Milbank Advises Porterbrook in Establishment of £3 Billion Secured Guaranteed Bond Programme for Refinancing of Existing Senior Term Loan Facilities
LONDON, 9 June 2010 – Milbank, Tweed, Hadley & McCloy LLP has represented Porterbrook, the rolling stock leasing business, in connection with the establishment of a £3,000,000,000 multicurrency programme for the issuance of secured guaranteed bonds (the proceeds of which may be used to refinance existing indebtedness and/or for general corporate purposes).
In connection with the establishment of the programme Milbank, Tweed, Hadley & McCloy LLP also advised Porterbrook on the amendment and restatement of its existing senior and junior facilities agreements and on the establishment of a revised bank/bond intercreditor framework.
On 9 June 2010, Series 1 £250,000,000 6.500 per cent. bonds due 2020 and Series 2 £270,000,000 7.125 per cent. bonds due 2026 were issued under the programme.
The proceeds of the initial issuance of the Series 1 and Series 2 bonds under the programme will be used to prepay certain term loans under Porterbrook’s existing £1,525,000,000 senior facilities agreement which (together with a £115,000,000 junior facility agreement) was entered into by the Porterbrook group in October 2008.
The Porterbrook group is a leading UK ROSCO with market share of approximately 32% of the UK passenger train leasing market. It is currently owned by a consortium consisting of Deutsche Bank AG, Antin Infrastructure Partners (the BNP Paribas sponsored infrastructure fund), Lloyds TSB Group plc and OP Trust. Milbank originally advised the consortium vehicle on its acquisition of Porterbrook in 2008.
The initial dealers involved in respect of the bond programme were Barclays Bank PLC, BNP Paribas, Crédit Agricole Corporate & Investment Bank, Lloyds TSB Bank plc and The Royal Bank of Scotland plc. The senior lenders involved in the bank refinancing were Abbey National Treasury Services plc, Barclays Bank PLC, BNP Paribas, London Branch, Crédit Agricole Corporate & Investment Bank, Commonwealth Bank of Australia, Dexia Crédit Local, London Branch, Lloyds TSB Bank plc, Lombard North Central plc and Sumitomo Mitsui Banking Corporation.
The London-based Milbank team was led by partner Suhrud Mehta, and included Capital Markets partners James Warbey and Tom Siebens, together with European counsel Patrick Holmes, senior associates Ben Farnsworth and David Gasperow and associates Alex Schofield, Michael Clarke and Victoria Boid. Tax and Corporate advice was provided by Tax partner Russell Jacobs together with senior associate Matthew Mortimer, and Corporate partner Stuart Harray.
Mr. Mehta, commenting on Milbank’s role, said:
“We are very pleased to have assisted Porterbrook in establishing this first of a kind financing structure – a necessary step for Porterbrook’s continued long-term access to the bank and bond markets. The financing structure strikes a necessary balance between key constituents: banks, bondholders, hedge counterparties and the company itself. Developing such bespoke solutions lies at the core of our finance practice, which is focused on the complex end of the market.”
About Milbank
Milbank, Tweed, Hadley & McCloy LLP is an elite global law firm that for more than 140 years has provided innovative legal solutions in many of the world’s largest, most complex, “first–ever” corporate and financing transactions, restructurings and litigation. Our transactional expertise includes capital markets, corporate finance, project finance, acquisition finance, and other major fields of law practice. The Firm is headquartered in New York with offices in Beijing, Frankfurt, Hong Kong, London, Los Angeles, Munich, Singapore, Tokyo, and Washington, DC.