Category: Interviews

On March 11, 2020, CEE Legal Matters reported that Kinstellar had advised Austria’s European City Estates – a group of companies owned by the Austrian Humer Private Foundation – on its acquisition of the 22,000-square-meter Rosum office complex in Bratislava from Penta Real Estate, which was advised by Skubla & Partneri.

The Players:

Counsel for European City Estates: Viliam Mysicka, Partner, Kinstellar Slovakia

Counsel for Penta Real Estate: Marian Sulik, Partner, Skubla & Partneri

CEELM: Viliam, let’s start with you. How did you and Kinstellar become involved in this matter?

Viliam: European City Estates is a long-term Kinstellar client in Prague. In 2019, ECE began an expansion initiative in Slovakia. Due to the need for a Slovak law firm, our Prague colleagues introduced me to Dejan Mansfeld-Rupnik, ECE’s managing director.

This referral resulted in us assisting ECE with its acquisition last spring of the Business Centrum Tesla 2 (BCT2) in Kosice from Penta Real Estate.

Rosum was our second project with ECE in Slovakia. Penta initially intended to sell it to another buyer, however, when negotiations collapsed in December 2019, ECE got involved, and we started work shortly before Christmas.

We actually started the due diligence on January 7, 2020 and completed the acquisition (including financial settlement) on February 27, 2020, so the entire transaction took less than eight weeks, making it one of the fastest deals on the Slovak real estate market in recent years.

CEELM: Marian, how about you? How did Skubla & Partneri become involved in this matter?

Marian: We have a long-term relationship with Penta Real Estate and we actually advised them already in the past on several high profile real estate transactions. We have acted for them both on the sell side and the buy side, historically, therefore in our view it was kind of natural for them to approach us in this matter. We were involved from the very beginning, when the client decided to sell the asset and needed legal support.

CEELM: What, exactly, was the initial mandate when you were each retained for this project, at the very beginning?

Viliam: It was full-scope from the very beginning. I believe we had very good cooperation on the Kosice deal, so it was natural that the cooperation resulted in the Rosum deal as well.

Marian: We were basically asked to cover and oversee the whole sale process from the legal point of view. This included assisting with compiling the vendor due diligence data room for the purposes of the buyer’s due diligence report; assisting with the preparation of answers to legal questions; and providing overall support to the project team with respect to questions and needs of a legal character which arose in connection with the transaction. Since this was not our first transaction for Penta, we knew what was expected of us and what are responsibilities were.

CEELM: Who were the members of your teams, and what were their individual responsibilities?

Viliam: I led our team and was the main contact for the client on the Kinstellar side. The team consisted of: Vladimir Policka, Managing Associate, responsible for deal structuring, financing, SPA, and the overall matter management on Kinstellar’ side; and Martin Kosa, Senior Associate, responsible for the due diligence process, financing, and transaction closing, as well as assisting with deal structuring and client management throughout the transaction. The three of us cooperated closely throughout the entire transaction and supported each other as needed.

Of course, the team was supplemented with other colleagues, in particular one of our rising stars, Norbert Stilla, Junior Associate, who assumed the role of main reviewer of the major lease agreements (one of the most important areas of review, considering Rosum is an office building). I would like to use this opportunity thank each and every one of them for their immpecable professionalism, hard work, outstanding knowledge, and diligence.

Marian: I was in charge of negotiating and drafting the SPA and supervising other team members. My colleague, Partner Erika Galgociova, assisted me with the SPA. Associate Michaela Balazova assisted and provided her support during the due diligence phase and Junior Associate Erik Mateasik assisted me with the preparation of ancillary documents and other documents required for closing of the transaction.

CEELM: Please describe the deal in as much detail as possible, including your (and your firms’) roles in helping make it happen.

Viliam: In general, under Slovak law, when there is a change of ownership of real estate, tenants are entitled to terminate their leases. It is therefore customary, if an office builiding is to be acquired, that the deal is structured as a share deal (unless specific circumstances for another approach exist). Thus this deal was structured as a share deal. The target company existed in the form of a joint-stock company (in Slovak: akciova spolocnost). It was therefore expected that the signing and closing would take place simultaneously – preferably by the end of February 2020. Both parties communicated this from the very beginning (it should again be stressed that our due diligence commenced on January 7, 2020, so the end-February was quite a courageous deadline).

Considering the circumstances, the deal structure also depended on (and we were asked to implement mechanisms for) repaying the development bank financing and intragroup financing arrangements provided to the target company.

During the due diligence process, we identified several more-or-less important issues, mainly relating to the construction of the Rosum office building. These were duly discussed with Penta and agreements to remedy the identified flags were finally achieved to the satisfaction of both ECE and Penta.

The transaction documentation was drafted by Penta’s legal counsel (Skubla & Partneri). Our main role consisted of reflecting all issues identified during the due diligence to be covered in the SPA, in particular by R&Ws and/or relevant indemnities provided by Penta as the seller.

My colleagues Vladimir and Martin also assisted ECE with negotiating the financing documentation entered at closing by the target company and communication with the bank’s local counsel.

During the negotiation process we took part in several negotiation meetings with Penta and all its advisors. Given that the same setup on the sell/buy-side (including legal advisors) had already met in the course of the BCT2 acquisition, negotiations on the Rosum acquisition were rather factual, straightforward, and smooth. The same could be said of the signing and closing venue.

Marian: The deal was structured as a share deal, and the fact that the target company was a joint stock company allowed us to structure the deal to allow signing and closing to occur on the same day. We were able to come up with proposals and concessions satisfying both parties which allowed the deal to happen. In particular, we had to consider and implement measures to resolve existing financing issues and existing intragroup financing. There were also several legal topics on which we were able to reach compromise solutions.

CEELM: What’s is the current status of the deal?

Viliam: The deal was signed and closed (including legal and financial settlement) on February 27, 2020, but given the major workload and deadlocks at the relevant state authorities, some post-closing administrative proceedings were only finalized a few days ago.

Marian: The deal was successfully closed and the takeover of the building has occurred.

CEELM: What was the most challenging or frustrating part of the process? Why?

Viliam: Truly, the deal was smooth as we had a good track record with Penta earlier.

Marian: To be honest there were no real frustrating parts. The deal was challenging due to timing and deadlines. We had to make sure that our proposed structure made sense to the buyer so conceptually we had to show the logic behind the structure. But both the buyer and Kinstellar were very reasonable and understood our and client’s demands and reasoning. 

CEELM: Was there any part of the process that was unusually or unexpectedly smooth/easy?

Viliam: Financing provided by the Austrian bank – signing, completion and draw of funds – on the same date as the SPA closing is not very common in Slovakia.

Marian: Actually, I would say that the whole transaction went quite smoothly. Our client was well prepared for the deal and the level of detail and quality of documentation was, in our view, high, which enabled the buyer and buyer’s counsels to proceed quite effectively. 

CEELM: Did the final result match your initial mandate, or did it change/transform somehow from what was initially anticipated?

Viliam: Except for the volume of documents that needed to be reviewed during the due diligence (which was initially expected to be less) and certain adjustments of the deal structure in terms of financing by the Austrian bank, we can confirm that the final result matched our initial mandate.

Marian: As stated in the beginning, this was not our first transaction with the client. Therefore, we knew what kind of work would be expected from us and I believe we delivered what was required. There was no major change in our mandate and in our role.

CEELM: Viliam, what specific individuals at ECE instructed you, and how did you interact with them?

Viliam: From the very beginning, we wre in daily touch with Dejan Mansfeld-Rupnik, ECE’s managing director.

CEELM: Marian, what about you? Which individuals did you work with at Penta?

Marian: We were instructed by Country Managing Director Juraj Nevolnik and Business Development Director Michal Hranai. Of course, taking into account the value, importance, and demanding nature of the deal, we were in frequent – daily – contact with the client. The majority of the communication was done via e-mail and conference calls, but we had weekly update meetings, which usually took place as personal meetings at the client’s premises.

CEELM: How would you describe the working relationship with each other on the deal? Viliam, can you comment on your relationship with Skubla & Partneri?

Viliam: We would like to highlight the approach by Skubla & Partneri and Marian Sulik, who led the deal on their side. They were exactly the counterparty you want to work with: pragmatic, pro-active, cooperative, and straightforward.

Most of the interactions with Skubla & Partneri was through conference calls and e-mails. However, we participated at several negotiation meetings together with Penta and Skubla & Partneri. These meetings were rather short (not exceeding three hours), and all of them were rather friendly in spirit.

CEELM: Marian, what was your relationship with Kinstellar like?

Marian:  I would describe the relationship as very good. We have worked as counterparties on several transactions in the past and in my view there is a mutual respect between our firms (on a professional as well as personal level). In this particular deal, most of the communication was done over phone and via e-mail, even though the communication was quite intense. Personal meetings were quite limited; we basically had an introducory kick-off meeting, a red flag meeting where we discussed and agreed on identified issues, and then a final wrap-up meeting, where we agreed on final outstanding items. We also met at the signing date in our premises, where we went through all the documents jointly (we were in charge of preparation of the documentation for execution). The personal meetings were quite effective and we were able to resolve and agree on raised issues within couple of hours. The overall negotiation process was rather effective as well (we finalized the negotiations in a couple of weeks, even though the communication was intense and hectic).

CEELM: Finally, how would you each describe the significance of the deal?

