Partner | Latham & Watkins LLP
Veronica Relea
Partner | Latham & Watkins LLP
15
Project Finance, Banking, Latin America, and Private Equity Finance
New York
Spanish, English, French, Portuguese
Veronica Relea’s practice focuses on representing commercial and investment banks, sponsors, developers, and private equity firms in connection with the development, construction, operation, and financing of energy, oil and gas, and infrastructure projects. She also has extensive experience in leveraged finance transactions, including acquisition financings, asset-based facilities, private equity transactions, mezzanine facilities, and cross-border financings.
As a native from San Juan, Puerto Rico, Relea’s solid ties to the region, and her deep understanding of local practices, have allowed her to offer clients comprehensive professional services leading to successful investments in the Latin American region.
She has developed a robust US and Latin America practice (with a significant portion of it consisting of Mexico transactions), advising clients on a range of complex finance transactions. Her seasoned guidance on banking and finance matters has earned recognition from Latinvex as one of Latin America’s top 100 female lawyers.
The practice is representing Credit Suisse who is arranging and acting as administrative agent in connection with Mexican peso credit facilities for a privately-owned paper packaging company in Mexico. They are also currently advising Selina in connection with the development and financing of hospitality properties in several countries, including Mexico. Other work highlights over the last year include advising IFM Global Infrastructure Fund in a follow-on incremental facility after completion of its acquisition of OHL Concesiones, a Spanish infrastructure company engaged in the development, operations and management of toll roads, ports, railways, airports and concessions throughout Spain, Colombia, Peru, Chile and Mexico, and its joint tender offer for OHL Mexico.
Although the legal and regulatory regimes in Mexico differ in many respects from those in the United States, we are seeing more and more transactions in Latin America that mirror developing and complex structures used in US transactions. It is imperative that we offer our clients the knowledge and expertise that come from the latest technology that can be applied in both the US and Mexican markets.
In addition, as we’ve seen from recent M&A activity in Mexico, many Mexican investors have been reducing their Mexico exposure and/or taking advantage of opportunities abroad, and foreign investors with a certain risk appetite are being attracted by the potentially higher returns from relatively discounted Mexican assets. If this trend continues, foreign private investors (including US investors) will likely play an increasingly important role in providing debt and equity financing for projects in Mexico. Advising Mexico-based clients from an office in the United States allows one to bring to the table a huge network of potential investors as well as a deep understanding of US investor concerns, both of which contribute significantly to the successful execution of a finance transaction.
Mexico’s new president’s uncertain economic policy (including the cancellation of infrastructure projects, an unprecedented cut in public expenditure, and the suspension of energy contract auctions for three years) has resulted in lower investment and diminished business confidence, thereby slowing Mexico’s economic growth outlook. That said, consumption remains strong (largely supported by positive consumer sentiment) and I would expect consumption to drive growth at a slow but steady pace. I would expect that uncertainty surrounding international trade and the world economy will be less significant in the months to come, and that a recovery in private investment will likely follow (though investors will likely demand a higher risk premium to remain in Mexico). A ratification of the USMCA, coupled with continued trade tensions between the US and China, should also help reduce uncertainty regarding trade between the US and Mexico and the United States.
I would expect US and other foreign investors to continue to pursue investments in Mexico that make sense both from an economic and political perspective, such as supporting tourism, utilizing low-cost US natural gas, and delivering renewable power.
Although legal technology has made communications as between US and Mexico practices easier, faster and more efficient, the rapid advancement of technology (oftentimes with clients being ahead of their lawyers in implementing new technologies) and the pace of practice and client expectations are forcing lawyers (in the US, Mexico and elsewhere) to
adapt or face extinction. Our clients continue to demand efficiency and responsiveness, and we are increasingly expected to use technology to perform tasks traditionally performed by human beings.
We’ve seen law firm design change, including through smaller work spaces, remote offices, secure cloud-based solutions, mobile device communications, etc. We’ve also seen an increased focus on cybersecurity, and using artificial intelligence for technology-assisted review and early case/transaction assessment. I would expect growth and advancement in this area will continue, and US and Mexico law firms will need to keep up with these changes (including the risks and benefits associated with new technologies) in order to achieve strategic growth and overall survival. It will be interesting to see whether firm culture will survive and to what extent.
As with US in-house counsel working on my US-based or cross-border deals, Latin America-based in-house lawyers seem to share the same priorities in terms of client service. They demand efficiency, responsiveness and excellent legal service. They demand solutions. They view outside counsel as “insiders” with intimate knowledge of their company/institution, and the ability to find workable legal solutions to complex issues.
