Category: Czech Republic

Dentons has advised a syndicate of banks including joint bookrunners Citi, Deutsche Bank, Erste Group, and SMBC Nikko and co-lead manager Raiffeisen Bank International on the EUR 600 million debut sustainability-linked bond issuance by CEZ. Kinstellar and, reportedly, Linklaters advised CEZ on the issuance.

According to Dentons, the “2.375% bonds are due in 2027. This was the first-ever euro sustainability-linked bond issuance by an investment-grade utility company in central and eastern Europe. Dentons acted as English law and Czech law counsel.”

The CEZ Group operates in western, central, and south-eastern Europe and focuses on the generation, distribution, trading, and sale of electricity and heat; trading and sale of natural gas; provision of energy services from the new energy sector; and coal mining.

According to Dentons, “the use of proceeds of the bond issue is general corporate purposes but CEZ undertakes that proceeds will not be used for coal power generation projects. The key performance indicator for the bond is CEZ reducing greenhouse gas intensity by 31% at the end of 2025 compared with 2019. The bonds were well received by the market, with books exceeding EUR 3.1 billion from over 200 individual orders.”

Dentons’ team included Prague-based Partners Jiri Tomola and Petr Zakoucky and Senior Associates Jan Hrivnak and Ivo Hartmann, with a further team in London.

Kinstellar’s team included Partners Kamil Blazek and Kvetoslav Krejci, Counsel Martina Brezinova, Managing Associate Michal Forytek, and Associate Jakub Stastny.

Former Deloitte Partner Ivan Telecky has rejoined Allen & Overy in Prague as Counsel.

According to the firm, Telecky will help Allen & Overy to further develop its Real Estate and Energy practices. “Ivan specializes in real estate and represents clients in the implementation of their real-estate and energy projects, including projects in the field of nuclear energy.”

Prior to rejoining Allen & Overy, Telecky spent almost eight years as a Partner with Deloitte in the Czech Republic. Prior to that, he spent three years with Wilsons as a Partner and, earlier still, almost eleven years with Allen & Overy. 

“We are very pleased that Ivan is returning to A&O to further support our rapidly growing Real Estate Practice,” commented Prague office Managing Partner Prokop Verner.

“Ivan’s return to Allen & Overy will significantly strengthen our team, including in the area of real estate financing,” added Prague’s Banking & Finance Head, Partner Petr Vybiral.

On February 25, 2022, CEE Legal Matters reported that Clifford Chance had advised Commerz Real on its sale of Charles Square Center to a closed-end European real estate fund represented by KGAL Investment Management. CEE In-House Matters spoke with Dirk Schilo, Senior Legal Counsel at Commerz Real to learn more about the deal.

CEEIHM: To begin, tell our readers a few words about Commerz Real.

Schilo: Commerz Real is a subsidiary of Commerzbank AG with 50 years of market experience and approximately EUR 35 billion in assets under management. We combine comprehensive know-how in asset management and broad-based structuring expertise to deliver our signature range of services of fund products focused on tangibles and bespoke financing solutions. Our fund spectrum includes the open-ended real estate fund Hausinvest, Germany’s first retail impact fund for real assets Klimavest, institutional investment products as well as entrepreneurial participation in real estate, aircraft, regenerative energy, and ships. In our role as the leasing company of Commerzbank Group, we also offer tailored equipment leasing concepts.

CEEIHM: Clifford Chance recently advised you on the sale of the Charles Square Center to a closed-end European real estate fund. What do you believe made the target particularly attractive?

Schilo: The Charles Square Center offers the opportunity to participate in Prague’s dynamic economic development. The inner-city office and commercial complex with a total of almost 20,000 square meters of lettable space has a number of international, well-known tenants, including Cisco Systems, Dior, Raiffeisenbank, and Commerzbank. In addition to the central location on Charles Square with optimal transport connections, the property offers further advantages such as the spacious and light-flooded floor areas, sufficient parking spaces, and a broad user mix including gastronomy, fitness, and shopping.

CEEIHM: What was the most complex aspect of this transaction?

Schilo: The share deal involved a multitude of legal and commercial aspects raised in the due diligence and in the negotiations phases. Cutting through that complexity was challenging but worked out well. One particularly demanding issue was the tailoring of purchase price adjustments depending on future occupancy, indexation, and reletting costs.

CEEIHM: How was the legal work split between your in-house team and your external advisors?

Schilo: First of all, we shared our tasks along with the laws involved, geography, and knowledge. Clifford Chance took care of all aspects of Czech law including drafting, liaising with Czech lawyers, administrations, courts, etc. as well as hosting the signing and closing in Prague. The German in-house counsel dealt with German legal aspects and formalities gave input stemming from the history of the asset as well as from internal conditions and took the client role when it came to legal decisions.

Regarding the process of getting the negotiated commercial content into the documentation, I would not speak of a split of work, but of close cooperation between Clifford Chance, Commerz Real´s transaction manager Frank Haubner, and myself working hand in hand in a constant process of shaping and reshaping.

CEEIHM: Lastly, why did you choose Clifford Chance to advise you on this deal?

Schilo: We invited CC to pitch as they are well-known in the market. Aneta Disman and Emil Holub convinced us with already thinking on the merits during the pitching phase and gave the impression of being very competent whilst having a commercial insight into the market and a flexible, responsive, and easy working approach – which turned out to be the case, indeed!

Originally reported by CEE In-House Matters.

Havel & Partners has advised Lighthouse Ventures on its CZK 400 million sale of Pekat Vision to Datalogic. White & Case advised the buyer.

Pekat is a Czech company developing proprietary machine and algorithm learning for application in supply chains and industrial automation.

The Lighthouse Ventures is an investment fund, focusing on technology companies. The fund provides start-ups with funding, a network of contacts, and an international team of partners, mentors, and advisors.