Viliam: A few points to mention that from our perspective make the deal one of the landmarks on the local market: (i) the Rosum office building holds a LEED Gold Certificate, which makes it one of the most ecological buildings in Bratislava; (ii) the structure of the deal required a lot of sector expertise, mainly during the due diligence process, as we were not only focused on simply corporate and/or real estate reviews, but also considered all relevant aspects of operating an office building; (iii) the transaction length – up to eight weeks – makes the Rosum acquisition the fastest transaction among deals of similar volume and complexity in Slovakia; (iv) the deal involved financing by a foreign bank (which, although we see more and more, is still not common) and included simultaneous signing, completion, and draw of funds on the same date as the SPA closing.

Marian: In our view the deal was very significant for several reasons, not just for Penta but for the Slovak real estate market as a whole. First of all, it was done at the right time from our client’s perspective, just before introduction of strict governmental restrictions in relation to the COVID-19 disease, which would definitely have had a negative impact on the timing and consummation of the deal. In terms of volume it was a landmark transaction for the client in Slovakia in the realm of administrative office buildings. Furthermore, the transaction also showed the appetite and trust of foreign investors to invest in Slovakia. And finally, it has reinforced Penta’s position in the administrative office real estate sector (not just as a residential real estate developer).

This Article was originally published in Issue 7.5 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

 

Ivan Males, from Croatia, is Senior Associate with DLA Piper in Vienna. He is a Finance, Projects & Restructuring practitioner with a focus on financing transactions and the infrastructure sector. In addition, he has gained particular knowledge on corporate and M&A cross-border transactions, notably in CEE and SEE markets.

CEELM: Run us through your background, and how you ended up in your current position with DLA Piper in Vienna.

Ivan: This is quite a general question so I guess I should start from the beginning. I was born in the southern part of Croatia, in the city of Split (the second largest city in Croatia), where I attended primary and grammar school. I attended Law School at the University of Zagreb. There, I was an active member of the Institut Francais and Alliance Francaise, and later I continued my studies in Paris at Universite Paris Descartes (Paris V).

Soon after returning to Croatia from France, I started in my first legal role as an associate with Savoric & Partners Attorneys at Law, a top-tier law firm in Zagreb, where I practiced my legal skills on some of the most significant transactions in Croatia. After a few years of practice and passing the bar exam, I moved on to become a senior associate with another prominent law firm on the Croatian market, Glinska & Miskovic. While working with this law firm, I started frequently to collaborate with DLA Piper Vienna on various projects as an external counsel. After several years, our cooperation evolved to its current form.

CEELM: Was it always your goal to work abroad?

Ivan: From my perspective, it was never a question of living abroad. My goal was always to work in a challenging and dynamic environment, while evolving my professional and social skills. That being said, when the opportunity to work in a leading global law firm such as DLA Piper arose, I could not resist. Could anyone? All things considered, I am happy that this professional opportunity led me to Vienna.

CEELM: How would clients describe your style?

Ivan: I would be glad to know the answer to this question! I try to always do my best in every field of work. Growing up in a smaller city taught me to be friendly and understanding, while the studies and career in legal business made me strive for excellence and to be persistent. A combination of these elements, including DLA Piper’s efforts to encourage me to put clients first and understand their business, designed my current approach. I would hope that my clients see me as friendly but professional, relaxed but reliable, rigorous but pragmatic, easy-going but exact and knowledgeable.

CEELM: There are obviously many differences between the Croatian and Austrian judicial systems and legal markets. What idiosyncrasies or differences stand out the most?

Ivan: Actually, the differences between the two are not that significant. Both legal systems belong to the civil law family and, in addition, the Croatian legal system has historically been influenced by the Austrian one. Although, the Croatian legal system originated from the common Central and Eastern European tradition, Croatia had a substantial level of autonomy in its judicial and legislative organization which caused a different application of the same laws (for example, procedural codes were effectively different in Croatia than in Austria). Later on, the similarities between the two legal systems diminished – up until the accession of Croatia to the European Union, when its legal system was almost completely harmonized with European Union law.

The fact that the market in Austria has been more open for years as well as the fact that Austria has been a part of European Union much longer than Croatia had a significant influence on the development of the legal markets.

CEELM: How about the cultures? What differences strike you as most resonant and significant?    

Ivan: Austria and Croatia share similar cultural values originating from shared history. There are no great differences – but if I had to choose something, in my view, people in Croatia are more outgoing, social, and treasure a community lifestyle more, while in Austria people are more reserved and the lifestyle is more individualistic.

CEELM: What particular value do you think a senior expatriate lawyer in your role adds – both to a firm and to its clients?

Ivan: My international experience (both in education and work) allows me to understand how different judicial and legal systems work and, consequently, allows me to have a comparative and solution-driven approach to each cross-border transaction. According to the feedback form my clients, they appreciate having a single point of contact who is able to apply international standards to cross-border deals while keeping an eye on the differences in each local jurisdiction.

CEELM: Do you have any plans to move back to Croatia?         

Ivan: For the time being, no – not even long-term plans of moving back. Vienna is a wonderful city and it comes as no surprise that it has been voted one of the most livable cities around the globe for last several years. So, as I am personally and professionally very happy here, I have no intention of moving anywhere soon. Do not get me wrong, I miss my family and friends – but as Croatia is just a few hours away from Vienna I can easily visit them.

CEELM: Outside of the Croatia (and Austria), which CEE country do you enjoy visiting the most, and why?         

Ivan: This is a difficult question as each country has its own unique traits. If I had to choose, I would say that I enjoy visiting Slovenia, the Czech Republic, and Serbia. Those countries have never disappointed me with what they have to offer – from the night life to local cuisine, from nature to architecture.

CEELM: What’s your favorite place to take visitors in Vienna? 

Ivan: Luckily Vienna has a lot to offer from museums, concerts, film and cinema to restaurants and night clubs. The usual “tourist” path in Vienna depends on the wishes of the visitor – but certain places are not to be missed, such as starting a day with breakfast at Naschmarkt and visiting its flea market, followed by a brunch at Palmenhaus, spending the afternoon with a stroll along the park of Schonbrunn Palace and the Schonbrunn zoo (which celebrated the birth of a baby polar bear recently), riding the rollercoasters in the Wiener Prater, visiting Albertina and Kunsthistorisches Museum Wien for an inspiring exhibition, and so on. I always like to take my visitors to the late-night projections of The Third Man, a 1949 film noir set in post–World War II Vienna, at Burg Kino, and/or have a drink at the Loos Bar, an architectural jewel designed by Adolf Loos, with a fin de siecle interior design that is super attractive.”

All things considered, I am happy that this professional opportunity led me to Vienna.

This Article was originally published in Issue 7.3 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

 

On September 20 2019, CEE Legal Matters reported that BLS had advised Pannonia Bio Zrt. – a company operating a biorefinery in Tolna County, Hungary, that is the largest ethanol plant in Europe – and that CMS Hungary had advised OTP Bank Plc. on Pannonia Bio’s issuance of the first Hungarian forint bond in line with the Central Bank of Hungary’s Bond Funding for Growth Scheme.

The Players:

Counsel for OTP Bank: Erika Papp, Managing Partner, CMS Budapest

Counsel for Pannonia Bio: Gabor Kovacs, Partner, BLS

CEELM: Erika, how did you and CMS become involved in this matter? Why and when (and by whom) were you initially selected as external counsel? 

Erika: We were already working on this product when Pannonia Bio, with whom we have a very good and long-standing relationship, approached us. Since there is lack of experience with transactions of this type in the market, our preliminary work in respect to bond issuances proved essential and helped us secure this deal.

For instance, we represented both issuer and arrangers in several similar transactions prior to this deal such as OTP Bank’s EUR 500 million MREL bond issuance on the Luxembourg Stock Exchange, where we acted as Hungarian legal counsel to OTP Bank as issuer.

Our initial kick-off meeting about this bond issuance proved quite successful. We initially met Pannonia Bio in a local café to discuss bond issuances in general. Following the discussion, we were asked by Pannonia Bio as issuer and OTP Bank as lead arranger to represent OTP Bank in the Pannonia Bio issuance, which marked the first ever bond issuance within the framework of the Bond Funding for Growth Scheme.

CEELM: What about you, Gabor? How did you and BLS become involved in this matter?

Gabor: Our team has acted as the outsourced legal department of the issuer, Pannonia Bio, for more than half a decade. From the outset of this project, we worked closely with management to make sure that the issuance process aligned with their expectations and the way in which the company does business.

CEELM: What exactly was the initial mandate when you were retained for this project at the beginning?

Erika: OTP Bank gave us the mandate to act as counsel for this project. This effectively meant that our colleagues drafted and negotiated several documents (e.g. certain parts of the information memorandum, and other transaction documents) necessary for issuances of this kind, and participated in personal meetings with the main investor, the National Bank of Hungary.

Gabor: We were contracted to manage all legal functions of Pannonia Bio, a major regional producer of sustainable biofuel, animal feed, and other co-products. The mandate was to provide legal counsel in an efficient and transparent way, so that management could focus on business development. Unlike conventional law firms, we advise the company on any and all legal matters around the clock, and in this instance we advised them throughout the bond offering.

CEELM: Who were the members of your team, and what were their responsibilities?

Erika: Dr. Arpad Lantos, senior consultant, and Dr. Zsolt Beregi, junior associate, were responsible for the drafting, negotiation, and timely delivery of the transaction documents.

Arpad has many years of experience in debt capital markets both in regulatory advice and transactional assistance.

Zsolt has an LL.M. degree in International Banking and Finance Law at University Collage London (University of London) and he also has considerable domestic and international experience in debt capital markets transactions including bond issues and regulatory matters both in English law and Hungarian law.

