Debt capital markets in Germany
Freshfields Bruckhaus Deringer
Freshfields Bruckhaus Deringer’s DCM practice works in close conjunction with its teams in Vienna and London and regularly handles instructions on complex products including hybrid and high-yield bonds alongside structured bonds and equity-linked bonds. Team head Christoph Gleske and Mark Strauch, who is known for his US legal expertise, advised ADO Properties on the structuring and issuance of a €400m debut bond, while Rick Van Aerssen assisted BASF with the structuring and issuance of a $600m bond with cash-settled warrants on the BASF share. The issuer CTC AcquiCO received assistance with German and US capital markets law matters pertaining to the financing of the acquisition of CeramTec by a consortium led by BC Partners; this included, among others, the issuance of 5.25% secured bonds with a total nominal value of €600m. In another highlight, the team advised the lenders and underwriters on the refinancing of Schmolz + Bickenbach Group amounting to €575m in the form of an adapted and revised syndicated credit line of the group totalling €375m and the issuance of secured bonds valued at €200m due in 2022.
The strength of Hengeler Mueller’s ‘very good’ DCM practice lies in advising on the issuance of bonds and issuance programmes, leading to regular instructions on the issuance, restructuring and transaction of classic tier 1 and tier 2 notes and hybrid instruments. The ‘clever’ Dirk Bliesener acted as lead counsel when advising Bayerische Landesbank on the structuring and documentation of new debt products for the issuance of the Krügerrand Gold bond comprising 250,000 securities, while Johannes Tieves assisted the parent company of Brenntag Group with the issuance of a €600m bond. Also acting as lead counsel, Hendrik Haag advised a banking consortium led by Credit Suisse, Deutsche Bank and BNP Paribas on the issuance of eurobonds from Deutsche Telekom International Finance, the Dutch financing arm of Deutsche Telekom, in three tranches and with a total value of €3.5bn. He also advised innogy on the issuance of the first green bond totalling €850m, and assisted Schmolz + Bickenbach with the refinancing and restructuring of a €650m financing by issuing a €200m high-yield bond. In November 2018, Andreas Lischka joined White & Case LLP as local partner.
Linklaters covers a wide range of matters pertaining to bonds and structured products and frequently acts in co-operation with its capital markets and corporate teams. Peter Waltz, who is noted for his ‘extensive regulatory experience’, advised Raiffeisen Bank International on the issuance of additional tier 1 notes totalling €500m, and, together with Alexander Schlee, who was promoted to the partnership in May 2018, he assisted a banking consortium with the issuance of a convertible bond valued at €1bn including conversion rights into Deutsche Post shares. In another significant matter, the duo advised a consortium on the issuance of two hybrid bonds by Volkswagen Group: these subordinated bonds totalled €1.5bn and €2bn respectively, each without a fixed term but including an interest rate reset. In conjunction with colleagues from the corporate, M&A and tax departments, the team also acted for Bayer on the issuance of exchangeable bonds valued at €1bn and on the placement of Covestro shares for €17.25m. Kurt Dittrich heads the team. Other clients include Dream Global Funding and J.P. Morgan Securities.
Allen & Overy LLP
Providing ‘excellent and speedy advice’ based on ‘in-depth industry knowledge’, Allen & Overy LLP regularly advises issuers and issuing banks on the launch and updating of issuance programmes, the issuance of corporate bonds, pfandbriefe and other collateralised bonds as well as structured bonds, equity and hybrid instruments, high-yield bonds and registered bonds, while also handling bond repurchases. Together with the firm’s corporate practice, Christoph Enderstein advised alstria office REIT on the issuance of an unsecured, fixed-income corporate bond valued at €350m alongside the concurrent tender offer for two existing bonds from alstria, while, together with Knut Sauer and Marc Plepelits, he assisted Corestate Capital Holding with the placement of promissory notes worth €300m. IKB Deutsche Industriebank received advice on the issuance of a tier 2 subordinated bond amounting to €300m, and UBS instructed the team to assist with matters pertaining to various structured securities. Martin Scharnke is also noted and Christian Klöpfer was appointed counsel in October 2017.
The team at Clifford Chance provides ‘a very high service level’, frequently assisting clients, including banks and well-known companies, with standalone bonds and issuance programmes alongside liability management transactions and high-yield bonds. In recent work, the team advised Volkswagen and Volkswagen Finance on the issuance of a hybrid bond worth €3.5bn consisting of two tranches, assisted BNP Paribas and UBS Investment Bank with alstria office REIT’s capital measures, and acted for HSBC Bank, the bookrunner, on the issuance of a bond by AT & S Austria Technologie & Systemtechnik. In other significant work, ‘very experienced’ team head Sebastian Maerker, who is also noted for his ‘client-oriented approach’, assisted a banking consortium including, among others, J.P. Morgan, Barclays, HSBC and ING, with the issuance of a bond by SAP, and advised Surteco on the issuance of promissory loans totalling over €200m. Merrill Lynch International, Landesbank Hessen-Thüringen and Citigroup Global Markets are also clients.
