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Allen & Overy’s leveraged finance team advises on three debut high-yield bond issuances

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Baudisch Matthias
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10 July 2020

Allen & Overy’s leveraged finance team has advised on three high-yield bond issuances, all of which having completed since the start of July 2020, with each of the deals involving a debut issuer.

For the first of the deals A&O represented HSBC and UBS as joint global coordinators with a syndicate of joint bookrunners and co-managers in the debut high-yield bond offering by Austrian designer and manufacturer of advanced sensor solutions, ams AG. The deal, which is the first debut high-yield issuance by a corporate issuer in Europe post-Covid-19, comprises two tranches of senior notes (EUR650 million and USD400 million) placed in Europe and the US, and contributes to the financing for ams’ successful takeover of German industrial company Osram. It also marks the first New York law-governed, fully-fledged high-yield transaction for an Austrian business.

A&O also advised a consortium of banks, led by global coordinators HSBC and UBS, on the deal to provide the EUR4.9 billion bridge financing (including a EUR450 million working capital facility) supporting ams’ competitive bid for Osram. The bond closed on 6 July 2020 while the takeover transaction completed on 9 July 2020.

In the second of the deals A&O represented Goldman Sachs, Commerzbank, Credit Suisse, Deutsche Bank and UniCredit in a combined high yield-bond and super senior facilities financing for the takeover of German-listed manufacturer of specialty gearboxes Renk AG by funds advised by Triton. The financing consists of EUR320 million of senior secured notes, a EUR50 million super senior revolving credit facility and a EUR167.5 million super senior letter of credit facility. The bond was priced on 2 July 2020, with closing expected on 13 July 2020.

In the third of the completed deals A&O advised Bité Lietuva, a leading integrated mobile, media, fixed broadband and PayTV provider in the Baltic States, and its indirect majority shareholder Providence Equity in a refinancing transaction. The deal comprised EUR400 million of senior secured notes, EUR250 million of senior secured floating rate notes and a EUR50 million super senior revolving credit facility, with the proceeds of the high-yield offering to be used to repay Bité Lietuva’s existing financial debt and to return capital to the shareholders. The bond was priced on 7 July 2020, with closing expected on 16 July 2020.

The deal marked the first dividend recap transaction in Europe or the US post-Covid-19, with Bité Lietuva becoming the first Eastern European issuer in the European high-yield market since the pandemic struck.

Commenting on the three deals, Matthias Baudisch, an Allen & Overy partner based in London, said: “Being able to price and complete three complex deals such as these while Europe begins its recovery from the Covid-19 crisis is a truly remarkable effort. The work of our integrated high-yield and banking teams in the UK, US and Germany demonstrates the true value Allen & Overy can bring to these unique and often first-of-a kind transactions.”

The cross-practice group working on the ams deal comprised a high-yield team led by partner Matthias Baudisch in London with senior associate Yara Owayyed and associates John Fluharty and Isidora Parga; a banking team led by partner Denise Gibson with senior associates Hannah Gates and Alice Smith, associates Xinni Lim, Chris Watkins and Simba Gonondo; and a team in Germany led by partners Walter Uebelhoer, Hartmut Krause and Heike Weber.

On the Renk deal the high-yield team was led by partners Matthias Baudisch and John Kicken with senior associate Khalid Alyafi and associate Sampada Bannurmath. The banking team, led by partner Denise Gibson, included senior associate Warren Newton and associates Sophie Buchanan-Brown and Julius Greiner. The German team was led by partner Thomas Neubaum.

For the Bité Lietuva deal the high-yield team was led by partners Matthias Baudisch and Marc Plepelits working alongside senior associate Rita Nicole Thomas, associates Angela Ryu, Rachel Hitchins and Nikolas Youngsmith. The banking team was led by partner Neil Sinha with senior associate Nick Hallam and associate Yasmin Joharchi.