At CMS, we always strive to do transaction management proactively, which we did in the present matter as well. This effectively involves the preparation of documentation, gathering comments from various stakeholders in the transaction, and driving the transaction forward so it can be completed on schedule to the satisfaction of all parties involved.

Gabor: The client’s BLS team consisted of the founding partners, me and Erzsebet Szalay, and associate attorney Mark Bene. I managed the key work streams to make sure that they met the agreed-upon deadlines, and facilitated the seamless flow of information between various parties including the Organizer Bank (OTP), the Issuer’s internal departments, and additional advisors. Erzsebet supervised the corporate aspects of the case and ensured the quality of documentation, while Mark did the heavy lifting throughout the documentation process and technical coordination between the parties.

CEELM: Describe the issuance in as much detail as possible, and your roles in making it happen.

Erika: Pannonia Bio issued the first Hungarian Forint Bond in line with the Bond Funding for Growth Scheme announced by the Central Bank of Hungary in July 2019. For funding the entire programme, an aggregate amount of HUF 300 billion was initially set aside by the National Bank of Hungary, which was increased later. 

Within the programme, issuer companies raise capital through debt financing. By purchasing the bonds, investors become lenders to the issuers and directly finance the operation of such companies. As opposed to the issuance of share and raising capital through equity financing, the purchasers of the bonds do not acquire ownership or voting right in the general meeting of the issuer, and they are not entitled to dividends from the profits.

Generally, in individual issuances, the issuer repays the principal borrowed amount in one lump sum on the final maturity date whereas the interest is paid on a periodic basis. The tenor of the bonds may range from three to ten years from the date of issuance under the programme.

The bonds are issued first to a selected few institutional investors in an auction, and within 180 days of the auction the bonds will be traded in a newly-set up multilateral trading platform of the Budapest Stock Exchange, called the Xbond platform.

Pannonia Bio’s B+ credit rating and good standing helped to decrease the yield on the bonds in the auction procedure and also helped to make the bonds more attractive to investors.

Finally, investors purchased all issued bonds with the National Bank of Hungary purchasing the maximum 50% on first issuance and an additional 20% on the secondary market.

Gabor: The issuance was among the first of its kind under the National Bank of Hungary’s Growth Scheme. The issuance process is relatively standardised, with a few specific rules set by the NBH for this particular scheme. Our biggest added value was to clearly explain the specialties of each party, so that Pannonia could act in a way that ensured that their needs were understood and addressed – all within the tight turnaround time set by the company’s management.

CEELM: What’s is the current status of the issuance?

Gabor: The bonds will soon be listed on the xBond system operated by BET, the Budapest Stock Exchange.

CEELM: What was the most challenging or frustrating part of the process? And why?

Erika: The most challenging part was that this was the very first issue within the scheme and the parties had to be cautious how to price the bond given Pannonia Bio’s high credit rating. The National Bank had to consider future issuances especially in respect to the potential spread offered to investors of future issuances within the programme. The concern was that if the yield on Pannonia’s bond was priced too high, then companies that enter into the scheme at a later stage with lesser credit rating would have to offer a higher yield to investors. This would have led to certain companies being out priced from the future issuances.

Gabor: Being the first in anything is never easy, especially when it comes to implementing a new rulebook set by a financial regulator in a relatively mature and highly regulated environment like bond regulations. We had to cooperate closely with all of the parties involved, especially CMS, to find solutions that could serve as a model for future issuances. Understandably, we encountered a few bumps along the road, but the direct and professional service that we provided eventually paid off. For me, the most challenging task was to clearly reflect Pannonia’s specific considerations as a family-owned private company.

CEELM: Was there any part of the process that was unusually or unexpectedly smooth?

Erika: The whole transaction was completed in less than a month after receiving the mandate due to the professionalism of the teams with OTP Bank and Pannonia Bio. It was easy to get along with them, which helped the smooth completion of the deal.

Gabor: I highly appreciated the efficient and constructive cooperation of CMS throughout the process. Their solid understanding of securities law made things much easier, and they were always open to our business-related comments. 

CEELM: Did the final result match your initial mandates, or did it change somehow from what was initially anticipated?

Erika: The mandate matched the final product.

Gabor: It absolutely did, in the sense that we accomplished yet another important project for Pannonia acting as their outsourced legal department.

CEELM: Erika, what specific individuals at OTP Bank directed you, and how did you interact with them?

Erika: The OTP Bank team consisted of Andras Kazar, Head of Capital Markets Advisory and Securities Services, and Gyorgy Szelényi, Senior Capital Markets Advisor. Most of the communications were done by email or phone. We had regular update calls with both the teams of OTP Bank and Pannonia Bio on the line where we discussed outstanding issues and how to proceed with the transaction.

CEELM: What about you, Gabor? What individuals at Pannonia Bio directed you?

Gabor: We worked with Lajos Dobai, the company’s CFO, who was internally responsible for the issuance at Pannonia. Our relationship with Lajos during the project is a great example of the way we look at the function of an external legal counsel: we worked with him on a daily basis, striving to put him in a position where he could concentrate on business decisions, while leaving the legal and technical matters to us with full confidence. This fits well into our working philosophy of working in tandem with business.

CEELM: How would you describe the working relationship with each other on the deal?

Erika: We have a good standing relationship with BLS. Most of the time the negotiations took place via phone and emails and there was a personal meeting in which the representatives of all parties and the National Bank also participated. The final negotiations were completed within hours. Fortunately, the whole process was smooth.

Gabor: As mentioned previously, the working relationship with CMS is excellent on every level. I appreciate their integrity and dedication to soliciting clear legal advice, as this makes our business legal consulting work much more straightforward. Deals like this involve a lot of iterations, calls, meetings and extensive e-mail correspondence between the working parties. I believe that the key to success is to select the right communication channel for the status of the transaction and the goals of each party. I think the entire project team nailed this, and CMS played a decisive role in making that happen.

CEELM: How would you describe the significance of the issuance to Hungary and CEE in general?

Erika: We advised the very first bond issue within the Bond Funding for Growth Scheme in Hungary. This means that the National Bank of Hungary purchased corporate bonds within the scheme for the very first time. Moreover, in CEE no other bond growth programme offers the possibility for any Central Bank to purchase 70% of issued bonds.

Gabor: Boosting the local bond market via the GS programme was a clear policy goal set forth by the National Bank of Hungary. Had financially stable private companies declined to participate in the programme, achieving that goal would have been challenging. As such, we felt that the entry of Pannonia Bio as a regionally significant player within the CEE region would be an important development for the local economy. As business lawyers that advise clients running operations within the CEE region, we welcome any initiatives that enhance access to funding and develop the region’s financial markets.

This Article was originally published in Issue 7.3 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

 

Theis Klauberg took a circuitous route to managing his eponymous firm in the Baltics. He began his education in Germany, at the University of Hamburg, Heidelberg University, and Humboldt University of Berlin, before obtaining an LL.M. at the University of the Western Cape in South Africa, then concluding his formal education with an MBA at the Baltic Management Institute. His professional career has been no less diverse, as he has worked in Germany, Latvia, Lithuania, Estonia, Belarus, and Zimbabwe.

In January, 2019, Klauberg left bnt in the Baltics, which he had helped found in 2003, to start his own pan-Baltic firm: Klauberg Baltics. We reached out to him to learn more about his career path, growing firm, and plans for the future.

CEELM: Run us through your background, and how you ended up in your current position as head of Klauberg Baltics.

Theis: I am a German lawyer based in the Baltic States, and my bar memberships are from Hamburg, Latvia, Lithuania, and Estonia. I arrived in the Baltics with a group of students from Berlin´s Humboldt University in the 1990s, initially to set up a student exchange program. That student exchange actually still exists, and 20 Latvian and German law students participate in it each year. Following the end of communism in CEE this was obviously a very interesting region, and over the years I decided to become part of this evolving legal market. A Latvian friend and I opened up a law firm in Riga in 2003, which later became one of the founding offices of the CEE law firm alliance bnt.  Following that we founded local law firms in Lithuania, Estonia, and Belarus as part of bnt. The timing was of course lucky, as after EU expansion to the region in 2004 international law firms started to refer a lot more work here. It wasn’t exactly difficult – we picked up a Magic Circle firm over a chance encounter in a Riga hotel bar, and we still advise them regularly today! In 2018 I left the bnt alliance, and as Managing Partner of Klauberg Baltics I oversee the teams in Riga, Tallinn, and Vilnius. I still enjoy the emerging market feeling in this region, but there is a lot more to discover here, and summer in the Baltics is fantastic!

CEELM: What is Klauberg Baltics, and how has it grown since its creation? What’s your plan for the firm?

Theis: It’s a full-service Baltic firm, with four legal focus areas – and another focus is of course on German-speaking inbound investment. We started out with ten legal professionals, and in 2020 the team will grow to 15 lawyers at different levels of seniority. The firm is structured as an integrated legal services provider for the Baltics: Our clients are based in Frankfurt, London, Singapore, and everywhere in-between, and they view the three countries as one (and they often mix them up, even though we keep reminding them that the Baltic States are arranged in alphabetical order from North to South). We are an innovative firm and try to incorporate IT, AI, and new working arrangements, but in terms of the values we represent in our work it’s quite a traditional law firm. Everyone on the team is used to working across borders, cultures, and of course legal systems and practices. The mix simply makes our work more interesting. International exchange is something we also support in other initiatives, such as our international trainee program, and the annual DIS Baltic Arbitration Days conference. The plan is to grow the firm´s capabilities, not necessarily its size.

