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- Capital markets: high-yield debt offerings - advice to issuers
- Capital markets: high-yield debt offerings - advice to underwriters
- Leading lawyers
Capital markets: high-yield debt offerings - advice to issuers
Capital markets: high-yield debt offerings - advice to underwriters
- Craig Arcella - Cravath, Swaine & Moore LLP
- James Clark - Cahill Gordon & Reindel LLP
- Marc Jaffe - Latham & Watkins LLP
Michael Kaplan -
Davis Polk & Wardwell LLP
- Joshua Korff - Kirkland & Ellis LLP
- David Lopez - Cleary Gottlieb Steen & Hamilton LLP
Arthur Robinson -
Simpson Thacher & Bartlett LLP
- Jonathan Schaffzin - Cahill Gordon & Reindel LLP
When it comes to advice to underwriters, the level of service at Cahill Gordon & Reindel LLP, particularly in relation to high-yield securities, ‘is second to none’. Clients appreciate the ‘very deep roster of qualified attorneys who have unparalleled market knowledge regarding high-yield financing’, adding ‘the partners are extremely responsive and balance underwriter protections with commercial knowledge extremely well’. Earning individual praise is John Tripodoro, whose ‘mind is like an encyclopaedia of precedents’. Among the matters Tripodoro worked on in 2015 was advising the financing sources on $16bn worth of bank, bond and equity financing related Valeant’s acquisition of Salix; the other attorneys leading on this were William Hartnett, Noah Newitz and Timothy Howell. The 29-partner group also includes key names such as Daniel Zubkoff and Douglas Horowitz, who, among other things, assisted the initial purchasers with a $6.6bn Rule 144A/Regulation S placement related to Frontier Communications’ purchase of wireline assets from Verizon. Other names to note are James Clark, Jonathan Schaffzin, Michael Ohler and Corey Wright.
In relation to the high-yield market, Kirkland & Ellis LLP has one of the most active practices in the country. The firm acts almost exclusively as issuer’s counsel to private equity sponsors and their portfolio businesses as well as public companies, often in relation to M&A financing. Notable recent work includes Joshua Korff advising Heinz on its $2bn offering of second lien senior secured notes, the proceeds of which were used to fund its merger with Kraft Foods. During 2014 and 2015, Christian Nagler advised on numerous high-yield debt issuances, including two offerings by Charter Communications totaling $6.2bn and a $1.26bn offering by Murray Energy. Korff and Nagler are both based in New York, but the firm has notable strength in its Chicago office too. From there, James Rowe acted for iHeart Communications in a $950m notes offering and Dennis Myers handled asset management software provider Solera Holdings’ $850m notes offering. New York-based Richard Aftanas is another key name in this space.
Latham & Watkins LLP has an impressive profile in the high-yield space and successfully balances a leading issuer side practice with a very strong showing on the underwriter side. In the period under review, the firm handled $92bn worth of high-yield offerings, among which are standout matters such as advising the underwriters in relation to American Energy - Permian Basin’s $295m offering of senior secured second lien notes. Houston-based Michael Chambers and Chicago-based Roderick Branch led on that matter, which was one of only a handful of such deals done in the energy space in 2015. Out of Washington DC, practice co-chair Patrick Shannon assisted Cogent Communications with its issuance of $250m of notes, and out of New York, co-chair Marc Jaffe and Erika Weinberg acted for Intrepid Aviation in its $120m notes offering. Other key contacts are Jason Licht in Washington DC as well as Kirk Davenport and Ian Schuman in New York.
Private equity powerhouse Simpson Thacher & Bartlett LLP is ‘top-notch in terms of its knowledge of current markets and emerging trends’, and in the high-yield space, particularly on behalf of issuers, it is among the very best. Heading the practice is New York-based Arthur Robinson, and of his team clients say that the ‘experience, industry knowledge and business acumen are particularly impressive’ and that these are ‘extremely helpful in guiding us through the offering process’. Recent work includes Edgar Lewandowski and Edward Tolley advising Summit Materials on a $300m Rule 144A/Regulation S offering, Joseph Kaufman assisting non-governmental hospital operator HCA with its $1.6bn notes offering and Andrew Keller acting for Sirius XM Holdings on a $1bn offering by its subsidiary Sirius XM Radio. In an example of the firm’s work on the underwriter side, where it is also strong, a team led by Robinson and Ryan Bekkerus advised the initial purchasers on a $1.2bn offering by Pharmaceutical Product Development. Other names to note are Kenneth Wallach and Richard Fenyes, who is commended for his ‘subject matter command and ability to think outside the box’.
