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Offshore firms join in as Cleary and Clifford Chance lead on Rusal’s $5.15bn debt restructuring

Cleary Gottlieb Steen & Hamilton and Clifford Chance picked up the lead roles along with a raft of offshore firms as Russian aluminum giant Rusal carried out a $5.15bn debt restructuring following a slower than expected recovery in the commodities market.

London-based partner Polina Lyadnova led for Cleary as Hong Kong-listed Rusal extended two financial agreements, a $4.75bn facility agreed in 2011 with lenders led by French bank BNP Paribas and a $400m facility created in 2013 with a gaggle of financial institutions that includes Dutch bank ING, from 2018 to 2020. The lenders were advised on the deal by Clifford Chance’s Moscow managing partner Logan Wright and London-based partner Iain White.

It is Rusal’s largest restructuring since 2009, when Lyadnova served as counsel on its $16.8bn restructuring, the largest ever for a Russian company.

With some of the lenders involved having originally held out of the deal, Cleary Gottlieb also advised on a proposed parallel schemes of arrangement in England and Jersey, where Rusal is incorporated, to secure a court-binding sanction forcing holdout creditors into the agreement. However, given that more than 75% of the lenders approved the extension and readjustment of terms, the $5.15bn restructuring was eventually agreed voluntarily on 18 August.

Lyadnova was supported by London-based associates Jim Ho, David Stubbs and Michael Rackham, and a similar sized team in Moscow. Additional advice was provided in Jersey by local firm Bedell, with senior partner Anthony Dessain and litigation partner Edward Drummond. Cleary tapped Pestalozzi for local advice in Switzerland and Harneys in Cyprus.