CEELM: You have moved around the world a great deal in your studies and professional career. Was it always your goal to work abroad?    

Theis: Yes, and after CEE opened up, I wanted to work here. I like the region a lot. It is simply more interesting to work in an emerging market, and there is still a lot of enthusiasm for open markets and the EU here. Also, living abroad in Europe is not as big of a step as it used to be: cheap air travel connects the Baltics to most major European cities, which is quite different from when you had to take a bus for 30 hours to get from Riga to Berlin. Soon you will be able to take a brand-new high speed rail link on that exact route. 

CEELM: How would clients describe your style?    

Theis: Reliable and straight-forward – I hope!

CEELM: There are obviously many differences between the Baltic and German judicial systems and legal markets. What idiosyncrasies or differences stand out the most?   

Theis: The legal and judicial systems of the Baltic States and Germany are actually quite closely-related and similar, especially in business law. Estonia and Latvia for example follow German company and commercial law very closely, and EU law has harmonized most legal areas connected to commerce. Since the end of the USSR and especially EU accession the Baltic justice systems have obviously moved much closer to what lawyers are used to in Germany. Court practice still differs a lot, though not always in a way one would expect: electronic communication, use of IT in legal sources, and electronic signatures are common in the Baltics, but Germany is far behind.  Baltic lawyers struggle to believe that German courts still tend to rely on fax machines rather than email.

CEELM: How about the cultures? What differences strike you as most resonant and significant?    

Theis: The Baltics are very open to IT and innovation in general. Germany is actually quite conservative and changes are slow, whereas in the Baltics there have been 30 years of constant change. There is a very open business culture here, and investors like that. Regarding the office culture in the Baltics, there is a tradition to create a good working environment, and help each other out. For Baltic lawyers, international assignments are common. Whereas in most Baltic business projects there is a cross-border element, German lawyers in even large firms may never deal with international issues in their entire career.

CEELM: What particular value do you think a senior expatriate lawyer in your role adds – both to a firm and to its clients?

Theis: Ideally they bring a network of contacts and international experience, and they can ease communication with expat clients. Knowledge of different jurisdictions makes it easier to explain legal concepts, or evaluate risks from the client’s perspective. For the firm itself it may be an advantage to introduce the kinds of work processes and outcomes that Western clients are familiar with.

CEELM: Do you have any plans to move back to Germany?         

Theis: I haven’t thought about it, and the Baltics are very attractive to live and work in, so most likely Germany is more for visiting than to move back to.

CEELM: Outside of the Baltics, which CEE country do you enjoy visiting the most, and why?         

Theis: That’s a hard question, I like visiting the Caucasus region, and would like to get to know Ukraine and Russia much better. Romania and the Balkans are on top of the travel list. Rather than a particular country I always enjoy visiting the main cities in CEE, their unchanged architecture, or brand new developments next to cafes unchanged since the 1980s.

CEELM: What’s your favorite place to take visitors in Riga?

Theis: Miera iela has become a favorite to go out, it has kept the distinct and slightly chaotic feeling of the 90s, pop-up bars and cultural events in former factory buildings. But if you allow Riga’s beach resort of Jurmala to be counted here, I would recommend heading there by train to enjoy the sea and the impressive architecture. Indeed, our Baltic Arbitration Days conference on August 15-17 would be an excellent opportunity to see both Riga and Jurmala.

Editor’s Note: This article has been updated to reflect the rescheduled dates of the Baltic Arbitration Days conference.

This Article was originally published in Issue 7.2 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

 

In February 2019 CEE Legal Matters reported that Integrites and K&L Gates had advised Norwegian utility-scale wind power developer NBT and Paris-based renewable energy independent power producer Total Eren on their entrance into a framework agreement with a syndicate of foreign lenders, including the EBRD and the Nordic Environment Finance Corporation, for the construction of the Syvash wind farm – one of the largest in Europe. Redcliffe Partners and Clifford Chance advised the lenders and J.P. Morgan Securities Plc as debt coordinator.

We reached out to Integrites, K&L Gates, and Redcliffe Partners for more information about the deal, and how they made it happen.

The Players:

•  Counsel for NBT and Total Eren: Alex Blomfield, Partner, K&L Gates; and Oleksiy Feliv, Managing Partner, Integrites
•  Counsel for the Lenders: Olexiy Soshenko, Managing Partner and Head of Banking and Finance, Capital Markets and Debt Restructuring, Redcliffe Partners

CEELM: Alex and Oleksiy, how did you and K&L Gates/Integrites become involved in this matter?

Alex: I had acted for NBT on their wind projects in Pakistan at a prior firm but had fallen out of contact. I reconnected with Joar Viken (NBT’s CEO) and Thorstein Jenssen (SVP, Corporate Finance) in June of 2017 on a visit to Oslo (where I used to live) and learnt about NBT’s plans for the Syvash project. Following this meeting I made a number of useful introductions to NBT in relation to the Syvash project, most notably to potential lenders including the European Bank for Reconstruction and Development, the Black Sea Trade and Development Bank, and DEG, but also to advisers such as Marsh and Integrites. Following these introductions, NBT mandated us as international counsel.

Oleksiy (Integrites): I was originally contacted by Alex Blomfield at K&L Gates. Alex got my contact from his partner, Ian Meredith. At the time, Alex was already involved in assessing with the due diligence report that was prepared by another Ukrainian law firm. We discussed our experience in renewables (going back to 2009, when the feed-in tariff program was first established in Ukraine) and agreed that Integrites would assist with the due diligence report, which required further project-specific input. We provided our comments on the report to NBT, following which NBT decided to retain us as a local counsel in Ukraine. 

CEELM: What about you, Olexiy? How did you and Redcliffe Partners become involved in this matter?  

Olexiy (Redcliffe): We were approached by Clifford Chance, London office, at the end of October 2017, asking us to provide a fee quote and act as Ukrainian legal adviser to J.P. Morgan Securities plc, which was a mandated lead arranger in this deal. We also met with representatives of J.P. Morgan in London to present our capabilities.

CEELM: What, exactly, was your mandate when you were first retained for this project? 

Alex: Our original mandate in August 2017 was to advise NBT on political risk and structuring with particular focus on investment treaty protection and tax efficiency. 

Oleksiy (Integrites): The original mandate was to check the charter of the special purpose vehicle. We were then further mandated to evaluate the due diligence report as described above. 

Olexiy (Redcliffe): The initial mandate contemplated the implementation of a senior and mezzanine secured debt structure, which required a review of the senior and mezzanine level finance documentation and the preparation of two sets of Ukrainian security documents to provide for first and second ranking security. In general, the initial Ukrainian scope contemplated the preparation of limited legal due diligence of the borrower (including the corporate part), a review of the project agreement, licenses and permits, and limited title due diligence for the purposes of the Ukrainian security documents. We also undertook a corporate check for the purposes of the Ukrainian legal opinion with the provision of a “red-flag” due diligence report, a review of a set of finance documents from a Ukrainian law perspective, drafting, signing, and perfecting the Ukrainian security documents, reviewing and collecting CPs, and the issuance of a Ukrainian capacity and enforceability opinion.

CEELM: Who were the members of your teams, and what were their individual responsibilities?

Oleksiy (Integrites): I led the project at all stages. In particular, I worked on the project due diligence, the Share Purchase Agreement, and negotiations for the engineering, procurement, and construction contract and the signing and closing of the first loan segment with the banks. Since-departed Partner Vsevolod Volkov was involved in the negotiations, drafting, and closing of the financing. Partner Igor Krasovskiy, who replaced Vsevolod, was involved in the second financial close.

Senior Associate Olena Savchuk reviewed and elaborated on the transaction documentation, assisted with the execution and perfection of the security at the Ukrainian level, advised on financing issues related to the transaction (including the PowerPurchase Agreement), and led negotiations with the NBU and the client’s servicing bank. Counsel Gennadii Roschepii managed and supported on construction and energy matters, [helped with] obtaining all necessary permits, licenses, and other documents, drafted and organized the signing of EPC Contract and security documents, and advised on ongoing construction issues. Senior Associate Dmytro Kiselyov was involved in the SPA and Escrow Agreement drafting with respect to the project and drafting the EPC in relation to local law issues. Since-departed Senior Associate Anton Babak drafted and negotiated the SPA and coordinated all corporate work on the project. 

Partner Viktoriya Fomenko provided tax and customs support on the SPA, EPC, and financial documents. Partner Dmytro Marchukov and Counsel Serhii Uvarov, both from the arbitration and cross-border litigation practice, assisted in the preparation of a memorandum on enforceability of the contract for the electricity purchase in Ukraine and on a mechanism for guaranteeing investment in projects under the “green tariff,” and Associate Andrii Lasikov provided legal advice on merger concentration issues.

Alex: I led the K&L Gates team at all stages of the project. In particular, I worked on the initial acquisition of the Syvash project company, initial project development, project due diligence, construction and O&M tendering, EPC and negotiations, WMSA and negotiations, and both of the project financing segments. Since-departed Partner Mayank led project financing for Segment 1. Partner James Green led the corporate piece that included reviewing, negotiating, and drafting the SPA and ancillary documentation.

