Lawyer Monthly Magazine - August 2019 Edition

About Aymen Mahmoud Aymen Mahmoud, is a Partner at Willkie Farr & Gallagher (UK) LLP. He is a partner in the finance and capital markets practices in London and acts across a range of complex debt financing transactions for private equity funds and their portfolio companies, hedge funds, corporate borrowers and issuers and other financial institutions. His practice encompasses direct lending, leveraged buyouts, domestic and cross-border syndicated senior, second lien and junior lending, high yield debt offerings, special situations and distressed debt trading, and restructurings. Aymen commented: “We believe that our international footprint and focus on responsive client service will be critical to those successes and we will continue to develop the best local market talent to ensure maximum benefit to our clients. We would like to thank our existing clients for the support they continue to show us and our future clients for the opportunity to work with them!” Firm Profile Willkie is an elite international law firm of approximately 700 lawyers located in ten offices in six countries. For more than 125 years, we have represented companies across a wide spectrum of businesses and industries. The firm is comprised of attorneys who are recognized as some of the world’s foremost practitioners in their respective areas. At a time of macro eco-political market uncertainty, dispensing with this risk has become increasingly attractive to borrowers. European jurisdictions. More recently, some of the more US-centric restructuring tools around moratoriums, cram-down mechanics and rescue financings have started to pervade the European restructuring market such as in the UK and the Netherlands or more generally in the EU Directive on Insolvency. The first and often preferred method for handling a restructuring is often a consensual one. In these situations, the relationship between different classes of creditor is critical, together with their relative bargaining power, considering things such as the strength of their security, their intercreditor position and how easy it is to organize them as a collective. In a consensual restructuring, lenders often forego their rights for a limited period and often subject to certain conditions to give a borrower time to organize itself for a restructuring. During this time, groups of creditors will try to join together to form a consensus and the company may enter into a restructuring agreement with its creditors which documents the terms of any restructuring. This is typically less costly than the more formal procedures and has the benefit of maintaining creditor/borrower relationships and protecting the company as a going concern. Beyond that, there are several procedures available to creditors under English law, depending on the applicable facts. For example, a company led ‘Scheme of Arrangement’ under the Companies Act is a flexible process which is not a formal ‘insolvency’ process but allows for a restructuring of the balance sheet of a primary obligor. Disadvantages include publicity, with documents filed at court, there being no automatic protection such as a stay and the cost of some of the more complex arrangements can be significant. By contrast, the recently publicized ‘Creditors Voluntary Arrangement’ is a compromise between the unsecured creditors and a borrower with no court sanction and has been used recently by retail businesses to rationalize their leasehold liabilities. This is also a very flexible process which is not court-driven and is therefore not business destructive in that the company proposing the ‘CVA’ remains intact, preserving value. How would you describe the state of M&A in the UK given the current political and economic climate? There has been widespread interest and debate around M&A activity in light of the current political climate (and in turn, CONTACT DETAILS Aymen Mahmoud Willkie Farr & Gallagher (UK) LLP Citypoint, 1 Ropemaker Street | London EC2Y 9AW Direct: +44 203 580 4727 | amahmoud@willkie.com | www.willkie.com the economic consequences of that climate). It is clear that there has been consolidation in certain sectors (e.g. energy) but also that there has been significant growth in the chemical and technological industries, where disruptive innovation can move a particular market very quickly. We are fortunate to represent extremely sophisticated types of capital which combine strategic and opportune investment strategies to maximize returns both in a booming M&A market but also in a quieter one and in each case on a global scale. It is reasonable to expectthat greater political certainty would help to stabilize domestic M&A across a greater number of sectors. Is there a particular time of year that M&A deals become the most common? Why would you say this is? The financial markets are sometimes as emotive as they are calculated. We often see an increase in M&A activity during quarters one and four, with people buoyed by a more restful period! That aside, different markets are of course subject to their own movement factors and what is a busier time for M&A in one jurisdiction, sector or industry may not be the same as for another. Our job as advisers is to be on hand to react to the needs of our clients with regard to the markets that they are investing in and the timescale for their investment. LM Completing The Deal By Aymen Mahmoud, Willkie Farr & Gallagher (UK) LLP 97 AUG 2019 | WWW.LAWYER-MONTHLY.COM