPEAN MEDIA ENTERPRISES

DLA Piper advised Central European Media Enterprises in its redemption of all outstanding 9.0% Senior Notes due 2017 issued by its wholly owned subsidiary CET 21 spol. s r.o., which redemption was funded from the proceeds of a “Term B” credit facility provided by BNP Paribas and Credit Agricole CIB and guaranteed by the company’s largest shareholder, Time Warner Inc. (Time Warner). DLA Piper also advised Central European Media Enterprises with respect to a commitment from Time Warner to refinance the Company’s 5.0% Senior Secured Notes due 2015. This project was an essential move for the client because it reduced overall expense and addressed looming high yield maturities.

NH HOTELES

DLA Piper advised on the €700 million refinancing of NH Hoteles, one of the largest hotel chains in Europe, operating almost 400 hotels with around 60,000 rooms in 26 countries across Europe, America and Africa.

The transaction included €200 million of credit facilities, €250 million in high yield bonds and €250 million in convertible bonds. In acting for the lenders on the credit facilities and creation of the security package for the high yield bonds, the Finance & Projects team in the firm’s Madrid office worked closely with DLA Piper offices in Belgium, the Netherlands, Germany, Austria, Mexico, Poland, Czech Republic, Romania, Venezuela and France, and with relationship firms in Argentina, Luxembourg, Portugal, Switzerland, Uruguay, Chile, Colombia and the Dominican Republic.

KEY DATA

Client: Rolta India Limited

Amount: US$200 million

Indian parent + US, UK and UAE guarantors

KEY DATA

Client: Linc Energy Ltd

Amount: US$125 million

Dual US issuers – 4 DLA Piper offices

KEY DATA Client: Central European Media Enterprises

Amount: €240 million (plus US$261 million financing commitment)

Bond to loan take-out and forward commitment

KEY DATA Client: NH Hoteles

Amount: €700 million

3 instruments – 11 DLA Piper offices – 19 jurisdictions


FLEXIBLE APPROACHES TO HIGH YIELD

FIXED FEE PRICING

The high yield market is in need of predictable pricing from legal service providers. Coordinated transaction management from our International High Yield Initiative, coupled with our geographic, practice area and sector scope, allows us to price cost-effectively.

We can offer genuine fixed fee pricing when certainty is paramount.

UNITRANCHE

DLA Piper is a leading advisor for unitranche financings, having helped unitranche capital providers to develop their base lending documentation.

A recent quote from Chambers and Partners identified one of the partners in our practice as “the fount of all knowledge for non-bank lending at the moment.”

SPECIAL STRUCTURES

Lawyers at DLA Piper have experience drawing from other areas of structured and specialty finance to resolve issues in the high yield arena, such as:

■ Synthetic guarantees

■ Ring-fencing collateral pools

■ “Orphan” SPV structures

■ Loan participation notes

PROJECT FINANCE

Our lawyers have adapted high yield approaches to project finance and asset finance.

For example, both as initial financing, or refinancing to replace or supplement existing project finance facilities, high yield bonds have been used to finance ports, airports, aircraft purchases and ultradeepwater drill ships.

BESPOKE SOLUTIONS

Whether creatively approaching work-outs and out-of-court restructurings, pre-emptively solving change-of-control issues, navigating complex intercreditor questions or addressing “never been done” scenarios, DLA Piper attorneys will bring years of high yield experience to the process. We customise so-called “private high yield” solutions for our clients.

MORE THAN PLAIN VANILLA HIGH YIELD ADVICEClients need flexible and durable approaches to leveraged finance, perhaps now more than ever. Our high yield lawyers have experience with every type of “regular” high yield bond offering and bank/bond structure, but have also worked to adapt high yield bond approaches to bespoke products and to introduce high yield concepts to new markets.

NORWEGIAN HIGH YIELD

As the only multinational law firm with an office in Norway, we are uniquely positioned to introduce our clients to the Norwegian high yield market, where sub-investment grade issuers may access small to mid-market financing levels with lower legal costs due to standardised documentation and practices.

Law Firm Of The Year – 2014 Legal Business Awards

LEGAL BUSINESS IN-HOUSE SURVEY

DLA Piper was in Top 5 for each of

■ “Best Firms: Value for Money”

■ “Best Firms: All Categories”

■ “Best Firms: Pragmatic Commercial Advice and Strong Service Delivery”

Most Innovative Firm in Finance Law – Financial Times’ Innovative Lawyers Awards 2012

Most Innovative Law Firm in Client Service – Financial Times’ Innovative Lawyer Awards 2013


KEY CONTACTS

EUROPE

UK

Tony Lopez Partner T +44 20 7153 7208 [email protected]

Sabrina Fox Counsel T +44 20 7796 6729 [email protected]

Martin Bartlam Partner T +44 20 7796 6309

[email protected]

Alexander Griffith Partner T +44 20 7796 6158 [email protected]

George Barboutis Partner T +44 20 7796 6754 [email protected]

Matthew Christmas Partner T +44 161 235 4033 [email protected]

Smridhi Gulati Senior Associate T +44 20 7153 7869 [email protected]

Iryna Nagayets Senior Associate T +44 20 7796 6759 [email protected]

