Clifford Chance has confirmed its role in and elaborated on the recent EUR 1.1 billion restructuring of the Mercator Group, reported on by CEE Legal Matters on June 18, 2014.
According to Clifford Chance, "Mercator's financial restructuring is one of the most extensive, complex and challenging financial restructurings ever seen in the region. The capital structure previously consisted of over 150 predominantly bilateral facilities and finance leases with well over 50 financial creditors. Mercator, together with its financial creditors have taken the major step of moving to consolidated sets of financing terms and common decision making platforms, documented in line with international best practices."
Clifford Chance Partner Loren Richards, who led the firm's team on the deal, spoke about its complexity: "Many regional corporates have historically financed themselves with a large number of bilateral financings. This certainly has merits. However, if co-ordinated discussions are required with creditors, this dynamic can also create strategic and operational headaches at the best of times, let alone in a restructuring context." According to Clifford Chance, "even though macro-economic circumstances remain challenging, this landmark financial restructuring is already being referred to as a defining moment for restructurings (as well as the broader investment landscape) in the region." And Richards added that: "Management and their creditors have achieved something truly great and simultaneously demonstrated the regional market's willingness and ability to address issues and to pursue solutions that adopt international best practices."
The Clifford Chance team was led out of Frankfurt by Richards, assisted by London-based Partner John MacLennan and Frankfurt-based Associate Lauren von Dernberg.