Latham & Watkins and Ropes & Gray have fielded London teams to advise on a deal that sees a consortium led by Goldman Sachs invest $1.1bn (£680m) to restructure the debt of Israeli telecoms group HOT-Telecommunications Systems as the company’s owner takes the business private.
French-Israeli businessman Patrick Drahi, the controlling shareholder of HOT, is delisting the company after the cable operator moved into the Israeli mobile market earlier this year.
Once the business becomes private it is understood that Drahi’s private business Altice, a European cable and telecom investment company, will then provide financing to restructure the company’s debt.
HOT, a subsidiary of Altice, is one of Israel’s largest telecoms groups.
Altice turned to Ropes for legal advice, hiring a team led by London finance partners Michael Kazakevich and Mike Goetz. The group was also advised by Israeli firm Meitar Liquornik Geva & Leshem Brandwein, while German firm Luther provided legal advice from Luxembourg, where the bonds are understood to be listed.
Ropes advised Altice on the bridge facilities, the high-yield offering and the related super-senior revolving credit facility and security arrangements.
The debt was raised by international investors in London, with lead investor Goldman instructing Latham & Watkins London-based corporate partner Scott Colwell as lead adviser for the consortium of banks. Other investors were HSBC and Morgan Stanley.
Ropes said the transaction was the first-ever international high-yield financing for an Israeli company. The deal is due to close by the end of this month.
Background to this deal:
Altice is a new client for Ropes, which won the deal from a longstanding relationship with former Liberty Global treasurer Dennis Okhuijsen, who is understood to have left the cable company for Altice earlier this year.
Israel’s status as a fast-growing power in the fields of IT, energy and finance and a hotbed for high-tech companies and start-ups has provided foreign law firms with a handful of mandate opportunities. The discovery of the Tamar and Leviathan gas fields off Israel’s coast have also brought fresh attention to the country, with Allen & Overy and Shearman & Sterling winning roles on the financing of the Tamar development (10 September 2012).
For more on the Israeli legal market, see special report