Category: Austria

Binder Groesswang has advised Volksbank Niederosterreich Sud, Volksbank Sudburgenland, and Volksbank Wien in connection with the merger of the banking operations of the three banks.  

In the merger, Volksbank Niederosterreich Sud (with banking operations worth approximately EUR 427 million) and Volksbank Sudburgenland (with banking operations worth approximately EUR 253 million) transferred their businesses by way of contribution to Volksbank Wien. The transaction was completed on November 3, 2016.  

As reported previously, the mergers are part of the strategic restructuring of the Austrian Volksbank sector: By 2017, the more than 40 previously existing Volksbank institutions (with balance sheets totaling approximately EUR 30 billion) will be merged into eight regional Volksbank institutions and two specialized banks. Previously, Binder Groesswang advised Volksbank Kufstein-Kitzbuhel, Volksbank Landeck, and Volksbank Tirol Innsbruck-Schwaz in connection with the merger of the banking operations of the three banks to build Volksbank Tirol AG (as reported by CEE Legal Matters on September 14, 2016), and Volksbank Oberes Waldviertel and Volksbank Niederosterreich on the mergers of their operations (as reported by CEE Legal Matters on August 4, 2016).

In this most recent merger, Binder Groesswang advised, in particular, on the corporate structuring and implementation, on banking supervisory related issues, and on competition law, and represented the banks in proceedings with the Companies’ Register, Financial Market Authority, European Central Bank, and Federal Competition Authority.  Binder Groesswang’s core team consisted of Senior Partner Michael Binder, Partner Gottfried Gassner, and Attorneys at Law Claudia Fochtmann and Stefan Frank. The team also included Partners Stephan Heckenthaler, Angelika Pallwein-Prettner, and Christian Wimpissinger, Counsel Isabelle Innerhofer, Attorney at Law Kerstin Pokorny, Associates Mona Holzgruber, Felix Kirkovits, Stefanie Ziegler, Sabine Apfl, and Maja Petrovic. 

Image Source: volksbank.li

Brandl & Talos has advised APEX Ventures on the foundation of a new venture capital fund that provides technology companies in their early stages with growth capital.

According to Brandl & Talos, the APEX Ventures fund will pay particular attention to the proactive development of young companies that need support, especially in their early stages, to capitalize on their potential for global expansion. The venture capital fund is arranged as a European Venture Capital Fund in accordance with the EuVECA-regulation and will be mainly available to investors in Austria, Germany, and the UK.

Brandl & Talos reports that “the collected capital is intended to be invested primarily in innovating start-ups that have new core technologies in selected growth sectors. APEX Ventures plans to invest in the early stages of a company as well as provide sufficient capital for necessary follow-up financing. The persons behind the concept of APEX Ventures are: (i) Christoph Kanneberger, long-standing executive director of J.P. Morgan and managing director of the Powerserv Group; (ii) Stefan Haubner, former partner at VAVE EuVECA Invest; and (iii) Andreas Riegler, a long-standing senior executive of Sony and managing partner at IMAGINE Ventures. All three founders have been active as angel investors for years and have experience helping a large number of young companies in taking the step towards internationalization and consequently to gaining accelerated growth.”

Brandl & Talos assisted APEX Ventures with the structuring of the new venture capital fund, drafting the relevant contracts, and carrying out the registration process with the Austrian Financial Market Authority. The BTP team was led by Partner Roman Rericha, supported by Markus Arzt, Stephan Strass, and Kerstin Liebl.

“We are proud to have assisted APEX Ventures in connection with the founding and registration of their venture capital fund and wish them well for the now-starting fundraising,” said Roman Rericha. “The creation of a new venture capital fund is an important signal for the Austrian start-up and venture capital scene, particularly as there is still some catching up to do compared to international standards.” 

Schoenherr has announced that Bernd Rajal, a Partner in the firm’s regulatory practice, will be added to the firm’s Equity on February 1, 2017.

Rajal is an accomplished energy and environmental legal expert who is specialized in public law. Rajal advises national and international energy companies in the planning and approval of power plants and infrastructure projects, as well as regarding various aspects of energy law. He recently advised the Belgian grid operator Fluxys in the planned acquisition of a 49% stake in OMV subsidiary Gas Connect Austria.