AUSTRIA

Christian Temmel Partner T +43 1 531 78 1505 [email protected]

FRANCE

Maud Manon Partner, Paris T +33 1 40 15 66 39

[email protected]

ITALY

Ugo Calo Partner T +39 02 80 618 533 [email protected]

NORWAY

Camilla Wollan Partner T +47 2413 1659 [email protected]

SPAIN

Ignacio Gomez-Sancha Partner T +34 91 788 7344 [email protected]

THE NETHERLANDS

Gerard Kneppers Partner T +31 20 541 9811 [email protected]


UKRAINE

Oleksandr Kurdydyk Partner T +380 44 490 9570 [email protected]

AMERICAS

NEW YORK

Jamie Knox Partner T +1 212 335 4992 [email protected]

Christopher C. Paci Partner T +1 212 335 4970 [email protected]

Jack Kantrowitz Partner T +1 212 335 4845 [email protected]

Roger Meltzer Partner T +1 212 335 4550 [email protected]

Shmuel Klahr Partner T +1 212 335 4721 [email protected]

Jeffrey Susskind Associate T +1 212 335 4717 [email protected]

BALTIMORE

Jason Harmon Partner T +1 410 580 4170 [email protected]

LOS ANGELES

Ann Lawrence Partner T +1 213 330 7755 [email protected]

PHOENIX

Steve Pidgeon Partner T +1 480 606 5124 [email protected]

Greg Hall Partner T +1 480 606 5128 [email protected]

David Lewis Partner T +1 480 606 5126 [email protected]

SILICON VALLEY

Curtis Mo Partner T +1 650 833 2015 [email protected]

BRAZIL

Jeffrey Susskind Associate T +1 212 335 4717 [email protected]

mailto:[email protected]








AUSTRALIABrisbaneCanberraMelbournePerthSydney

AUSTRIAVienna

BAHRAINManama

BELGIUMAntwerpBrussels

BRAZILSão Paulo

CHINABeijingHong KongShanghai

CZECH REPUBLICPrague

FRANCEParis

GEORGIATbilisi

GERMANYBerlinCologneFrankfurtHamburgMunich

HUNGARYBudapest

ITALYMilanRome

JAPANTokyo

KUWAITKuwait City

LUXEMBOURGLuxembourg

MEXICOMexico City

NETHERLANDSAmsterdam

NORWAYOslo

OMANMuscat

POLANDWarsaw

QATARDoha

ROMANIABucharest

RUSSIAMoscowSt. Petersburg

SAUDI ARABIARiyadh

SINGAPORESingapore

DLA PIPER RELATIONSHIP FIRMS

SLOVAK REPUBLICBratislava

SOUTH KOREASeoul

SPAINMadrid

THAILANDBangkok

UKRAINEKyiv

UNITED ARAB EMIRATESAbu DhabiDubai

UNITED KINGDOMBirminghamEdinburghLeedsLiverpoolLondonManchesterShef�eld

UNITED STATESAlbanyAtlantaAtlantic CityAustinBaltimoreBostonChicagoDallasHoustonLos AngelesLa JollaMiamiMinneapolis

New YorkNorthern VirginiaPhiladelphiaPhoenixRaleighSacramentoSan DiegoSan FranciscoSeattleShort HillsSilicon ValleyTampaWashington, DCWilmington

ETHIOPIAAddis Ababa

GHANAAccra

INDONESIAJakarta

IRELANDDublin

KENYANairobi

MAURITIUSPort Louis

MOZAMBIQUEMaputo

ALGERIAAlgiersBOSNIA-HERZEGOVINASarajevoBOTSWANAGaboroneBURUNDIBujumburaCROATIAZagrebDENMARKCopenhagenEGYPTCairo

NAMIBIAWindhoek

NEW ZEALANDAuckland Wellington

PORTUGALLisbon

RWANDAKigali

SOUTH AFRICACape TownJohannesburg

SWEDENStockholm

TANZANIADar es SalaamMwanza

TURKEYAnkaraIstanbul

UGANDAKampala

VENEZUELACaracas

ZAMBIALusaka

ASIA/PAC

AUSTRALIA

Neil Campbell Senior Foreign Legal Associate T +61 2 9286 8297 [email protected]

Bill Glover Partner T +61 3 9274 5255 [email protected]

Hugo Thistlewood Partner T +61 2 9286 8474 [email protected]

HONG KONG

Stephen Peepels Partner T +852 2103 0594 [email protected]

Paul Lee Partner T +852 2103 0886 [email protected]

DLA Piper is a global law firm operating through various separate and distinct legal entities. Further details of these entities can be found at

www.dlapiper.com. Note past results are not guarantees of future results. Each matter is individual and will be decided on its own facts. Tony Angel,

3 Noble Street, London, EC2V 7EE, United Kingdom, T: +44 (0)207 153 7500. Attorney Advertising.

Copyright © 2015 DLA Piper. All rights reserved. | FEB15 | 2795870

www.dlapiper.com

INTERNATIONAL HIGH YIELD - DLA Piper · 06 | International High Yield The joint book-running...

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Transcript of INTERNATIONAL HIGH YIELD - DLA Piper · 06 | International High Yield The joint book-running...