Senior Associate Joshua Spry was involved in the preparation of EPC and WMSA tender drafts, supported project financing for segment 1, and managed financial close for Segment 2, and Associate Francis Iyayi was involved with the negotiation of EPC and WMSA and supported project financing for Segments 1 and 2. Departed Associate Caroline Urban assisted on the corporate piece that included reviewing, negotiating, and drafting the SPA and ancillary documentation. Associate Peter O’Donnell supported project financing for Segment 1 and Segment 2, with Associate Sherry Scrivens and Trainee Hannah Davies supporting project financing for Segment 1. Finally, trainee Francesca Norman supported the tendering process, EPC negotiations, and WMSA negotiations.

Olexiy (Redcliffe): Apart from banking and finance work the team for this project involved a number of lawyers from different practice areas, such as regulatory in alternative energy, real estate, tax, and customs matters, and from dispute resolution for the analysis of potential future protections of lenders’ and investors’ rights in the event of a breach of the obligation to pay the feed-in tariff by the state. I was responsible for general coordination and supervision. Senior Associate Evgeniy Vazhynskiy was responsible for the ongoing structuring, banking, currency control and security-related advice, the preparation of the due diligence report, the review of finance documents, and for the drafting and negotiating of Ukrainian security documents. Counsels Svitlana Teush, Oleksandr Markov, Anastasia Usova, and Partner Sergiy Gryshko were also involved, and they were supported by Junior Associates Eduard Olentsevych and Bogdan Nykytiuk, who were responsible for legal due diligence, the review and collection of CPs, signing and perfecting security documents, and preparing the Ukrainian legal opinion.

CEELM: Please describe the deal in as much detail as possible. 

Oleksiy (Integrites): The Syvash Wind Farm Project of up to 250MW is situated on approximately 1,300 hectares of land in the Chaplynka district of the Kherson region of southern Ukraine. The sponsors were a subsidiary of utility-scale wind power developer NBT AS, Total Eren SA (a Paris-based renewable energy independent power producer), and Al Gihaz Holding, a Saudi Arabian conglomerate. Financial close was reached for Segment 1 of the project at the end of January and Segment 2 in mid-April 2019.

First, the customs and tax issues involved in the Syvash project were complex. In a new approach for wind farms in Ukraine, the project agreements for the Syvash project provided for delivery duty paid terms of delivery under Incoterms 2010, which made the relevant contractor in each case responsible for arranging carriage and delivery of the goods at the named place, cleared for import and with all applicable taxes and customs duties paid and wrapped up in an all-inclusive EPC contract price for the goods and therefore providing a level of certainty for sponsors and developers of projects. Resolution of these issues was a particularly good example of Integrites and K&L Gates working well together as it required deep knowledge and experience of local requirements as well as the ability to find a solution within those constraints that met the need of the sponsor and the preference of its lenders that the EPC contractor retain responsibility for customs clearance and payment of customs duties, fees, and charges.

The Syvash project was financed by a consortium of development finance institutions, third-party debt from financial institutions, and the sponsors’ equity. Segment 1 of the project financing involved the provision by the relevant banks of an A/B loan of up to EUR 155 million for the construction of the initial 133 MW of the wind park. The EUR 155 million of senior debt for Segment 1, containing 34 turbines, was signed on January 21, with the EBRD committing to EUR 150 million (including EUR 75 million in B loans from the Green for Growth Fund and the Netherlands Development Finance Company) and EUR 5 million from the Nordic Environment Finance Corporation.

Over EUR 107 million of further senior debt for Segment 2, for an additional 29 wind turbine generators, was signed on April 8, 2019, with EUR 30 million committed by the Black Sea Trade & Development Bank, EUR 15 million from Finnfund, EUR 15 million from the IFU, EUR 5 million from the Nordic Environment Finance Corporation, and EUR 42,638,036.90 committed by Proparco. The lenders agreed to allow the sponsors to enter into commitments for additional facilities following the commercial operations date and to adjust the project’s leverage if certain tests are met at the relevant time. 

Base equity contributions from the sponsors – NBT, Total Eren, and Al Gihaz Holding – exceeded EUR 110 million for Segments 1 and 2. 

Due to the quality of deal execution and the service provided, we managed to build up such confidence in the Syvash project that the debt financing could be arranged despite the imposition of martial law during a key period for finalizing the finance documents for Segment 1. In addition, the parties were able to finalize the finance documents for Segment 2 and reach the second financial close despite the volatility caused by the occurrence of presidential elections in the middle of the process.

The borrowers received technical, environmental, and social advice from Wood Group UK, insurance advice from Marsh, and Swedish legal advice from Advokatfirman Torngren Magnell. 

The sponsors and their advisers, with support from the lenders and relevant agent and account bank parties, worked closely with the NBU to agree on an accounts structure that met Ukraine’s new regulatory requirements (including the new regulatory framework for currency control that came into effect in the country on February 7, 2019) and allows for upstreaming of foreign currency to offshore secured accounts.

Finally, an important element of the financing of Syvash was the standard lender expectation for the parties to enter into a suite of acceptable construction and service contracts. As such, the parties agreed on an EPC with the Power Construction Corporation of China Ltd (PowerChina) and Powerchina Fujian Engineering Co Ltd, and a subcontract with the Nordex Group for the supply of 63 turbines from the N131/3900 series in multiples of 3.9MW, thereby combining a Chinese EPC contractor with a leading European turbine supplier. 

In addition, Syvash entered into a 15-year warranty service and maintenance agreement with Nordex Energy GmbH and a Nordex subsidiary in Ukraine as service provider. Traditionally, wind projects in Ukraine have been implemented under split contractual arrangements, separately for turbine supply on the one hand and installation and the balance of plant on the other hand. The Syvash project, however, benefits from a fully-wrapped single point of contact EPC, thereby enhancing bankability. To achieve this, NBT leveraged its deep experience of owning, financing, and operating wind farms in China to select and negotiate with PowerChina, one of China’s largest EPC contractors. As such, the Syvash project is one of the few wind farm projects in Ukraine with an internationally-recognized EPC contractor.

CEELM: Thank you for that extensive summary Oleksiy. Olexiy, what about from the Redcliffe Partners’ side?

Olexiy (Redcliffe): The deal was a traditional project financing to be arranged and syndicated by J.P. Morgan to institutional investors and IFI and DFI lenders. It initially contemplated several levels of debt, including senior secured debt by various financial institutions and mezzanine secured debt to be extended by institutional investors on the offshore HoldCo level. This was to be further on-lent to the Ukrainian SPV for the construction and operation of a wind power plant. Senior lenders expected to be involved included international financial institutions, development financial institutions, foreign commercial banks and Ukrainian banks. Private investors under the senior and junior facilities were expected to benefit from political risk insurance cover (PRI) to cover war/expropriation/convertibility/breach of PPA from OPIC, MIGA, or an equivalent provider. The transaction also contemplated the implementation of an offshore and onshore project accounts structure usually used in international project finance deals. Subsequently, the mezzanine facility and PRI were dispensed with, whereas the senior financing was split into two segments, with EBRD and NEFCO funding the first segment and the remainder of the DFI lenders –BSTDB, Finnfund, Proparco and IFU – later acceding to the deal to fund the second segment. Unfortunately, eventually neither foreign commercial nor Ukrainian banks joined the deal. The mezzanine facility was replaced with equity contributions to be made by the sponsors (NBT AS and Total Eren) as project support.

CEELM: What was the most challenging or frustrating part of the process?

Alex: There were four main challenges: First, we had to provide solid legal answers/responses and persuade all the lenders that the Ukrainian feed in tariff (or “FiT”) system is good enough to provide financing. This was not easy as the model PPA contains a parallel litigation and arbitration clause, no termination payments, and no change of law protection, along with other perceived and actual shortcomings. The foregoing meant real challenges for bankability from an international lender perspective. Thus our original report on structuring for NBT evolved into a major report which covered the potential of investment treaty protection to mitigate against some of the country risks related to the payment of the FiT. In addition, we produced separate reports on dispute settlement and other bankability issues in the PPA and generally speaking worked hard over many months to convince lenders of the bankability of the Ukrainian FiT system and PPA.

Second, we were advised on the project financing, which has not been executed at such scale and with such set-up in Ukraine before (among other things this was the first limited recourse financing of a wind farm in Ukraine). We faced difficulties in implementing internationally accepted project finance solutions in the Ukrainian legal and regulatory environment. The standard documentation required by Ukrainian authorities did not provide for the level of legal certainty and comfort that the sponsors wanted. There were no standard answers and very often we had to work closely to come up with and adapt solutions in parallel to the adoption of new laws and regulations.  

Third, we structured the deal with a full-wrapped EPC which has not been done before in the wind industry in Ukraine. This again required many non-standard approaches and legal solutions and no small amount of lateral thinking when obstacles arose. 

Finally, another bottleneck arose out of the February 7, 2019 change in the regulatory regime for currency control that affected the project’s closing. Apart from aligning all documentation to fit into the new rules, we were also met with a lack of understanding by the National Bank of Ukraine of transaction funds flow and had to walk them through it working jointly to elaborate the NBU’s new approaches to cross-border matters. We had to explain, among other things, such items as (i) how the debt service reserve accounts should work under the new rules, (ii) how the currency should flow from onshore to offshore accounts, (iii) whether or not the funds could be accumulated for future payments onshore and offshore, and (iv) what the approaches to interest rates should be now that the rate limits have been cancelled. Once again successfully resolving these matters required close cooperation between us.

Olexiy (Redcliffe): The most challenging part of the deal was the implementation of a complex offshore and onshore project accounts structure. The transaction was undertaken during Ukraine’s transition from an old, strict currency control regime (which made it virtually impossible to implement a traditional project financing account structure) to one that was more liberal but still evolving and largely untested. This resulted in quite difficult and protracted negotiations between the parties, the Ukrainian account bank selected to service the payments (Citibank Ukraine), and the National Bank of Ukraine as the regulator responsible for Ukraine’s currency control regulatory framework.