Euronext Star subsidiary Datalogic is a Milan Stock Market-listed company, specializing in designing and production of barcode readers, mobile computers, sensors for detection, measurement, and safety, radio frequency identification vision, and laser marking systems. 

“Pekat Vision is the first company we have invested in, and the first company we have sold,” Lighthouse Ventures Managing Partner Michal Zalesak commented. “We are very happy that the investors who trusted us have received their investment back with an eightfold appreciation compared to the initial value, in less than three years.”

The Havel & Partners team was led by Partner Vaclav Audes and Senior Associate Juraj Petro.

The White & Case team included Prague-based Local Partner Marianna Galusova and Associate Petra Zunova, and Milan-based Partner Leonardo Graffi.

Havel & Partners advised the Czech owners on their sale of Sensa Food to Mocca Holding. VGD Legal advised Mocca on the transaction and an acquisition financing deal with Raiffeisenbank.

Chocoland company Sensa Food specializes in the production, import, and distribution of branded confectionery and food.

The Havel & Partners team included Partner Jan Koval, Senior Associate Veronika Filipova, Junior Associate Johana Nemeckova, and paralegal Filip Pavlik.

The VGD Legal team included Partner Robert Musil, Associate Dominika Dolezalova, and Paralegal Darek Dolezal.

Denisa Novakova has been appointed as Head of Real Estate in the Prague team of CEE Attorneys.

Novakova has been with the team since 2019 when she joined as a Senior Associate. She was appointed to Managing Associate in July 2020. Prior to her current team, she worked for Bernard Legal as a Senior Associate, in 2019. Earlier still, she was an Attorney at Law with PRK Partners. She also worked as a Junior Associate with Wilsons, Pokorny Wagner & Partners, and Vilimkova Dudak & Partners.

PRK Partners, working with AllBright Law Offices, has advised Shaangu Power (Luxembourg) on Czech law-related aspects of its acquisition of Ekol.

Shaangu Power (Luxembourg) is a member of the Shanghai Stock Exchange-listed Shaangu Group. The Shaangu Group is a state-owned Chinese industrial group focusing on energy projects.

Ekol is a Czech heat and power engineering, procurement, and construction provider and manufacturer of steam and gas turbines and boilers.

The current primary focus of the Czech government is to help Ukrainian refugees and deal with the various issues surrounding sanctions against Russia, according to Kinstellar Partner Jan Juroska.

“The current Czech government only recently assumed office,” explains Juroska. “Their primary focus at the moment is to address the Ukrainian refugees situation as well as implementing sanctions against Russia.” In terms of refugees, he says, that the government is in the process of adopting and changing the relevant regulatory framework, in order to provide refugees with the necessary protections, access to medical care, education, social insurance benefits, and the right to enter the employment market. He adds that, while “no major reforms are expected this year, there is some new legislation to be approved such as new legislation governing whistleblowing as well as legislation to regulate crowdfunding. In addition, certain EU directives need to be transposed into Czech law, but obviously, right now all eyes are on Ukraine.”

Juroska points out that the Czech Bar Association is actively issuing guidelines to help Czech lawyers volunteer to support Ukrainian refugees with paperwork and administrative matters. To that end, he adds, various state-run and non-state-run websites have recently been translated into Ukrainian so as to offer easy access to those in need. “The overall atmosphere in the country is highly sympathetic and supportive towards the tens of thousands of refugees fleeing from the east,” says Juroska. The country, he adds, has “truly opened up [its] hearts, homes, and wallets in every respect.”

In terms of what the current conflict means for the business environment, Juroska says that these are undoubtedly unprecedented and very challenging times. “During the past few weeks, a number of cross-border M&A deals have been put on hold. Local deals, on the other hand, are still going forward. But it remains to be seen how the conflict will affect the market and, in particular, how banks will price in the current uncertainties and associated risks and whether they will even continue to finance certain projects.”

Juroska predicts that the overall economy will slow down as a result of supply chain issues, increased commodity prices, and high inflation (all three are already an issue post-COVID-19). “Some of our commercial clients have already suspended or reduced production as imports from Ukraine have been disrupted, or as a result of significant increases to commodity prices.” 

JSK has advised Genesis Growth Equity Fund I investment fund on the acquisition of a majority stake in HC electronics s.r.o. The sellers were advised by PPS Advokati.

According to JSK, “Genesis Growth Equity Fund I specializes in fast-growing small and medium-sized enterprises in the Czech Republic, Slovakia, and neighboring countries. It assists the companies in its portfolio to efficiently use the capital provided to accelerate growth, increase operational efficiency or improve competitiveness.”

HC Electronics is a Czech technology company specializing in manufacturing services in electronics, especially PCB mounting and related activities.

JSK’s team included Partner Tomas Dolezil, Lawyers Luca Regecova and Daniel Pospisil, and Trainees Jan Koprnicky and Filip Kvapil.

PPS Advokati’s team included Partners Milan Chmelik and Ervin Perthen.

Havel & Partners has advised lead investor Euroventures on a EUR 6.14 million series A investment round into Daytrip. Novalia reportedly advised Daytrip.

The Euroventures-led investment round included J&T Ventures, Nation 1 VC, and Pale Fire Capital.

“Daytrip plans to use the investment for its further growth,” Havel & Partners informed. “The company has been operating since 2015. It offers tourists in destinations around the world an alternative to conventional modes of transport, and more than 300,000 people have already used its services.”

Daytrip is a global platform offering tourists private transport with local drivers in 85 countries.

Euroventures is a Budapest-based venture capital firm investing in companies in the Central and Eastern European region.

The Havel & Partners team included Partner Vaclav Audes and Associate Josef Bouchal.