On October 28, 2016, CEELM reported that P3, a leading pan-European owner, developer and manager of logistics properties, had announced that it had completed a EUR 1.4 billion long-term refinancing, arranged with a group of leading international financial institutions. We invited Katie Schoultz, the Group General Counsel at P3, to share her thoughts on the deal.
CEELM: What would you describe as the most challenging or frustrating part of the restructuring process, and why?
K.S: Coordinating the new funding lines with the pre-payment of existing ones was particularly difficult. We had to draw down four new facilities with six banks and prepay three existing facilities with seven banks (some the same, some different), while releasing and replacing security, all in five days. The banks are all culturally and operationally very different so it was a real challenge to coordinate it all, but also really interesting to knock everyone’s heads together.
CEELM: What were the circumstances behind the refinancing? Why was it deemed necessary, or advisable?
K.S: P3 is already one of Europe’s largest fully integrated logistics property platforms, but we have ambitious plans for further growth. The refinancing provides us with additional flexibility to support this strategy.
CEELM: Dentons advised P3 on Polish and Romanian aspects, with White & Case advising on Czech and Slovak aspects and Freshfields on separate facilities for Western Europe and Poland. Why did you choose to work with three separate law firms rather than one firm across the region?
K.S: We were working across 13 different countries, which would have been a lot for any single law firm. We felt it was better to work with firms that had specific, relevant experience and local expertise. Since Dentons and White & Case were involved in the original facilities, they knew the assets well in those countries and are in any case strong in those respective jurisdictions. Similarly, Freshfields had worked on the previous Western Europe facility.
CEELM: Which of the facilities was the most challenging to arrange? Why was that?
K.S: They were all very complex and each had its own complications. We were grateful for the market expertise and support from our advisor, Eastdil Secured, and our tireless external legal teams.
CEELM: What was the role of your in-house legal team in the restructuring? What tasks did you delegate to your in-house team and which ones to your external advisors?
K.S: Establishing, organizing and updating the data room required for the banks’ due diligence processes was an in-house task. Ten local law firms also assisted us in pulling together and organizing over 65,000 documents. The in-house team ran the lender Q&A, using the (German based) Architrave smart data room platform. We worked on the negotiation of the loan terms with our external advisors, in particular where the terms impacted on day-to-day business operations, and the ongoing financial reporting and compliance requirements placed on P3. External advisors handled security packages and all the document drafting. Under a range of powers of attorney, I signed 99% of the documents myself, sustaining a signing (but not life-threatening) blistered hand injury in the process!