The Republic of Korea in €700 Million and $500 Million Offering

October 15, 2021

Cleary Gottlieb represented the Republic of Korea (ROK) in its SEC-registered dual-tranche offering of €700 million zero coupon green notes due 2026 and $500 million 1.75% notes due 2031.

The offering was a takedown from ROK’s shelf registration statement under Schedule B. The offering priced on October 6, 2021, and closed on October 15, 2021.

The euro-denominated notes were listed on the Singapore Exchange and the London Stock Exchange, and the U.S. dollar-denominated notes were listed on the Singapore Exchange. BofA Securities, Citigroup, Credit Agricole CIB, HSBC, J.P. Morgan, and The Korea Development Bank were the joint bookrunnners for the offering.

The notes included enhanced Collective Action Clauses (CACs), which are designed to promote expeditious and orderly restructurings and workout procedures for sovereign debtors should a sovereign debt crisis ever occur. In particular, the enhanced CACs include a “single-limb” aggregated voting procedure clause, which will enable the notes to be restructured on the basis of a single vote across all affected instruments to be an effective tool to limit the ability of holdouts to undermine the restructuring process. To safeguard the interests of creditors, the enhanced CACs require all affected noteholders to be offered the same instrument or an identical menu of instruments and include a voting threshold of 75% of the aggregated outstanding principal of all affected note series. The enhanced CACs are also flexible to allow for differentiation among creditors where appropriate and provide a menu of voting procedures, including a single-limb aggregated voting procedure, a two-limb aggregated voting procedure and a series-by-series voting procedure.