Transener in $470 Million Argentine Restructuring
March 22, 2005
Cleary Gottlieb is representing a creditors committee in the restructuring of approximately $470 million of outstanding debt of Argentine electricity transmission company Transener, S.A. The committee, which includes CSFB, Deutsche Bank, Fintech Advisory Ltd., Marathon Funds and UBS, worked with the company to design the proposals for the restructuring. Transener’s offer was launched on February 22 and is scheduled to expire on March 23, unless extended by the company. The company is seeking to restructure its debt under an Argentine consensual reorganization plan.
(Acuerdo Preventivo Extrajudicial), with the option of not seeking court approval for its reorganization plan and proceeding directly with an exchange with participating holders if it receives the support of holders of 97% or more of its debt.
Under the offer, holders of Transener’s outstanding debt can exchange their bonds and/or loans for a cash payment at a discount, new 11-year par notes, or a combination of 10-year discount notes and shares of the company’s common stock. If either the cash or the par options are under or oversubscribed, some debt may be reallocated among the options.
Each of the members of the creditors committee has entered into a support agreement with the company pursuant to which it has agreed to participate in the restructuring. Together, the members of the creditors committee hold approximately 66% of the aggregate outstanding principal amount of debt to be restructured.
Transener owns the concession to operate and maintain the leading high voltage electricity transmission system in Argentina and, via its subsidiary Transba S.A., the concession to operate and maintain the regional electricity transmission network for the Province of Buenos Aires.