Cleary Gottlieb Steen & Hamilton LLP is well known for its quality in handling complex capital markets transactions, and in the high-yield arena it is an attractive option for issuers as well as for underwriters and initial purchasers. Key names in this practice - which is closely tied to the firm’s private equity, acquisition finance and M&A practices - include Craig Brod and Michael Volkovitsch. In a highlight from 2015, Francesca Odell advised longstanding client Petrobras on what was the first-ever ‘century bond’ offering by a Brazilian issuer - $2.5bn of senior notes due in 2115. Elsewhere, Brod acted for Canadian company OpenText in an $800m Rule 144A/Regulation S offering, and David Lopez assisted Warburg Pincus and Sterigenics-Nordion Holdings with Sterigenics-Nordion’s $450m notes offering, the proceeds of which were used to finance the Warburg Pincus-sponsored purchase of a majority stake in Sterigenics. Duane McLaughlin, Pamela Marcogliese and counsel David Webb are also recommended.
Cravath, Swaine & Moore LLP is hailed as ‘the best on all fronts when it comes to financing transactions’. Praised for its ‘expertise, work ethic, planning, execution and deep bench’, the team provides a level of service that is ‘unmatched’. In the high-yield space, the firm is impressive in managing to balance high-level practices on both the issuer and underwriter sides. In 2015, on the issuer side, the firm advised on Rule 144A/Regulation S offerings for, among others, Vista Outdoor, Cable One, and subsidiaries of CyrusOne. Assisting Vista was Craig Arcella, who earns praise for demonstrating ‘a unique balance of sophistication and creativity when it comes to financial transactions’. Joseph Zavaglia and Kris Heinzelman* acted for Cable One, and William Fogg advised the CyrusOne subsidiaries. On the underwriter side, Andrew Pitts and Joseph Zavaglia handled on behalf of the initial purchasers Rite Aid’s $1.8bn Rule 144A/Regulation S offering while Fogg and Johnny Skumpija advised the underwriters on United Rentals’ $1.8bn registered offering. William Whelan is another name to note. *Since publication, Kris Heinzelman has retired from the firm's corporate department.
Davis Polk & Wardwell LLP is globally renowned for its expertise in securities law and is routinely among the most active across product types. In the high-yield arena, as elsewhere, the firm has a balanced practice, advising issuers and underwriters across a wide range of industries. Standout matters included acting for the joint book-running managers, initial purchasers and global coordinators on a series of Rule 144A/Regulation S offerings totaling $3.1bn by freight transportation provider XPO Logistics; Michael Kaplan led on that. Kaplan also handled certain financing transactions related to Windstream Services’ spin-off of its communication distribution systems, acting for the initial purchasers in relation to a $1.5bn Rule 144A/Regulation S offering and the dealer managers in relation to a debt-for-debt exchange. Elsewhere, Menlo Park-based Alan Denenberg assisted data exchange company Equinix with a $1.1bn notes offering to finance M&A activities while Richard Truesdell advised MSCI, a provider of investment support tools, on an $800m Rule 144A/Regulation S offering.
The ‘very strong group’ at Paul, Weiss, Rifkind, Wharton & Garrison LLP is particularly prominent in issuer-side representations in the high-yield space, which is largely a function of its sizeable private equity practice. Highlights in 2015 included Gregory Ezring and David Huntington handling chemical manufacturer Hexion’s $315m offering, Lawrence Wee advising broadband company WaveDivision on a $125m offering and Raphael Russo assisting consumer products Spectrum Brands with a $1bn notes offering. During the course of 2015, Russo also acted as issuer’s counsel in a series of offerings by HRG Holdings totaling $400m. Monica Thurmond and John Kennedy are additional key contacts.