“In an ever more complex energy market, we are thrilled that Bernd Rajal, one of the leading legal experts in this field, is a part of Schoenherr,” said Schoenherr Managing Partner Christoph Lindinger. “He distinguishes himself through his technical know-how, experience and commitment. As equity partner he will play an important role in the success of our law firm.”

Bernd Rajal completed his legal studies at the University of Vienna. He joined Schoenherr in 2006 and was admitted to the Austrian bar in 2008. 

Herbst Kinsky has advised CVC Capital Partners on all Austrian law aspects of its acquisition of AR Packaging Group AB from Ahlstrom Capital and Accent Equity. The Swedish firm Cederquist was Lead Counsel.

Headquartered in Lund, Sweden, AR Packaging has approximately EUR 560 million (2015) in sales and claims 2,200 employees across 17 factories in 9 countries. The company has performed strongly in recent years, Herbst Kinsky reports, posting a 27% increase in net sales last year.

Herbst Kinsky describes CVC Capital Partners — founded in 1981, and today employing over 420 people throughout Europe, Asia, and the United States — as “one of the world’s leading private equity and investment advisory firms.” CVC has completed over 300 investments in a wide range of industries and countries, and its funds are invested in 50 companies worldwide, employing over 350,000 people and generating combined annual sales of approximately USD 100 billion.

The Herbst Kinsky team was led by Attorneys Christoph Wildmoser, supported by Attorneys Philipp Baubin, Tanja Lang, and Johannes Frank, and Associates Alexander Weber, Carl Walderdorff, Matthaus Metzler, Bianca Moller. 

CMS Vienna has advised Styria-based BioEnergy International AG (BDI) on its intended delisting of its free-float shares from the Frankfurt Stock Exchange, which is expected to follow a take-over offer from its majority shareholder, BDI Beteiligungs GmbH. According to CMS, “this is one of the first delisting proceedings after the new German provisions on delisting came into force at the end of 2015.”

BDI Beteiligungs holds 72.46% of BDI shares. According to CMS, “it intends to make the free float shareholders an offer for their BDI shares. BDI also intends, in consultation with the main shareholder, to carry out a delisting of its shares in due course after the offer documents have been published and will, for this purpose, make an application for the revocation of the listing of its shares from the regulated market of the Frankfurt Stock Exchange.”

The CMS team was led by Partner Martin Zuffer, supported by Attorneys-at-Law Mark Philipp and Katharina Grafenhofer. Zuffer stated, “we are very pleased that we are able to support BDI in this transaction, which is extremely interesting from a legal perspective. Much attention was paid to the topic of delisting in both theory and practice after two parallel decisions by the German Federal Constitutional Court in 2012, and there was a lively discussion about what the requirements are on an application by the issuer for revocation of admission to trading on the regulated market. With its ‘Frosta’ decision in 2013, the German Federal Court of Justice abandoned its case law from 2002 (‘Macrotron’) and decided that a delisting requires neither a resolution by a general shareholders meeting nor is a compensation for the shareholders necessary. The calls arising after this decision for more investor protection showed that a legal provision was becoming increasingly necessary. The German legislators responded to this very quickly and embedded a legal provision for delistings in the German Stock Exchange Act. The transaction at hand is one of the first proceedings under these new legal provisions in Germany and is the very first case where an Austrian issuer is involved. This is why the transaction is of particular interest to us.”

CMS has advised investors Michael Heinritzi and Robert Hubner on their purchase of the hotel Schloss Lebenberg in Kitzbuhel from Bank Austria. Freshfields advised Bank Austria on the deal, which is expected to close near the end of the year. The contract was signed on Friday, October 7, and the purchase price was not disclosed.

CMS Partner Gregor Famira, who led the firm’s team on the deal, stated that, “we are very pleased that we were able to provide our concentrated sector expertise to our clients and are also very happy to be actively taking part in the movement which is currently dominating the market.” 

In addition to Gregor Famira, the CMS team consisted of Partners Sibylle Novak, Attorneys at Law Oliver Werner, Martin Trapichler, and Andreas Goller, and Associate Ulrich Weinstich.