The most “frustrating” element, in our view, was the unsuccessful attempt to obtain political risk insurance for the private investors, which availability would likely attract more commercial lenders (such as foreign banks). Also, we believed the Ukrainian banks should express a greater appetite to participate in such deals, but it appeared that Ukrainian banks still experience various commercial and legal obstacles preventing them from providing project financing to Ukrainian SPVs.

CEELM: Was there any part of the process that was unusually or unexpectedly smooth/easy?

Oleksiy (Integrites): We were surprised by the extreme preparedness of all parties to meet the common goal and to move the deal to financial close and success. This went not only for sponsors and lenders, which is understandable, but also to third parties like insurers, servicing banks, and – much to our astonishment – the NBU. In particular, the NBU was willing to have numerous calls and hold several meetings to align on positions and provided general support in currency related matters. This is something very unusual in the Ukrainian realm.

Coordination among the lenders (and between the lenders and the borrower) was also something that went more efficiently than we expected. As the project consisted of a large international structure, the NBU could have dragged its feet on the process due to bureaucracy, but instead often took a business-oriented approach and endeavoured to help the project to come together and reach financial close sooner than expected.

Alex: I second everything Oleksiy says but would also add that such a close and enjoyable working relationship with local counsel in Ukraine was not something I necessarily expected at the beginning of the process. Not only have I gained a close professional working relationship with Integrites but I also have developed friendships with Integrites’ lawyers that provide another reason why I am eager to do more business in Ukraine.

Olexiy (Redcliffe): Compared with other, similar deals, the Ukrainian security documents negotiation process was quite smooth and straightforward and the documents were agreed promptly. On the funds debiting agreement, which often requires additional time to agree, the process was further complicated due to the changes in legislation and certain gaps in such legislation.

CEELM: Did the final result match your initial mandates, or did it change/transform somehow from what was initially anticipated? 

Oleksiy (Integrites): It expanded. The deal initially was expected to have a lot of standardized elements – FIDIC contract, EBRD and other IFIs templates and policies, etc. But during our due diligence checks and contractual deliberations we occasionally discovered something that required extra thought or clearance. Our scope and fees, therefore, grew ten times from what was agreed initially.

Alex: Not only did we act as international legal counsel throughout long and complex negotiations, with new challenges constantly arising, but also as project managers and trusted advisers. This was due to the closeness of our relationship with the NBT and the comparative smallness of the NBT team. This also meant that we spent a lot of hours that we did not anticipate at the beginning of the deal.

Olexiy (Redcliffe): Not exactly. Some parts fell away (such as the PRI, mezzanine facility, VAT facility, and having Ukrainian banks as lenders) whereas other matters became more extensive compared with the initial scope. For example, we undertook an exhaustive legal due diligence of the borrower, including in the report extensive renewables market advice, financing and currency control, and regulatory and tax advice, which usually are not included. It is important to note that the electricity market is undergoing fundamental reform [in Ukraine], including: the new electricity market to be created; the off-taker being replaced by a new entity called the “guaranteed buyer”; a new template of the power purchase agreement being created; auctions for the feed-in tariff being introduced; balancing; and many other issues. This reform makes the implementation of renewables projects somewhat of a moving target. Also, we received a lot of follow-up and related queries from all lenders involved (including from sub-participants). The accounts structure initially contemplated an NBU-licensing arrangement, which was initially “blessed” by the NBU, but the new currency control regime came into effect and a new arrangement had to be reached  with the NBU, the account bank, and the borrower.

CEELM: Oleksiy and Alex, what specific individuals at NBT and Total Eren directed your team’s work, and how did you interact with them?

Olexiy (Redcliffe): We were impressed by the fact that the client’s top management was not only always available for discussions or guidance, but also actively participated in pushing the deal through all authorities and negotiations. Thorstein Jenseen and Joar Viken were always available to meet and to talk and always willingly attended the all-party negotiations, including with Ukrainian authorities. CFO Ketil Sundal and Ukraine Country Manager Vlad Kazak were also supportive and fast in providing all necessary factual information and documents. 

On the Total Eren side, we are much obliged to Project Finance Director Victoire Potel, who at certain occasions stepped in to facilitate the reaching of an agreement among all parties and to coordinate the expedited closing of outstanding matters on all ends. On our calls she often was the one leading the process and pointing to clear and definite answers and instructions.

Alex: Our interaction with NBT and Total Eren (once they joined the project) was close and frequent. We worked closely with Walter Chang, the CEO, Asia Operations and then-VP Business Development Kyrre Lund of NBT over the long hours of many months negotiating the EPC contract with PowerChina and the WMSA with Nordex. Thorstein Jenssen led on the project financing for NBT and displayed a cool head, excellent judgment and a patient capacity for long hours and hard work throughout the process. We also worked with Ketil Sundal in relation to the Accounts Agreement and shareholder loans. Joar Viken was available for key meetings and always willing to act decisively when required to break logjams as well as maintaining optimism and belief in the project in the face of apparently bad news from time to time. 

On the Total Eren side, we were chiefly instructed by Victoire Potel and VP, Corporate & Business Development Yonatan Shek in relation to the financing, both of whom were tenacious in their pursuit of a better deal for sponsors. We also worked with Senior Business Developer Charles Vallee on the financing and General Counsel Thierry Clementz on the service agreements. For the EPC contract and WMSA, our instructions from Total Eren came via Head of Wind Procurement and Construction Catalina Acosta, Wind Procurement and Construction Manager Francesc Grau Castella, Executive Vice President – Global Head of Business Development Fabienne Demol, and Yonatan Shek. 

Olexiy (Redcliffe): The EBRD team was primarily represented by banker Pavle Milekic and legal counsel Joel Baranowski, who were actively involved in the loan documentation negotiation process and to whom we provided ongoing structural, legal due diligence, and renewables regulatory and currency control advice. The NEFCO team involved senior investment manager Amund Beitnes and senior legal counsel Ritva Kauppi, to whom we responded on legal due diligence queries and renewable regulatory issues

CEELM: Oleksiy and Alex, how would you describe the working relationship between your two firms on this? 

Oleksiy (Integrites): Approximately by the middle of the project everyone started seeing that numerous e-mails to the groups often exceeding 40 people were inefficient. That is when we started flying to London, Oslo, Paris, Kyiv – to simply look each other in the eyes while discussing yet another financial covenant or certification requirement. Being in one and the same room often helped [everyone] be more committed and get to the root of the matter and omit redundant overtures. Draft documents shortened to page pulls only, and everybody became more human (not forgetting professional ethics, of course). And I can say that we became friends, because we started sharing not only professional approaches, but also meals and personal insights. This helped me better understand Nordic culture and their way of approaching business. 

There were no final negotiations, as such. But it feels that the final destination point of the deal (and simultaneously the starting point for the project) was when the lenders’ advisors had issued the Conditions Precedent satisfaction letter and the first tranche reached the account of the borrower. The satisfactory feeling of congratulating each other, publishing press-releases and issuing invoices! But also seeing how the equipment is being imported and installed on the site and the new power plant being erected.

Alex: Too many emails, numerous calls, and comparatively efficient face to face meetings held over many months!

CEELM: And how would you describe the working relationship with Redcliffe Partners and Clifford Chance on the deal?

Oleksiy (Integrites): Clifford Chance and Redcliffe Partners conducted themselves highly professionally, and no less important, as result-oriented lawyers. 

CC took the role of project lead and managed the collection and exchange of all required documentation. They also introduced us to several interesting online platforms that help monitor the processes and reduce the usage of paper – we are looking closer on using them further in our work because this accelerates dealings drastically. Alas, not many firms in Ukraine are used to this.

Compared to CC, Redcliffe Partners’ team is smaller, but they managed to be efficient and deliver expedited support. When something could be delivered in scanned copy, they allowed it to be delivered in scanned copy. And when the laws were ambivalent, they opted for a choice that could advance the deal. They always were able to explain the rationale behind their selections and requirements, which is a rather rare occurrence among the Ukrainian legal fraternity. 

Alex: Clifford Chance’s lead partner on the financing, Simon Williams, did an excellent job managing the lender group and he was supported in dedicated, thorough, and tireless fashion by Natalia Veriasova and Tina Xu. CC’s project document lawyers Leo Rudolph and Tom Ward were rigorous but also commercial in their review of the EPC contract and warranty, maintenance and service agreement, as well as a number of amendments to each (largely caused by delays to financing). 

Redcliffe Partners had a reputation as technically good lawyers. Olexiy Soshenko and Evgeniy Vazhynskiy on RP’s financing team lived up to this reputation but also showed the necessary pragmatism and problem-solving skills to get the deal done despite ongoing challenges.

CEELM: Olexiy, how would you describe the working relationship between your side and Integrites/K&L Gates on the deal? 

Olexiy (Redcliffe): There was a lot of ongoing negotiation and communication between the lawyers. We had several lawyers’ meetings in Kyiv and had a lot of bilateral calls with Integrites’ lawyers on a daily basis to iron out various local law issues. Also, Redcliffe, Integrites and K&L Gates participated in several meetings with the National Bank of Ukraine to resolve the accounts structure issues. Aside from that, there were several all-party negotiating sessions held in London (arranged by Clifford Chance) and Paris (arranged by Total Eren) with physical signing of most of the finance documents. We were quite satisfied with the level of cooperation between legal counsel and their overall responsiveness. Despite being on different sides, the main goal of the lawyers was to complete the deal despite various hurdles, ensuring at the same time that the interests of their parties are protected. The lawyers worked hard, being proactive and practical at the same time.