Shearman & Sterling LLP provides ‘excellent service’, handling ‘all level of transactions from the smallest to the largest with expertise’. Key partners in the high-yield space include Michael Benjamin and Jonathan DeSantis in New York and Jason Lehner, who splits his time between New York and Toronto. Among the high-yield deals the ‘absolutely top-notch’ Benjamin acted on in 2015 were Rule 144A/Regulation S offerings by Air Medical ($370m) and also Dean Foods ($700m); in both cases Benjamin represented the underwriters. On the issuer side, Lehner, at the back end of 2014, advised KLX on a Rule 144A/Regulation S offering related to its spin-off from B/E Aerospace. Lehner also served as underwriters’ counsel in offerings by Dana Holding Corporation, Cott Beverages and Peabody Energy. Elsewhere, DeSantis assisted sole book-running manager Wells Fargo Securities with a $350m Rule 144A/Regulation S offering of floating rate notes by FTS International.
Skadden, Arps, Slate, Meagher & Flom LLP has a strong showing in the high-yield debt space, particularly as counsel to issuers but also to underwriters. Standout matters for the team in 2015 include Michael Zeidel advising Valeant on two Rule 144A/Regulation S notes offerings of $10.1bn and $1bn respectively; the first transaction was the second largest high-yield notes offering ever. Another key figure in the group is Stacy Kanter, who in 2015 assisted DuPont with a $2.5bn offering by its subsidiary Chemours. Elsewhere, Gregory Fernicola acted for CEMEX in two Rule 144A/Regulation S offerings of €550m and $750m respectively. On the bank side, David Goldschmidt advised the representatives of the underwriters on a €500m notes offering by MPT Operating Partnership, the operating Medical Properties Trust. All named attorneys are based in New York.
Sullivan & Cromwell LLP’s practice in the high-yield arena is weighted towards the issuer side, but it certainly has a presence on the bank side too. Recent examples include Robert Downes advising the initial purchasers on a $600m Rule 144A/Regulation S notes offering by PPL Energy Supply and Robert Buckholz acting for the joint book-running managers on a $300m registered offering by electronic security company ADT. The firm has specific industry knowledge in, among other areas, energy, mining, healthcare and industrial goods, which is evident in some of its recent issuer-side engagements, such as assisting Concordia Healthcare with a $735m Rule 144A/Regulation S offering to part finance its acquisition of the commercial assets of Covis Pharma. John Estes played a key role in that, as he did in the advice to Fortescue Metals in a balance sheet restructuring involving a $2.3bn Rule 144A/Regulation S offering. Palo Alto-based John Savva is another name to note; he handled CNH Industrial Capital’s $600m Rule 144A/Regulation S offering.
Weil, Gotshal & Manges LLP has an active high-yield practice that often works closely with the firm’s banking and finance, M&A and private equity teams in relation to acquisition finance. As an example, a team led by Todd Chandler advised new client WPX Energy on its $1bn offering of high-yield notes to part finance its acquisition of RKI Exploration & Production. In another example, a team led by Heather Emmel acted for Kronos Acquisition Holdings, the parent company of KIK Custom Products, in its $390m notes offering to part finance its acquisition by Centerbridge. Elsewhere, the recommended Corey Chivers handled AMC Entertainment’s $600m notes offering to finance its $600m tender offer for certain other notes. Alexander Lynch heads the capital markets practice.
Baker Botts L.L.P. worked on numerous high-yield debt offerings over the course of 2015, both as issuer’s counsel and as underwriters’ counsel, and typically in matters involving energy companies. Examples included Kelly Rose, Douglass Rayburn and Mollie Duckworth advising LINN Energy on an agreement with noteholders to exchange $2bn worth of its outstanding senior unsecured notes for $1bn of newly issued senior secured second lien notes. Rose and David Kirkland head the firm’s corporate department out of Houston; Rayburn is based in Dallas and Duckworth in Austin. Other work of note included John Geddes handling Noble Corporation’s $1.1bn offering by its subsidiary Noble Holding and Tull Florey acting for the initial purchasers on an $800m private placement by Gulfstream Natural Gas System. Florey and Geddes are based in Houston, as is Joshua Davidson, who is another notable name.
The ‘terrific’ capital markets team at Debevoise & Plimpton LLP ‘brings great judgment’ to its advice to clients, which in the high-yield space are typically issuers. Highlights from 2015 included Steven Slutzky handling metal products manufacturer NCI Building Systems’ $250m notes offering, the proceeds of which were used to fund its $245m acquisition of CENTRIA. Slutzky heads the practice alongside Matthew Kaplan, who assisted Corporate Risk Holdings restructure around $1.8bn of indebtedness, including three separate exchange offers requiring the issuance of $540m in new second and third lien high-yield notes. Another name to note is Peter Loughran, who acted for Tribune Media in several securities transactions, including its $1.1bn notes offering.