The Freshfields team consisted of Partner Thomas Zottl, Counsel Felix Neuwirther, and Associate Noel Zamani.

Schoenherr has advised the UNIQA Insurance Group AG (“UNIQA”) in what the firm describes as “the largest corporate restructuring within the Austrian insurance industry in 2016.”

UNIQA Group is one of the leading insurance groups in its core markets of Austria and Central and Eastern Europe. With 22,000 employees and exclusive sales partners, UNIQA serves more than 10 million customers across 19 countries.

The restructuring of the insurer was recorded in the commercial register on October 1, 2016.  According to Schoenherr, “the restructuring process was highly complex, involving several [reorganizing] steps intended to streamline UNIQA’s Austrian primary insurance operations. Part of the restructuring process included the merger of three primary insurers operating in Austria into the single entity of UNIQA Oesterreich Versicherungen AG (‘UNIQA Oesterreich’). With this merger, UNIQA Oesterreich will become UNIQA’s sole Austrian primary insurance company. The sales partnership with Raiffeisen Bank in Austria will be maintained by retaining the Raiffeisen Versicherung brand with its specific products and solutions.”

“Schoenherr is pleased to have supported UNIQA in this important reorganization,” commented Partner Roman Perner, who co-led the Schoenherr team along with Partner Peter Feyl. “Owing to our transactional expertise in the insurance sector and our comprehensive knowledge of the UNIQA Group, the merger was completed swiftly within a short time frame.”

In addition to Perner and Feyl, the firm’s team consisted of Attorneys Stefanie Woss and Senior Associate Matthias Pressler.

At least eight Austrian, German, and international firms have played significant roles in advising various parties to the Republic of Austria’s successful buy-back offer of debt instruments issued by Heta Asset Resolution AG (“HETA”).

Schoenherr advised the Republic of Austria on the successful buy-back offer and on its provision of funds for the buy back, made along with the EUR 1.2 billion contribution by the Province of Carinthia. The Frankfurt office of Linklaters advised the Republic of Austria as guarantor of the zero coupon bond of Karntner Ausgleichszahlungs-Fonds (K-AF). The Province of Carinthia, Karntner Landesholding, the Sondervermogen Karnten fund, Karntner Beteiligungsverwaltung, and K-AF were advised as to Austrian law by Hausmaninger Kletter Rechtsanwalte and Abel Rechtsanwalte. Skadden Arps and Hausmaninger Kletter also managed the capital market process on the Carinthian side and the launch of the offers by K-AF. 

The two participating international investment banks were internationally advised by Linklaters and on matters of Austrian law by CMS. In addition, Dorda acted as Austrian Counsel to a large group of HETA creditors in enforcing their claims, while the creditors (banks, insurance companies, asset management firms and public institutions) organized in the so-called “par investor pool” were also advised by a team from Germany’s GORG law firm.

Details of the Deal

According to Schoenherr, on Monday, October 10, 2016, K-AF announced that the necessary majority of HETA creditors had accepted the offer pursuant to § 2a of the Austrian Financial Market Stability Act (FinStaG). The purpose of the offer was the buy-back of senior and subordinated debt instruments with a total nominal amount of EUR 10.80 billion guaranteed by the Province of Carinthia. The offer was created in order to facilitate an organized wind-down of HETA, to prevent a material disruption in the Austrian national economy, to preserve macroeconomic stability and to protect the Austrian national economy.

The offer was accepted by creditors holding 98.71% of all guaranteed HETA debt instruments — 99.55% of creditors of senior HETA debt instruments and 89.42% of creditors of subordinated HETA debt instruments — have accepted the offer. The statutory acceptance thresholds of 25% per class of debt instruments and 66.66% in aggregate have thus been significantly exceeded.  