CEELM: Finally, how would you all describe the significance of the deal?

Oleksiy (Integrites): The Syvash project is unique in the Ukrainian energy market, considering its size, the amount of finance involved, and its contribution to the development of wind energy in Ukraine. Once commissioned, it will be one of the largest renewable energy projects in Ukraine and will produce approximately 900,000 KWh of electricity per year. This will be enough to supply the electricity needs of approximately 100,000 households. It is planned that the project will create around 180 jobs in the long-term.

It is the first large-scale limited-recourse financing project in renewable energy in Ukraine and the first limited-recourse financing for a wind power project in Ukraine. It is also unique in the volume of financing, with the total syndicated loan amount reaching EUR 372 million.

The project also constituted the first investment or involvement in the Ukraine market for developers NBT and Total Eren, EPC contractor PowerChina, turbine supplier Nordex, and development finance institution lender Proparco. This vote of confidence in renewable energy in Ukraine creates positive dynamics for further foreign investment in Ukraine and shows the accessibility of the Ukrainian market for international investors and project financing.

The Syvash project demonstrates that foreign investors will commit to the market when presented with an attractive offering. There are ongoing challenges but with a project such as this as a blueprint, opportunities can only increase. It will also give a boost to the development of local infrastructure and neighboring power facilities necessary for the wind power plant’s proper functioning. Moreover, this project will create a precedent for structuring and realizing further renewable energy projects in Ukraine.

Olexiy (Redcliffe): In our view the Syvash deal is a landmark transaction in Ukraine as, in many respects, it is a unique, breakthrough deal which should give a new impetus to project financing in Ukraine and demonstrate that Ukraine is open to such investment opportunities. It may also provide borrowers and lenders with sufficient new precedent instruments and comfort to enable their participation in future similar projects. It is not the first renewables financing in Ukraine, but it is the largest (in terms of amount of financing attracted, and power plant capacity) and most complex so far. It has expanded the list of potential lenders who may be interested and willing to provide project financing to various development financial institutions, some of which were not very active, if at all, in Ukraine. This is the first deal to establish the offshore and onshore accounts structure that foreign investors typically expect to see in project financing, and which is now an important precedent for future reference..

This Article was originally published in Issue 6.8 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Earlier this year, CEE Legal Matters reported that Herbst Kinsky Rechtsanwalte had advised Marinomed Biotech AG on its February 1, 2019 debut on the Vienna Stock Exchance, with Weber & Co. advising Erste Group Bank AG (as sole global coordinator) and Goetzpartners Securities Ltd (as co-lead manager) on the IPO. Marinomed’s was the first successful IPO in Austria since BAWAG’s in 2017.

The Players:

•  Counsel for Marinomed Biotech: Philipp Kinsky, Partner, Herbst Kinsky
•  Counsel for Erste Group Bank and Goetzpartners Securities: Christoph Moser, Partner, Weber & Co.

CEELM: Philipp, can you tell us what exactly Marinomed Biotech is? 

Philipp: Marinomed specializes in the development of innovative products based on patent protected technology platforms in the field of respiratory and ophthalmic diseases. Marinomed has developed two platforms to date: the Marinosolv technology platform and the Carragelose platform. The Marinosolv technology platform enhances the efficacy of hardly soluble compounds. This innovative technology has the potential to sustainably change a number of therapies for allergies and auto-immune diseases. The flagship product, Budesolv, is currently being investigated in a pivotal Phase III approval study. The Carragelose platform is already used in six different products – sold globally via the company’s partners – to treat viral infections of the respiratory tract. 

CEELM: And how did you and Herbst Kinsky become involved with helping the company in this matter?

Philipp: We have been legal adviser to Marinomed since its foundation in 2006, so based on this longstanding and profound relationship and due to our reputation in the capital market law area Herbst Kinsky was the logic choice for Marinomed. A high level of trust connects us with founders Andreas Grassauer and Eva Prieschl-Grassauer. Knowing what Marinomed means for the founders we are especially proud to be chosen as the company’s legal representative.

CEELM: And Christoph, how did you and Weber & Co. become involved? 

Christoph: The assignment of our firm for the IPO is the result of trusted relationships with national and international investment banks and a long-standing track record of advising banks as underwriters and bookrunners on Austrian equity capital market transactions. Our firm is well known in the market as a go-to-firm for underwriters in ECM matters. Further, the IPO assignment was a follow-up assignment to the issue of pre-IPO convertible debt instruments by the issuer back in 2017, when we also worked for Erste Group Bank AG as arranger’s and sole coordinator’s legal counsel. In that 2017 transaction, Philipp Kinsky was involved as issuer’s counsel as well. 

CEELM: What, exactly, was the initial mandate when you were retained for this project?

Christoph: The initial mandate did not change later. But of course during an IPO process lasting for more than three quarters of a year new issues and tasks always pop up. As an experienced ECM lawyer you know the rules of the game and are aware that in particular transaction structures and involved parties may change. However, the focused and wonderful Marinomed Biotech team knew right from the beginning that they want to go for an IPO and all parties involved ensured that even after rough capital market developments in October and November 2018 the transaction could be completed in early 2019.

Philipp: Herbst Kinsky was mandated in the course of the convertible bond issuance in 2017; as this bond included the right to convert debt into equity upon an IPO, initial preparations for the IPO commenced soon after the issuance of the convertible bond in 2017. Initial preparations also included the development of a legal structure to convert existing silent partnerships held by ARAX.

CEELM: What is ARAX?

Philipp: ARAX Capital Partners manages several funds (limited partnerships, predominantly funded by private investors) that invest in Austrian tech and life science companies via silent partnerships. Those partnerships become repayable by the target companies upon certain conditions. To retain as many IPO proceeds as possible for the company’s operations, Marinomed and ARAX agreed on the conversion of the silent partnerships into equity (instead of repayment of silent partnerships) by transferring shares from existing shareholders to ARAX funds against contribution in kind of their silent partnerships into Marinomed.

CEELM: Who were the members of your teams, and what were their individual responsibilities?

Christoph: Our Weber & Co. team consisted of a mix of partners and associates, all with significant experience in capital market transactions. I took over the overall project lead and transaction structuring and acted as the central contact for involved parties from the issuer’s side and our client banks’ side. Further, I supervised the responsibilities for the due diligence, prospectus, and documentation work on the banks’ side. Our firm’s team also included Partner Stefan Weber, who contributed in particular on matters related to the underwriting agreement, as well as Associates Angelika Fischer (who jointly took over the project management lead with me), Yvonne Gutsohn and Clemens Nostler.

Philipp: Our team at Herbst Kinsky consisted of partners and associates specialized in capital market law, as well as IP experts and an employment lawyer. I have been in the capital market business since 2000, and I led and supervised the team. I was supported by our new partner – Philipp Baubin – who was responsible for drafting the prospectus. Furthermore, Associate David Pachernegg was in control of the due diligence process and guided our team of Felix Kernbichler, Georg Durstberger and Magdalena Wagner. Our IP/IT Partner Sonja Hebenstreit, with the support of Christina Perez and Alexander Holler, was responsible for all IP/IT related issues in connection with the offering. Tanja Lang was in the lead regarding various employment law matters.

CEELM: Please describe the IPO in as much detail as possible. 

Christoph: The IPO consisted of a cash capital increase aimed at raising new equity funds for the issuer for developing its product pipeline. It became clear at an early stage that the transaction would not include any sales of shares by existing shareholders as management and core shareholders believed in the issuer and its future and therefore committed to stay on board and partially also bought new shares in the IPO. Therefore, the transaction structure was set at a rather early stage. The IPO process was commercially managed from the banks’ side and in particular Erste Group Bank played a leading role in the support of the prospectus drafting by the issuer and its legal counsel Herbst Kinsky. 

On the issuer’s side, Philipp Kinsky and his team did a fantastic job managing numerous tasks to be completed, including dealing with all corporate law issues, holding the pen on the prospectus drafting, assisting the issuer and the auditor on the intense prospectus work, managing the due diligence process and ensuring that the conversion of the pre-IPO convertible bond will work in the end after the IPO. As to certain matters of US law, Herbst Kinsky and the issuer were assisted by Clifford Chance LLP Frankfurt, which focused on the US-law-related offering aspects (Rule 144A offering to US investors).

Our firm primarily focused on tasks such as commenting the prospectus, conducting a legal due diligence for the banks’ side, commenting on corporate documentation, drafting and negotiating the underwriting agreement, negotiating the comfort letter, issuing legal opinions vis-à-vis the bank, advising on the offering structure, and taking a lead in the overall transaction management on behalf of the underwriters.

Overall, an IPO provides for numerous tasks to be completed and it was a true pleasure having the right counter-parties on the transaction: a great Marinomed team, diligent, hard-working and experienced lawyers of Herbst Kinsky, an auditor (BDO) who knows the rules of the game and supported with advisory and audit feedback in a stunning way, the experienced US team of Herbst Kinsky and, of course, highly professional bank teams, with Erste Group in particular being true experts for Austrian ECM transactions and IPOs.

Philipp: The IPO process consisted of the several work streams, including the various corporate law measures in connection with the capital increase, the due diligence work, and prospectus drafting, as well as establishing the underwriting documentation between the banks and the issuer. 