Fried, Frank, Harris, Shriver & Jacobson LLP’s capital markets team gets ‘very high marks for strength-in-depth’ and for the fact that its lawyers ‘know the subject matter law very well and consistently factor in circumstances and business goals in providing advice’. The team is led by Daniel Bursky and Stuart Gelfond, and in the high-yield arena it provides a balanced practice acting for issuers and underwriters. In a recent highlight, Bursky and Joshua Coleman assisted the initial purchasers with a €675m high-yield notes offering by SIG Combibloc. Elsewhere, Gelfond handled ONEOK’s $500m registered notes offering and Gelfond teamed up with Mark Hayek to advise the initial purchasers on a $200m offering by Speedway Motorsports. Andrew Barkan is also recommended.
The ‘excellent’ team at Jones Day is praised for its ‘responsiveness, expertise and practice advice-giving’ and for being ‘a very valuable resource in the high-yield debt area’. The ‘extremely knowledgeable and very responsive’ Michael Solecki heads the US practice alongside Christopher Kelly; both are based in the Cleveland office, but the firm has capital markets experts stationed right across its US and international network. Highlights in 2015 included advising communications services company Sprint on its public offering of $1.5bn of notes and acting for USG Corporation, a manufacturer and distributor of building materials, on its $350m Rule 144A/Regulation S offering and concurrent tender offer for outstanding notes. New York-based Eric Maki and Cleveland-based Kimberly Pustulka led on the first matter; Edward Winslow and Timothy Melton led on the second out of Chicago.
Milbank, Tweed, Hadley & McCloy LLP’s team is valued for having ‘extensive experience handling some of the most nuanced and difficult issues presented by capital markets transactions’. In the high-yield space, as elsewhere, its financing work is often tied to acquisitions or to liability management issues. As an example, the firm acted for the banks in a $579m financing package for Nord Anglia Education to fund its acquisition of six schools; Rod Miller played a key role in this matter, which included a CHF200m Rule 144A/Regulation S offering of senior secured high-yield notes. Elsewhere, Arnold Peinado played a key role advising the initial purchasers in a $300m offering by VistaJet. Marcelo Mottesi heads the capital markets practice; Paul Denaro is another name to note.
Paul Hastings LLP has built up a significant capital markets practice in recent years, and the team was further boosted in 2015 by the arrival of Cathleen McLaughlin from Allen & Overy LLP. McLaughlin is a Latin America expert, which adds to the firm’s notable strength in that area. Recent work in the high-yield space includes John Cobb advising Barclays and RBC Capital Markets as initial purchasers in connection with a $375m Rule 144A/Regulation S offering by Reliance Intermediate Holdings and assisting Barclays as dealer manager with a concurrent tender offer by Reliance for outstanding notes. Additionally, Michael Fitzgerald and Joy Gallup acted for the underwriters in Televisa’s $1.2bn senior notes issuance, the biggest Mexican corporate bond offering of 2015. The group is chaired by Michael Zuppone who is based in New York along with all other named lawyers.
The team at Proskauer Rose LLP has ‘a deep knowledge base’ and is ‘always available, highly responsive and easy to work with’. The ‘terrific’ Frank Lopez is a specialist in this area and heads the capital markets alongside Julie Allen. In 2015, among other things, Lopez advised, with Maximilian Kirchner, Suburban Propane Partners and Suburban Energy Finance on a $250m senior notes offering. He also acted for Beach Point Capital Management as purchaser in a tack-on placement of high-yield notes by logistics company Neovia. In another notable matter, Carlos Martinez handled Pacific Rubiales Energy’s $750m Rule 144A/Regulation S offering, the proceeds of which were used to finance shorter term debts.
In 2015, Vinson & Elkins LLP’s capital markets team handled a considerable volume of high-yield transactions for issuers and underwriters. Highlights included Mark Kelly and Sarah Morgan advising Energy XXI Gulf Coast on its $1.45bn private offering of senior secured second lien notes, the proceeds of which were used to repay outstanding debt and fund a portion of its 2015 capital expenditure. Also in 2015, David Stone assisted SandRidge Energy with its $1.25bn offering of senior secured notes, and acted for the underwriters in Halcón Resources’ $700m senior notes offering and a subsequent $1bn debt exchange offer for its outstanding senior notes. Michael Harrington is also singled out for recognition. All named attorneys are based in Houston.
