Experience

US$240mn Debt and Corporate Restructuring and Exit of Portfolio Investment

Our Insolvency and Restructuring Practice and our M&A Practice advised a bank on the management of a distressed US$240mn investment into a Hong Kong based joint venture. The investment comprised a senior secured syndicated loan, a convertible subordinated loan and an equity stake. [check] The security package comprised a charge over a long-term leasehold interest in the operating premises, a fixed charge over equipment, a floating charge over the entire business and undertaking as well as an assignment of receivables.

We represented the client bank over a multi-year period on the full range of legal issues including:

  • advising on the rights of the client bank under the joint venture shareholders agreement and representing the bank in a subsequent buy-out of the joint-venture partner

  • advising on possible options to restructure the debt including a voluntary workout and a scheme of arrangement

  • assisting the client bank with negotiations for the purposes of a debt restructuring and preparaing information circulars and court documents for a scheme of arrangement

  • advising the client bank on possible options to exit the investment including a liquidation, a hive-off of assets for sale as an ongoing concern and a share sale, and assisting the bank with negotiations for the sale of the business

  • advising the client bank on options to forestall a winding-up order, including the possibility of using a provisional liquidation to effect a statutory moratorium

  • advising the client bank on the duties of its nominated directors to the board of directors of the portfolio company including as regards tradingin the insolvency zone and conflicts of interest

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