Clifford Chance advises bookrunners on OHL’s high yield issue

Clifford Chance has advised the bookrunners in a €700m (£601.09) high yield issue by Obrascon Huarte Lain (OHL), one of Spain’s leading construction groups.

The deal featured a US-style high yield covenant package. While such covenants have traditionally been the domain of US firms, Clifford Chance partner Stephen Roith, who led the team working on the deal, expects more of these deals to be structured under English law.

The joint bookrunners were Crédit Agricole CIB, Citi, RBS, Santander and Société Générale. OHL was advised by a Linklaters team headed by Paris-based partner Lois Roth.

Roith, who was assisted on the deal by Jennifer McIvor, said:  “While investor demand for European high yield has been strong in recent months, sub-investment grade European issuers in general are now expected to give some version of a US-style high yield covenant package and to address any structural subordination issues, even in the case of a ‘Reg S only’ offering under English law.

“This issue, and others like it in recent months, provide further evidence that these covenant packages can be properly structured under English law.”

This issue is one of a number that Clifford Chance has advised on so far this year, closing over $1.3bn (£900m) in high yield deals in the first quarter of 2010, acting for both issuers and underwriters.