White & Case Advises on BTA Bank Restructuring | White & Case LLP International Law Firm, Global Law Practice
White & Case Advises on BTA Bank Restructuring

White & Case Advises on BTA Bank Restructuring

Global law firm White & Case LLP has advised Kazakhstan's "BTA Bank" JSC (the "Bank") on the restructuring of approximately US$11.1 billion of its financial indebtedness.

The restructuring involved the holders of various classes of Eurobonds issued in connection with the Bank's first restructuring in 2010 and the lenders under the Bank's revolving committed trade finance facility, all of whom were represented in negotiations by a 10-member steering committee, and also involved JSC "Sovereign Wealth Fund "Samruk-Kazyna".

The Bank's restructuring plan was approved on 5 December 2012 by creditors holding 93.8 per cent of the total financial indebtedness subject to the restructuring, having previously been approved by the Bank's shareholders on 3 December 2012. The Specialised Financial Court of Almaty approved the restructuring plan on 13 December 2012 and declared the restructuring completed on 28 December 2012.

As a result of the restructuring, the Bank's existing Eurobonds were cancelled and the creditors were paid US$1,618 million of cash and issued US$750,000,000 of new senior notes, as well as new equity in the Bank. Further, the Bank's revolving committed trade finance facility was amended and restated to, among other things, extend its maturity and US$1,189 million of Samruk-Kazyna's deposits with the Bank were converted into equity. Samruk-Kazyna also made a US$1,592 million loan to the Bank which was subordinated to the new senior debt and the trade finance facility.

The restructuring proceedings received recognition in the courts of the USA, the UK, Russia, Kyrgyzstan and Ukraine. On 19 December 2012, a permanent stay preventing any creditors from bringing further proceedings against the Bank in the UK was granted by the High Court and on 3 January 2013 the United States Bankruptcy Court for the Southern District of New York granted a permanent injunction against further proceedings against the Bank or its assets in the United States.

White & Case had advised the Bank on its first restructuring, completed in August 2010, relating to approximately US$16.65 billion of indebtedness and also advised on the successful US$4.5 billion debt restructuring of JSC Alliance Bank, which completed in March 2010.

"Although BTA's creditor profile in the second restructuring was much simpler than it had been in 2010, there were still some novel issues faced in 2012 such as the position of the recovery unit holders and the terms of the subordinated loan from Samruk-Kazyna, which gave the creditors the credit enhancement they wanted without the need for any direct credit support. Congratulations to the BTA team on a job well done," said White & Case partner Francis Fitzherbert-Brockholes.

White & Case LLP's team was led by London partners Francis Fitzherbert-Brockholes and Ian Clark and included London associates Chris Horte, Dave Gossen, James Clarke, Martin Mojzis and Gulzhan Nurakhmet, whilst partners John Higham QC and Charles Balmain, associate Laetitia Souesme and trainee solicitor Laura Smith handled the recognition applications in the UK. The Almaty-based team was led by partner Maxim Telemtayev and senior associate Askar Zhansagimov and included counsel Kairat Baizakov and local partners Pavel Kornilov and Vilen Adjivefayev. The New York team included partner Michael Shepherd and associates Richard Graham and Ian Silverbrand and the Moscow team included associates Pavel Boulatov and Daria Vasilieva. The Bank's financial advisers were Lazard Frères.

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