As a leader in institutional lending, White & Case LLP has strong relationships with many of the top investment banks. Over the course of 2015, the firm has advised the underwriters, initial purchasers and joint book-running managers on numerous high-yield offerings. As an example, a team led by leveraged finance specialist Ronald Brody acted for Jefferies as sole representative of the joint book-running managers in DAE Aviation Holdings’ $485m notes offering, the proceeds of which were used to part finance the purchase of its parent company by VCSA Holding Corp. Gary Kashar, another key figure, assisted the initial purchasers, including Morgan Stanley, with Walter Energy’s $320m notes offering. The proceeds from this were used to repay all outstanding debts.
Clifford Chance’s US capital markets practice is led out of New York by Gary Brooks. The four-partner team does not handle the volume of deals as evidenced elsewhere, but focuses instead on sophisticated cross-border work involving foreign issuers, particularly from Latin American. Examples from 2015 included Brooks advising LATAM Airlines on its first issuance of high-yield notes (a $500m Rule 144A/Regulation S offering) and a related tender offer for $300m of notes of TAM Capital 2 (part of LATAM). Elsewhere, Alex Camacho acted for managing underwriters Goldman Sachs and Santander in Mexican company Gruma’s $300m Rule 144A/Regulation S offering while Jonathan Zonis handled electricity company AES Panama’s $300m notes offering.
Dechert LLP earns praise for its ‘excellent service and speedy response times’ and, according to one client, for ‘getting up-to-speed with our business quickly’. It is noted for its work with private equity firms and emerging companies, and has a particularly strong profile within the life sciences and pharmaceuticals sector. In the high-yield space, a team led by New York-based David Rosenthal recently advised Egalet on a $60m Rule 144A/Regulation S private placement. Rosenthal chairs the practice alongside Boston-based Thomas Friedmann; other notable names are Howard Kleinman and Richard Goldberg in New York and William Lawlor and Ian Hartman in Philadelphia. Goldberg is commended for his ‘excellent responsiveness and commanding subject-matter knowledge’.
Gibson, Dunn & Crutcher LLP’s capital markets practice is led by Andrew Fabens, Stewart McDowell and Peter Wardle, who are based in New York, San Francisco and Los Angeles respectively. In the high-yield space, recent highlights include New York-based Barbara Becker advising Tenet Healthcare on a $2.8bn Rule 144A offering and concurrent Canadian private offering of floating rate notes, the proceeds of which were used, in part, to fund its acquisition of European Surgical Partners. Century City-based Cromwell Montgomery handled Shea Home Limited Partnership’s $750m Rule 144A offering while Denver-based Steven Talley assisted Zayo Group with a series of high-yield offerings totaling $1.78bn.
Mayer Brown continues to act on high-yield deals for issuers and, to a lesser extent, underwriters. Highlights from 2015 included Paul Theiss and John Berkery advising Isle of Capri Casinos on its offer to exchange $150m of notes issued in a private offering with $150m of registered notes, and Harry Beaudry, Bill Hart and William Heller handling Halcón Resources’ $700m high-yield notes. On the underwriter side, Douglas Doetsch and Gabriela Sakamoto advised the underwriters, including Nomura Securities International, on ACI Airport SudAmerica’s $200m high-yield notes offering, and Berkery and practice head Edward Best acted for Bank of America Merrill Lynch in Oshkosh Corporation’s $250m notes offering. Best, Theiss, Beaudry and Doetsch are based in Chicago, Berkery is located in New York, and Heller works out of Houston.
Ropes & Gray LLP provides a ‘very high level of service’ in relation to high-yield debt offerings. Much of its work in this space stems from its numerous private equity relationships, and in particular from leveraged buyouts and recapitalization and refinancing transactions. A notable highlight from 2015 included New York-based Jay Kim assisting Party City with the complete refinancing of its capital structure, which included a $350m offering of senior unsecured high-yield notes. The firm also acted for TPG, Bain Capital, Blackstone and American Industrial Partners in acquisition-related high-yield offerings by respective portfolio companies. Boston-based Byung Choi and Jason Serlenga and New York-based Stefanie Birkmann are other names to note.