Another challenge of this transaction was the conversion of the pre-IPO convertible bond and silent partnerships held by ARAX. However, while this was demanding, we also benefitted from the fact that cooperation between the various teams was kind of “tested” and already well-attuned before we entered into the IPO work and that we could also build our work on certain preparations made in the course of work for the Pre-IPO convertible bond (for example, the due diligence and parts of the prospectus documentation). 

Throughout the entire process, we have definitely benefited from the great cooperation between the various teams. The Erste Bank team, Clifford Chance as US counsel, BDO as auditor, Weber & Co. as issuer counsel, PR-advisor Metrum, and not least the entire Marinomed team, all did a great job solving the numerous challenging tasks and situations and bringing the project over the finish line against all obstacles, in particular the difficult market environment. 

CEELM: What was the most challenging or frustrating part of the process? 

Christoph: Due to adverse market conditions, the transaction had to be pulled at the end of the initial offering period in November 2018. It wouldn’t have made sense to go to the market in a time where all investors tried to stay out of the markets. For some days, it looked like true turmoil in the market and nobody knew how the situation would evolve in December 2018 and early January 2019. In this situation, Erste Group, Herbst Kinsky, and we found a quite smart, never-before-tested way of keeping the prospectus “alive” by publishing a supplement and announcing that the transaction was aimed to be re-commenced in early 2019. Technically, the IPO was not stopped but only paused and we were able to convince the Austrian regulator of this new model. This was challenging but eventually a great success for the legal teams of Herbst Kinsky, Erste Group and Weber & Co.

Philipp: One of the most challenging and frustrating situation definitely was to learn that the market environment did not allow for the completion of the first attempt to close the transaction at the end of 2018, so that we had to postpone into January 2019. Another critical point was when Kempen made its last-minute decision not to proceed with the transaction. Quite frankly, there were certain points throughout the process where we had our doubts that the project would be successfully completed in the end. We were very glad and impressed to see how these situations could be solved with joined forces between the teams and a very solution-oriented, hard-working, and flexible approach by everybody. 

CEELM: What was Kempen’s involvement here? 

Philipp: Kempen & Co is a Dutch merchant bank providing financial services in securities broking, corporate finance and asset management. It has built a strong position as dedicated specialist player in the European Real Estate, Life Sciences & Healthcare and Financial Institutions & FinTech sectors. Kempen acted initially as Joint Global Coordinator and Bookrunner together with Erste Group Bank and, following suspension of transaction in 2018, decided not to proceed with the IPO. Erste Group Bank, therefore, became Sole Global Coordinator and Bookrunner of the IPO.  

CEELM: Was there any part of the process that was unusually or unexpectedly easy?

Christoph: Yes, the interaction with the involved persons. We never had a better team spirit, internally and externally, in IPO transactions. All involved parties, irrespective of their different views and interests, focused on the success of the transaction, did not engage in any game-playing or useless discussions. This was so unique and I will remember the special spirit among the group for the rest of my career. This was truly outstanding and unexpected as we all worked on transactions before were parties primarily focused only on their respective interests but not enough on the overall success of a transaction.

Philipp: Underwriting Agreement negotiations did not end up being too lengthy as Weber & Co., Marinomed Biotech, and we all had a very pragmatic approach to solving legal issues. Also the Comfort Letter discussions went quiet smoothly with BDO as a solution-oriented and very pragmatic partner.

CEELM: Did the final result match your initial mandate, or did it change somehow from what was initially anticipated? 

Christoph: Yes, it did, subject only to minor amendments structural-wise and the postponement of the IPO from beginning of December 2018 to beginning of February 2019.

Philipp: Disregarding the fact that things always turn out to be a little more demanding and time-consuming than initially expected and also mostly require certain adjustments of the intended structure and timing, the result finally matched our initial mandate.

CEELM: How successful was the IPO, ultimately?

Philipp: Given the difficult market environment in Q1/2019, the IPO was extremely successful with EUR 22.4 million in proceeds and stable stock price following the IPO (no stabilization measures were necessary within applicable post-IPO stabilization period). Since the first listing, Marinomed’s stock price has never fallen below issue price of EUR 75 per share.

CEELM: What specific individuals at Erste Group Bank AG and Goetzpartners Securities Ltd. directed your team’s work, and how did you interact with them?

Christoph: Our team worked very closely with the ECM team of Erste Group, which acted as lead manager and were the true stars on the banks’ side. They made the transaction happen, never lost faith, and pushed all involved parties to their limits in a positive way. The core ECM team of Erste Group included, among others, Guenther Artner, Markus Koller, Ignaz Bodenstorfer, Karin Heitzing-Daxbock, and Fabian Ketzler, but so many others as well, including the head Bernhard Leder, a great sales team and many more. In such a long process, you work together seamlessly, with numerous telephone calls, emails and meetings. And from my point of view the collaboration could not have been any better. 

CEELM: How about you, Philipp? What specific individuals directed your team’s work, and how did you interact with them?

Philipp: Throughout all phases and work streams of the IPO process, we received excellent support and instructions from both Marinomed’s top management team as well as all other team members and departments. It was impressive to experience how the relatively small management team at Marinomed was well-organized and efficient and interacted in very well-coordinated and professional manner with perfect allocation of responsibilities. 

For instance, when it comes to prospectus drafting, all scientific topics were excellently covered under the lead of CSO Eva Prieschl-Grassauer, all corporate and management topics by CEO Andreas Grassauer, and all financial and accounting topics by CFO Pascal Schmidt. It was impressive how fast Pascal Schmidt, who was appointed CFO during the transaction, became an integral part of the management team. The entire team had a focused, constructive, and solution-oriented approach, at all times remained calm and professional even in very difficult and stressful situations throughout the process, and proved to be highly responsive and available for our requests anytime with impressively short reaction times – even late at night, on weekends, and even during the periods of their time-consuming and stressful roadshow and other non-IPO related management duties.

CEELM: How would you describe the working relationship with Herbst Kinsky on the deal? 

Christoph: Honestly, the set-up with Herbst Kinsky working as issuer’s counsel and us working as banks’ counsel could not be any better from our point of view. There is a professional but extremely trusted relationship between the firms’ teams and in particular between Philipp Kinsky and myself, who headed the respective teams. A huge part of the legal success of the transaction is the result of this relationship as we did not waste any time discussing responsibilities but focused on getting things done. Philipp Kinsky is outstanding in this respect, has stunning know-how and experience but also finds amicable and problem-avoiding solutions all parties can live with. He is the go-to-guy for innovation companies aiming for capital markets in Austria. Therefore, I would say that irrespective of the way the communication was done there was a constant flow of smaller and larger negotiations, alignments, discussions, and development of solutions. In an IPO transaction there is usually no “final negotiation” but a constant flow of steps to be completed and this worked wonderful in this IPO matters.

Philipp: You may describe our work relationship with Weber & Co – and here especially with Christoph Moser – as a perfect match. Especially on sensitive matters like an IPO, it is crucial to have an experienced and super fit lawyer as bank´s counsel on the other side of the table. It is ideal if the negotiations are focused and based on a trustful relationship. Christoph Moser is an outstanding capital market lawyer, with immense expertise in this field. The communication was flawless, either e-mail, meetings or telcos, and Weber & Co’s team was always accessible. This attainability is very important since quick decisions are indispensable. We never had been at a potential dead end point; constant communication led us to constructive negotiations, which were resolved always very quickly. In particular, the content and release of ad-hoc announcements (being always very crucial) could be arranged and agreed with highly committed Christoph Moser within very short time frames, sometimes within minutes. 

CEELM: How would you describe the significance of the IPO to Austria? 

Christoph: Personally, I believe that the IPO of Marinomed Biotech is to be seen as an icebreaker transaction not only for Austrian biotech companies aiming for an IPO and a listing on a stock exchange but also for the Austrian capital market as such. After late 2017 there was not a single IPO in the market and for 2019 it did not look good either. Following the enormous success of the Marinomed IPO, there has now been a second attempt to go public in the market (Frequentis, which was listed in mid-May). The positive signal of the Marinomed IPO that companies can still go public in Vienna will further other issuers in conducting their ECM transactions. Erste Group Bank may also be able to establish a capital market focus for biotech companies after the successful IPO of Marinomed and I trust that other issuers will follow Marinomed’s path. The whole transaction is a perfect example of what Austrian innovative companies are about and how successful they can be even in a growth phase. And finally, I may admit that for Herbst Kinsky as counsel for other issuers and for our firm as one of the few true experts on the banks’ side in capital market transactions the IPO is truly an important marketing issue and will help both firms to continue playing a leading role in Austrian capital market matters.

Philipp: Since BAWAG, Marinomed was the first IPO in Austria; but it was also the first IPO in Europe in 2019; although the market environment was not supporting the transaction at all, we realized that all stake-holders, including the Austrian Financial Market Authority, Vienna Stock Exchange, the Commercial Court, and Austria-based investors were highly interested in getting this deal done. Marinomed was an enormous signal for other IPO candidates and investors that Austria is an interesting listing market. For Erste Bank the transaction was in particular important, as it showed their sales power, in particular in the DACH region and with biotech investors, a sector which Erste Bank has focused on for many years. For us it is a clear signal that we can assume senior roles in such transactions and advise on any exits of tech companies and that an IPO does not necessarily require a foreign lead counsel to execute the transaction. For Weber & Co. it is another milestone being one of the most reputable law firms in Capital Markets in Austria.

This Article was originally published in Issue 6.6 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.