White & Case Advises International Bank of Azerbaijan on US$3.4 Billion Restructuring
Global law firm White & Case LLP has advised OJSC International Bank of Azerbaijan (IBA), the largest bank in Azerbaijan, on the restructuring of approximately US$3.4 billion of its financial indebtedness.
"The disparate nature of IBA's creditor constituency brought certain unique complexities to the transaction," said London-based White & Case partner Ian Clark, who co-led the Firm's deal team. "In addition the systemic importance of IBA, and the resulting need to avoid risks to the Azeri banking sector more broadly, meant that it was essential for the transaction to be implemented within the shortest possible timeframe."
The restructuring was carried out in accordance with procedures for voluntary restructuring of bank liabilities under the Azerbaijan Law on Banks, and the restructuring plan was approved on July 18, 2017 by creditors holding 93.9 percent of IBA's total indebtedness subject to the restructuring. The plan was also approved by the Financial Market Supervisory Authority of Azerbaijan (FIMSA) on July 25, 2017, and by the Nasimi District Court in Baku on August 17, 2017.
"Our work on IBA's restructuring built on our Firm's extensive experience advising on cross-border restructurings in the CIS region, including the Firm's work in Kazakhstan and Ukraine," said London-based White & Case partner of counsel Francis Fitzherbert-Brockholes, who co-led the deal team. "White & Case is uniquely positioned to support clients in these complex situations, and we were able to assist IBA with this successful transaction that was implemented in a record timeframe of less than six months."
IBA's indebtedness that was subject to restructuring was exchanged for US$2.27 billion in new direct sovereign obligations issued by the Ministry of Finance of the Republic of Azerbaijan, and US$1 billion in new debt securities issued by IBA. The transaction was critical to restoring IBA's financial stability and capital adequacy; the bank accounts for approximately 40 percent of Azerbaijan's banking assets.
White & Case is also representing IBA on the recognition of the Azeri restructuring proceedings in the UK and the US. The Firm has successfully obtained recognition of the Azeri proceedings as foreign main proceedings in the UK High Court under the Cross-Border Insolvency Regulations, and in the US District Court for the Southern District of New York under Chapter 15 of the US Bankruptcy Code, and continues to represent IBA in those proceedings.
The White & Case team which advised on the transaction involved more than 50 lawyers from eight offices. It was led by partner Ian Clark, partner of counsel Francis Fitzherbert-Brockholes and associate Martin Mojzis (all London), and included partner Laura Prater and associates James Clarke, Hashim Eltumi and Kevin Heverin (all London). Partner Charles Balmain and associates Swati Tripathi and Alana Shine (all London) handled IBA's recognition application in the UK, while partners Thomas MacWright (New York), Jason Zakia (Miami), Gregory Starner (New York) and David Turetsky (New York), counsel Richard Graham (New York) and associates Laura Femino (Miami), Misha Ross (New York) and Laurent Lantonnois (New York) handled the recognition application in the US.
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