London law firm Bird & Bird, working together with Borislav Boyanov & Co (Bulgaria), Dorda Brugger Jordis Rechtsanwälte (Austria), and Mouaimis & Mouaimis (Cyprus), have advised EBRD on the €118m loan financing for the purchase, by an Advent consortium, of a 65% stake in Bulgarian Telecommunications Company AD (“BTC”) and a subsequent €123m loan to BTC (in part for refinancing existing sovereign guaranteed debt).
The privatisation of BTC has been a very high profile matter in Bulgaria. In the last 2 years in particular, it has also been the subject of considerable political disagreement within Bulgaria, commercial protests and even a number of Court challenges. As a consequence, the transaction has gone through a number of phases and Bird & Bird and Bulgarian counsel have been required to advise on, and document, re-organisations of the financing structure on more than one occasion, almost always against the background of a challenging time constraints.
The Bird & Bird team, led by Trystan Tether (Head of Banking) and Andrew Hallgarth (Consultant), advised EBRD and the mandated lead arrangers of the participating syndicate (Citibank, N.A. and Bank Austria Creditanstalt AG) on the structure, loan documentation and security as well as on intercreditor arrangements with a syndicate of mezzanine finance providers (advised by Norton Rose and Macfarlanes). The borrowing group was advised by CMS Cameron McKenna.
Commenting on the transaction following syndication of the participations, Trystan Tether said:
“This was a challenging and interesting project of remarkable complexity. The normal legal demands of co-ordinating a project covering four jurisdictions were supplemented by a need to accommodate the tender-driven nature of the BTC sale arrangements and a highly-charged political situation in Bulgaria.”
Andrew Hallgarth added:
“The key to the successful completion of this financing was the co-operative spirit which existed between the borrower and the lenders and the legal teams of all sides, and an overriding determination to get the deal to closing even when this sometimes seemed to be against the odds. We are very pleased to have been involved in what was an important step towards the liberalisation of the Bulgarian economy and Bulgaria’s accession to the EC.”
For more information, please contact Trystan Tether on +44 (0) 20 7415 6034 or Larry Cattle on +44 (0) 20 7415 6156.