Dr. Volker Glas, MMag. Christian Aichinger
voestalpine AG invited all holders of 2007 Hybrid Notes (with a nominal value of EUR 1 billion) to offer to exchange their notes for new 2013 Hybrid Notes with a volume of up to EUR 500 million. More than 70% of investors wanted to exchange their notes. Therefore, the issue volume of the 2013 Hybrid Notes of EUR 500 million was fully utilized. The subordinated notes have an indefinite term and an initial coupon of 7.125% per annum until 31 October 2014 (the earliest possible termination date for the 2007 Hybrid Notes) and then 6% per annum until 31 October 2019.
It is the first capital market transaction of its kind in Austria not to offer to buy back notes for cash, but exclusively to offer to exchange them for a new hybrid instrument.
CHSH acted as transaction counsel to voestalpine for whom it drafted an issuance programme in 2012 which made such an exchange programme possible, and it also advised the banking consortium led by Erste Group.
The team at CHSH consisted of partner Volker Glas and attorney Christian Aichinger. Volker Glas: "The transaction was particularly challenging because it not only involved the drafting of an innovative Exchange Offer Memorandum, but also a series of regulatory issues of a structural nature, right through to settlement issues."