The acceptance of the offer is the result of the Memorandum of Understanding (“MoU”) concluded on May 18, 2016 between the Republic of Austria, represented by the Austrian Minister of Finance, and HETA creditors. By concluding the MoU, the Republic of Austria managed to get a significant number of HETA creditors to accept the offer prior to its launch. The offer documentation and exchange memorandum published on September 6, 2016 was addressed to all senior and subordinated creditors holding debt instruments issued by HETA and guaranteed by the Province of Carinthia. In relation to senior HETA debt instruments, creditors could, as compensation for tendering their instruments, choose to either participate in a cash offer of 75% or exchange their HETA instruments for a medium-term zero coupon bonds issued by K-AF and guaranteed by the Republic of Austria. 

In relation to subordinated HETA debt instruments, creditors could chose to either participate in a cash offer of 30% or exchange their HETA instruments at an exchange ratio of 2:1 for a medium-term zero coupon bond issued by K-AF and guaranteed by the Republic of Austria or exchange their HETA instruments for a long-term zero coupon assignable loan (Schuldscheindarlehen) from the Republic of Austria. 

Whereas the cash offer remained subject to essentially the same commercial terms as the first offer, dated January 21, 2016, creditors could choose in the second offer to exchange their HETA debt instruments for either debt instruments of K-AF or the Republic of Austria.  

The Firms and Attorneys Who Made it Happen

Schoenherr reports that it “played a leading role in advising the Republic of Austria in connection with both the negotiation and implementation of the MoU.” In particular, the firm reports, it “was responsible for structuring and negotiating the material underlying the transaction and financing agreements,” and that it “led the re-drafting of the offer documentation and exchange memorandum to reflect the new complex transaction structure by splitting the cash offer into a combined cash and exchange offer.”

“The overwhelming acceptance of the buy-back offer is a significant milestone in the coordinated resolution process of HETA,” said Schoenherr Partner Sascha Hodl, who led the firm’s team along with Partners Ursula Rath and Wolfgang Holler. The Schoenherr team also included Counsel Stefan Paulmayer, Attorney Miriam Simsa, and Partners Thomas Kulnigg and Martin Ebner. 

Frankfurt-based Linklaters Partner Peter Waltz led the firm’s team providing advice to the two participating international banks.

The core CMS team was led by Capital Markets Partner Martin Zuffer, who described the transaction — which the firm called the largest capital markets transaction ever in Austria — as “extremely complex, as it had a volume of more than EUR 11 billion in nominal value and involved more than 200 debt instruments.” The CMS team also included Partners Daniela Karollus-Bruner, Sibylle Novak, and Robert Keisler, and Attorney Phillip Mark.

The Dorda team was led by Partners Andreas Zahradnik and Bernhard Muller and included Senior Associates Christoph Hilkesberger and Stephan Steinhofer and Associate Christian Kruger-Scholler. 

The GORG team was headed by Roland Hoffmann-Theinert.

The Hausmaninger Kletter team included Partners Mark Kletter and Manfred Ketzer and Associate Barbara Remp. The Abel Rechtsanwalte team consisted of Partner Norbert Abel and Associate Patrick Gensbichler.

Fellner Wratzfeld & Partner has announced the promotion of Stefan Adametz, Patrick Andrieu and Veronika Seronova to Junior Partner.

“The quality of our performance is based on the successful development of our team,” said Founding Partner Markus Fellner. “This includes taking on board long-serving associates who wish to work with us as attorneys after having successfully passed their exam and being admitted to the Austrian bar association.” Stefan Adametz specializes in litigation and banking and investor law. He is also, the firm reports, an expert on competition law as well as on consumer and internet law including e-commerce. He received his law degree from the University of Vienna, and completed post-graduate programs (in European Economic Law and General Management) at Danube University Krems.

Patrick Andrieu specializes in litigation and contesting of claims for damages raised by or against banks. He studied at the University of Graz.

Veronika Seronova works in FWP’s labor law, banking & finance, and dispute resolution teams. She studied law at the University of Vienna.

With the additions of Adametz, Andrieu, and Seronova, Fellner Wratzfeld & Partner now has 22 partners.

Cerha Hempel Spiegelfeld Hlawati has advised RHI AG on Austrian matters related to its merger with Brazil’s Magnesita Refratarios S.A. (MR) with a view to creating a leading provider of refractory products. The new company will be named RHI Magnesita. Also advising RHI AG were DRUDE, Freshfields Bruckhaus Deringer, and Pinheiro Guimaraes. Clifford Chance advised GP Investments and Rhone Capital, MR’s controlling shareholders, on the deal. 