Latham & Watkins LLP’s integrated capital markets and banking practice assists issuers and banks with the issuance of investment grade and high-yield bonds; the latter constitutes a particular area of strength for the practice, while it also handles bank bonds in Germany, other European countries and the US. Alexander Lentz and team head Rüdiger Malaun jointly advised Demire Deutsche Mittelstand Real Estate on the first issuance and subsequent tap offering of senior notes under New York law totalling €400m and maturing in 2022, and assisted a banking consortium led by Morgan Stanley with the issuance of two tranches of senior notes by Consolidated Energy Finance, the financial vehicle of a Swiss-based methanol and fertiliser company, amounting to $800m. Another banking consortium including Barclays, Deutsche Bank and Citigroup received assistance with a bridge-to-bond financing in connection with the public takeover of Stada by the financial investors Bain Capital and Cinven, while BayWa instructed the team to advise on the issuance of a €300m subordinated high-yield bond. Frankfurt-based Gregory Walker was appointed counsel in January 2018.
The ‘very committed, pragmatic and solution-oriented’ DCM team at White & Case LLP is ‘very responsive’ and ‘even handles short-term enquiries quickly’, while clients also benefit from its ‘good market knowledge’. This is frequently drawn upon when handling issuance programmes and standalone bonds as well as high-yield bonds, equity-linked transactions, hybrid products and regulatory matters. The ‘very reliable’ Rebecca Emory, who is ‘always available, handling every matter with outstanding quality and high speed and is highly skilled at guiding clients through transactions’, and Gernot Wagner are the main contacts for high-yield bond work. Recently, Emory and Wagner advised a banking syndicate led by BNP Paribas, HSBC, J.P. Morgan and UniCredit on the €275m high-yield bond issuance by Nordex. The ‘very experienced and reliable’ Jochen Artzinger-Bolten, who is also ‘pleasant to work with’, assisted Citigroup with the promissory note by Sherwin-Williams amounting to €245m, while Karsten Wöckener advised real estate developer Consus Real Estate on the issuance of its first promissory note worth €200m. Clients praise Wöckener for his ‘commercial understanding’ and ‘pragmatic and practical solutions’, while his ‘extensive experience enables him to understand both sides of a transaction very well, giving him a mediating effect without losing credibility’. Cristina Freudenberger made local partner in January 2018 and Andreas Lischka joined as local partner from Hengeler Mueller in November 2018.
Gleiss Lutz stands out for its ‘very high level of service and high-quality work’. The ‘very good’ team is ‘always available and reliable’ and also has ‘a good business sense’, which is routinely drawn upon when advising on high-yield bonds and investment grade bonds. The ‘very experienced and always approachable’ Kai Arne Birke, who is ‘well versed in bond restructuring work’ and noted as working in ‘a cost-efficient way’, advised J.P. Morgan, Citigroup and Deutsche Bank on the issuance of a high-yield bond by Neptune Energy, and assisted J.P. Morgan with the issuance of a high-yield bond by Safari Holding. He also acted for Steinhoff Europe on the issuance of a corporate bond amounting to €800m, and advised the shareholders of Annex Capital Invest on the restructuring of a bond issued by Smart Solutions. Stephan Aubel is noted for his ‘focus on the essentials coupled with excellent legal expertise’, while also receiving praise for his ‘sharp analysis and strong communication skills’.
Hogan Lovells International LLP’s broad client base predominately consists of international investment banks as well as German and European financial institutions, which routinely retain the team to advise on various national and international capital markets transactions with particular focus on bonds, pfandbriefe and promissory notes alongside emission programmes, liability management and bond restructuring matters. Jochen Seitz advised Commerzbank on the update of Deutsche Pfandbriefbank’s debt issuance programme, and, in a similar matter, assisted UniCredit Bank with the update of the issuance programmes of Volkswagen Financial Services and Volkswagen Bank, while he acted for a banking consortium on the placement of mortgage bonds by Deutsche Pfandbriefbank totalling €500m. In other work, Michael Schlitt advised Deutsche Bank on SLM Solutions Group’s convertible bond offering worth €58.5m, and, together with the banking team, he assisted Norddeutsche Landesbank Girozentrale with the inaugural issue of promissory notes to the International Investment Bank. Sina Hekmat is the main contact for US law matters; he divides his time between New York and Frankfurt and assists issuers and intermediaries with government bonds, investment grade and high-yield bonds under US law. Sven Brandt heads the team.
