A&O Shearman, Sidley Austin and Weil Gotshal & Manges have advised on the USD11.5 billion offshore debt restructuring of Hong Kong-listed Shimao Group, a real estate development company.
Viola Jing, A&O Shearman’s lead partner for this deal, said her team played a key role in advising CoCom [the co-ordination committee of lenders] on the technical requirements necessary to implement a comprehensive restructuring of its offshore debt through a scheme of arrangement.
“We, partnering with Deloitte as financial advisers to the Co-Com, engaged with Shimao and its advisers as well as the ad hoc group of bondholders and their advisers to achieve a timely, cost-effective and mutually beneficial solution for all stakeholders,” Jing told Asia Business Law Journal.
A&O Shearman advised CoCom on facilitating negotiations and structuring the deal. Hong Kong-based partner Jing led the team, with support from a bench of lawyers across Hong Kong, Beijing and Singapore.
Jing described the restructuring, which was achieved through a court-sanctioned Hong Kong scheme of arrangement, as “one of the earliest and most protracted in the recent wave of Chinese property developer restructurings, [which] has ultimately received overwhelming support (over 95%) from bondholders and banks alike, voting as a single class”.
Sidley acted as the international counsel to Shimao, led by partner Renee Xiong in Hong Kong, with support from partners Matthew Sheridan in Singapore, Constance Choy, Olivia Ngan, Dhevine Chandrapala and Desmond Ang in Hong Kong.
“The Sidley team advised our longstanding client Shimao on their successful restructuring, providing holistic, multi-jurisdictional advice in relation to their offshore debts, as well as litigation advice… The restructuring is one of the largest to be sanctioned in the recent wave of Chinese real estate restructurings and marks a significant achievement for Shimao,” Xiong told Asia Business Law Journal.
Throughout the restructuring process, Sidley engaged with the creditors to facilitate the formulation of a proposal and new debt instrument documents.
Weil advised the ad hoc group of bondholders, led by Kathleen Aka, who provided strategic counsel on all aspects of the transaction, which had yet to be completed.
Jing told Asia Business Law Journal that property developers will increasingly rely on statutory restructuring mechanisms, such as schemes of arrangement, to manage their debt.
