rbs / chrysalis group

Before the Royal Bank of Scotland (RBS) merged with NatWest last year, Weil Gotshal & Manges handled securitisation work for Greenwich NatWest, part of NatWest Markets.

After the merger, Weil Gotshal developed a relationship with RBS and it now advises the bank on much of its asset-backed finance work.

The Chrysalis deal is the first ever securitisation of royalty payments for a multi-jurisdictional music publishing catalogue. The deal included royalty streams in the US, UK, Germany, Sweden and the Netherlands. Finding a structure that incorporated the differing approaches to securitisation in each jurisdiction was problematic. The UK may be creditor friendly but other jurisdictions are less so, and outside the UK there are a number of ways to freeze security. The deal was structured using secured-loan technology in the UK and true-sale technology in the US, Germany and the Netherlands. True sale technology involves isolating assets by selling them to special-purpose companies created specifically for the deal. This helped overcome legal and tax discrepancies. It also meant that in the unlikely event of Chrysalis going bust, the assets would be protected.

In Sweden there is no law that deals with the possibility of transferring title to copyright so Chrysalis sold the rights to the Swedish special purpose company.