Adler Group S.A. and its subsidiaries have successfully implemented their financial restructuring, which includes amendments to the terms and conditions of six series of German law senior unsecured notes (SUNs) with an aggregate nominal amount of EUR 3.2 billion and the provision of approx. EUR 937.5 million of new money funding to stabilize the real estate company and its capital structure. In the course of the new money funding, the new money investors acquired, inter alia, newly issued shares in Adler Group S.A. representing 22.5 percent of the share capital on a fully diluted basis.
The relevant amendments to the SUNs were implemented by means of a restructuring plan under Part 26A of the English Companies Act, after a consent solicitation pursuant to the German Bond Act (Schuldverschreibungsgesetz) had failed in one series of notes at the end of 2022 due to fierce resistance of a minority ad-hoc group of bondholders. On 12 April 2023, the High Court of England and Wales sanctioned the heavily contested restructuring plan, dealing inter alia with complex issues of German law, including questions on the recognition of the restructuring plan in Germany and the validity of an issuer substitution clause contained in the terms and conditions of the SUNs.
Over the last twelve months, Hengeler Mueller provided comprehensive advice to the largest group of bondholders on this groundbreaking case. This included the negotiations of the financial restructuring leading to the new money funding commitments and a lock-up to support the restructuring via a consent solicitation as well as alternative implementation methods including Part 26A proceedings. Our advice covered the consent solicitation pursuant to the German Bond Act and the German aspects of the Part 26A proceedings. In addition, Hengeler Mueller advised on the complex new money funding structure through an orphan Luxembourg SPV. This included the preparation and negotiation of the finance documents, in particular the credit agreement between the SPV and Adler, the terms and conditions of new money notes issued by the SPV, two intercreditor agreements as well as a comprehensive security package. In addition, Hengeler Mueller provided ongoing advice on regulatory and litigation matters.
Hengeler Mueller team for Bondholder Group
Restructuring/Financing: Martin Tasma (Berlin), Johannes Tieves, Nikolaus Vieten (all lead), Daniela Böning and Henning Hilke (all partners, Frankfurt), Arvid Morawe (London), Jasper Bothe (Berlin), Tobias Braun (Frankfurt), Philipp Halm, Nicolas Kutscher, Fabian Berdin, Moritz Müller-Leibenger (all Berlin), Jennifer Ellen Klein, Simon Tänzer (both Frankfurt, all associates),
Capital Markets: Alexander Rang, Dirk Hermann Bliesener (both partners), Axel Gehringer, Martin Peters (both counsels), Christoph Roggemann (all Frankfurt), Siyuan Zhou (Berlin, both associates),
Corporate: Hartwin Bungert (Dusseldorf), Jens Wenzel, Kai-Steffen Scholz (both Berlin), Lucina Berger, Frank Burmeister (both Frankfurt, all partners), Christian Strothotte (counsel, Dusseldorf), Ingo Berner, Krzysztof Paluch (both Berlin), Julia Redbrake, Andreas Tarde (both Dusseldorf), Georg Tauser (Frankfurt, all associates),
Dispute Resolution: Philipp Hanfland (Frankfurt/London), Mathäus Mogendorf (Berlin, both partners), Natalia Dobrosz (London), Alexander Ruckteschler, Frithjof Schütte (both Frankfurt), Hedger Roisenwasser (Berlin, all associates),
Compliance: Constantin Lauterwein (partner), Melena Katharina Krause, Sophia Maurer, Dominik Hotz (all associates, all Berlin),
Tax: Matthias Scheifele (partner, Munich), Sebastian Heinrichs (counsel, Frankfurt), Isabella Zimmerl (Munich), Maximilian Maucher (Frankfurt, both associates),
Banking Regulatory: Christian Schmies (partner), Jan Letto Steffen (counsel), Gerrit Tönningsen, Natalie-Dilan Yerlikaya, Henrik Gildehaus (all associates, all Frankfurt).
Public Law: Fabian Alexander Quast (partner, Berlin), Carolin Raspé (counsel, Munich), Kevin Marschhäuser, Tom Pleiner, Andreas Puhl (all associates, Berlin).
The Hengeler Mueller-team worked closely with teams from Milbank, led by Jacqueline Ingram, Yushan Ng and Mathias Eisen, Loyens & Loeff, led by Michael Scott, De Brauw, led by Ferdinand Hengst, as well as Houlihan Lokey, led by Manuel Martinez-Fidalgo and Ulrich Graebner. The steering committee of bondholders was represented in the Restructing Plan proceedings by Felicity Toube KC and Henry Phillips of South Square.