Mayer Brown LLP
Mayer Brown LLP demonstrates ‘a deep understanding of the market and the client’s situation’, leading to ‘well-balanced advice, which highlights the risks but also aims for pragmatic solutions’. Benefiting from ‘a good co-operation with the firm’s global network’, the team advises on bonds, pfandbriefe and promissory notes alongside liability management and bond restructuring, while handling work on structured financing products and OTC derivatives constitutes another key element. Together with its Hong Kong office, Patrick Scholl advised a banking consortium of joint lead managers on the first issuance of euro bonds, by Chinese company Chengdu Xingcheng Investment Group, listed and traded on the regulated market of the Frankfurt Stock Exchange and available for trading in the China Europe International Exchange; the dual-tranche offering amounting to €365m and €135m respectively was placed with institutional investors. In another matter, he assisted DekaBank Deutsche Girozentrale with the update of the base prospectus regarding the Retail Structures Notes Platform I and II. Deutsche Derivate Verband (DDV) and HSH Nordbank are also clients.
Sullivan & Cromwell LLP
Sullivan & Cromwell LLP advises issuers and underwriters on various German and US law matters and is considered a good contact for clients that require assistance with US SEC-registered issuances under Rule 144C of the Securities Act. Advising on equity-linked bonds and high-yield bonds constitutes another key element of the practice. In co-operation with other offices, the team advised Bank of America Merrill Lynch and Deutsche Bank as initial purchasers on an offering of high-yield bonds by Tele Columbus, issued in connection with Tele Columbus’ partial refinancing of a syndicated credit line. Carsten Berrar and Konstantin Technau assisted Deutsche Wohnen with capital measures amounting to €1.8bn; these measures comprised of private placements in accelerated bookbuild offerings with institutional investors of approximately 17.1 million newly issued shares in the aggregate amount of €545m as well as convertible bonds with a nominal amount of €800m and a conversion premium of 53% above the placement price of the concurrent share placement. FMS Wertmanagement receives regular assistance from Krystian Czerniecki with SEC-registered bond issuances. Max Birke and managing partner Wolfgang Feuring are other key members of the team.
Ashurst LLP puts significant emphasis on OTC derivatives and securitised derivatives, with a focus on structured retail products, alongside promissory notes, warranty bonds and convertible bonds. Team head Tobias Krug advised Patrimonium on the issuance of approximately ten secured bonds subscribed by Patrimonium Middle Market Debt Fund, and assisted DIC Asset with the placement of two corporate bonds listed on the Official List of the Luxembourg Stock Exchange. He also acted for Jefferies International on the issuance of promissory notes and registered bonds. With the arrival of a three-strong team around Martin Kaiser from Baker McKenzie in August 2017, the team boosted its securitisation capabilities.
Cleary Gottlieb Steen & Hamilton
Benefiting from its combined German and US law expertise, Cleary Gottlieb Steen & Hamilton’s client portfolio includes issuers and underwriting banks, which routinely instruct the team to advise on the issuance of bonds, pfandbriefe and MTN programmes alongside convertible, exchangeable and regular bonds but the team also handles derivatives. Recently, Ward Greenberg advised Deutsche Bank on an exchange offer for outstanding Rule 144A bonds valued at up to $4.5bn to be exchanged for SEC-registered bonds with a corresponding principal amount and a concurrent cash settlement offer for the purchase of Rule 144A bonds amounting to $1bn, and, in a different matter, he acted for the same client on the issuance of tier 2 debt securities worth $1bn. Gabriele Apfelbacher assisted several clients, including Aareal Bank, Bayerische Landesbank and BW Capital Markets, with matters pertaining to the repayment of trust preferred securities. Thomas Kopp and counsel Manuel Metzner are other key individuals in the team.
At CMS, the DCM practice regularly handles corporate bonds, registered bonds, promissory notes as well as commercial paper programmes and EMTN programmes. Team head Oliver Dreher advised a banking consortium as joint lead manager on the placement of a benchmark bond by hsh finanzfonds AöR amounting to over €750m, and, together with ECM expert Philipp Melzer, he assisted Telefónica Germany with the placement of promissory notes and registered bonds. In other work, Dreher advised the underwriting banks Bayerische Landesbank, Commerzbank and Deutsche Bank as joint lead managers on Sixt’s placement of bonds worth €250m with domestic and foreign investors, and acted for a consortium led by Commerzbank on the renewal and increase of Continental’s commercial paper programme with a new maximum value of €1.5bn. Dr. Ing. h.c. F. Porsche received advice on the issuance of promissory notes worth €280m.
Skadden, Arps, Slate, Meagher & Flom LLP
The team at Skadden, Arps, Slate, Meagher & Flom LLP consists of lawyers qualified in Germany and the US, leading to particular expertise in handling cross-border transactions and most notably those with US law elements but the team is also well versed in equity-linked bonds and high-yield bonds as well as refinancing matters. Katja Kaulamo advised a US investor on a proposed investment in convertible bonds, and acted for a manufacturer of electrical components and equipment on the issuance of convertible bonds, while team head Stephan Hutter assisted an Austrian state with the restructuring of a distressed investment. Together, they also advised the joint bookrunners J.P. Morgan Securities and Deutsche Bank on matters pertaining to the placement of a fixed-income corporate bond by TLG Immobilien totalling €400m. Serengeti Asset Management is another client.