The management board of RHI reached an agreement with GP Investments and Rhone Capital to acquire a controlling stake of at least 46%, but no more than 50% plus one share, of the total share capital of Magnesita. The purchase price for the 46% stake comprises a cash component of EUR 118 million and 4.6 million new shares to be issued by RHI Magnesita, which will have its registered office in the Netherlands and be listed on the London Stock Exchange. Based on RHI’s volume-weighted average price over the past six months, the 46% stake in Magnesita is valued at EUR 208 million. Magnesita’s entire share capital is currently valued at EUR 451 million. 

The transaction is expected to close in 2017 and is subject, inter alia, to: (i) the approval of the competent competition authorities; (ii) the migration of RHI’s registered office to the Netherlands by means of a cross-border merger; and (iii) the listing of the shares of RHI Magnesita in the premium segment of the Official List on the Main Market of the London Stock Exchange, and it is also conditional upon: (iv) the value of the settlement claims made by any shareholders of RHI wishing to withdraw from the company during the course of the cross-border merger not exceeding EUR 70 million. Both the cross-border merger of RHI and the associated organizational changes to be made within the RHI Group require the approval of RHI’s shareholders’ meeting. Once the corporate restructuring has been completed, RHI’s shares will be delisted from the Vienna Stock Exchange. 

The transaction is being financed by additional debt capital as well as the issuance of 4.6 to 5.0 million RHI Magnesita shares to the controlling shareholders of MR. 

Following completion of the Transaction, RHI Magnesita or a group company will make a public mandatory offer to the remaining BMR shareholders. At the same time, a voluntary takeover offer of EUR 8.19 (cash) will be made for each BMR share. Under these parallel offers, up to 5.4 million new RHI Magnesita shares will be issued, with the total volume of newly issued RHI Magnesita shares possibly rising to 10 million. Depending on the result of the public mandatory offer, the controlling shareholders of MR will be obliged to acquire at least 1.9 million additional RHI Magnesita shares and they will have the possibility of acquiring up to a maximum of 3.4 million additional shares. Thus, their participation in RHI Magnesita would increase to a maximum of 8 million shares. All new RHI Magnesita shares to be issued that are not accepted by the shareholders of MR under the offer may be either sold on the open market or placed with institutional investors. Furthermore, RHI Magnesita may choose to combine its public mandatory offer with a voluntary offer under which it delists MR and/or changes its listing from the “Novo Mercado” (new market) segment to another market segment.

RHI is a global provider of refractory products with its registered office in Austria and, according to its own figures, it generated turnover in 2015 of EUR 1.753 million. MR is a provider of integrated refractory solutions, related services and industrial minerals with its registered office in Brazil. In 2015 it generated turnover of USD 1.013 million. 

All legal aspects of the transaction were overseen and managed for RHI by its legal department — led by Robert Ranftler — and by a team of lawyers from DRUDE, Freshfields Bruckhaus Deringer, Pinheiro Guimaraes, and CHSH. CHSH was responsible for structuring the transaction in compliance with Austrian company, capital markets, and takeover law. The firm’s  team was headed by Partner Albert Birkner and consisted of Partners Volker Glas, Bernhard Kofler-Senoner, and Heinrich Foglar-Deinhardstein, Senior Associates Susanne Molitoris, Christian Aichinger, Sarah Wared, Alexander Babinek, and Michael Mayer, and Associates Maximilian Mayer, Nadine Leitner, Alistair Heschl-Gillespie, and Thomas Meier.

The Clifford Chance team was led by London-based Partner Graham Phillips with support from David Lewis, Nikita Culhane, Jenine Hulsmann and Jennifer Storey in London, and Timothy Cornell and Brian Concklin in Washington.

Editor’s Note: After this article was published Dorda announced that it had served as Austrian counsel to GP Investments and Rhone Capital, the principal owners of Magnesita Refratarios S.A. on the sale of their shares to RHI AG. The Dorda team consisted of Partners Christoph Brogyanyi, Jurgen Kittel, and Paul Doralt.