PRACTICES 

PRACTICES 

Banking & Finance 

FLAG offers extensive experience in Banking and Finance for both local and cross border transactions, advising an extensive list of national and foreign financial entities including commercial and development banks. Our lawyers at FLAG provide creative, efficient and comprehensive advice for implementing all types of financings, including bilateral, syndicated or simple, guaranteed and unsecured loans. Our structured finance practice is second to none both in asset based as well as future flow-based financing, including:

  • Collection rights and receivable accounts, including loans.
  • Leases and financial assets factoring.
  • Mortgage, consumer and auto loans.
  • Future flows (such as highways toll road incomes).
  • Real estate developments (residential, commercial or industrial).
  • Railcars and subway cars.
  • Hotels (and their future income).
  • Private & Commercial Aircrafts.
  • Tankers & Vessels.
  • Infrastructure projects, concessions and government contracts.
  • Maritime platforms and ports.
  • Federal, state and municipal revenues.
  • We actively advise lenders and debtors in the negotiation, structuring and implementation of the relevant financing, its source of payment or alternative source of payment, as well as the corresponding security package. Likewise, FLAG represents lead arrangers and borrowers during the syndication process, including negotiations with other banks and the subsequent implementation of the lenders’ agreement and corresponding documentation.

  • Our team also advises lenders and borrowers in short-term financing (bridge loans) and, subsequently, in the long-term refinancing of such loans as either long-term bank financing, long-term debt in the capital markets or in a combination of both.

  • Additionally, we advise banks and borrowers in the implementation of derivative or hedging transactions (including the relevant security package).

Relevant Transactions

Below you will find a few examples of the relevant transactions in which our team has participated:

1.  We advised a global major investment bank, as lender and lead arranger, and a syndicate of national and global commercial and investment banks, in an structured asset backed SLBO (structured leveraged buyout) for the acquisition of a leasing business in Mexico for an approximate amount (between pesos and dollars) of US $1 billion. This transaction included long-term refinancing through the issuance of bonds under rule 144-A and Regulation S of the Securities Act, as well as a loan by a both domestic and international bank syndicates.

2.  We represented a syndicate of local and global investment and commercial banks in the refinancing of a long-term loan of MXN $11 billion.

3.  Our team advised a large Spanish bank in the financing of US $210 million to a Spanish hotel group with developments in the Riviera Maya. We also advised the bank in the implementation of a derivative operation covering the loan.

4.  We represented a syndicate of commercial and investment banks in a bridge financing and a term financing to one of the largest Mexican mining groups for the acquisition of certain maritime platforms, for an approximate amount of US $400 million.

5.  We advised one of the main airport operator groups in Mexico in its global initial public offering, which is considered one of the largest share offerings in Mexico for the amount of US $1 billion.

Public Finance

  • FLAG offers extensive and highly sophisticated experience in public financing, actively advising credit institutions, the federal government, states and municipalities in the structuring, negotiation and implementation of financing, refinancing and restructuring of public debt. Our team has participated in most major public finance transactions in Mexico and we are proud that various structures and legal documentation created by our lawyers are market references in the Mexican public finance industry.

  • The FLAG team is recognized as a key legal player in the formation and development of the public financing sector in Mexico. We have participated in the creation and amendment of several public debt and public finance state laws. Moreover, our lawyers implemented the first securitizations of local taxes of various states and municipalities in Mexico.

Relevant Transactions

The Flag team has participated in most major public finance transactions in Mexico, including among others:

1.  Financing of US $3 billion to a state in Mexico.

2.   Restructuring of a state’s debt with the commercial and development banks, for an approximate amount of MXN $30 billion.

3.  Refinancing of various loans granted to one of the states of the Mexican Republic for an amount of MXN $4.5 billion.

4.  Securitization of payroll taxes, for an amount exceeding MXN $2 billion. This transaction was the first of its kind and has been used as standard for the market.

5.  Refinancing of a state’s debt in an amount of US $30 million.

Capital Markets

  • FLAG represents issuers and underwriters in capital markets transactions, including the structuring and implementation of short, medium and long-term debt and structured debt offerings whether public or private.

  • We have a deep and broad experience in local and cross border securitizations (such as the issuance of notes under rule 144-A and Regulation S of the Securities Act) backed with all types of assets and future flows, such as mortgages, consumer and auto loans, receivables, leasing and factoring operations, as well as securitizations of federal, local and municipal revenues, taxes and duties, payroll taxes, road tolls, among others.

  • We have also advised clients on initial public offerings and secondary offerings, including CKDs and other capital funding structures, corporate bonds, sovereign and sub-sovereign bonds, derivatives and synthetic transactions, including derivative instruments such as interest rate caps and swaps, synthetic securitizations, collateralized debt (CDO), credit default swaps and total return swaps.

Relevant Transactions

Our lawyers have participated in highly sophisticated and complex local and cross border capital market transactions, including:

1.  The issuance of bonds under rule 144-A and Regulation S of the Securities Act for an approximate amount of US $400 million, advising a global investment bank as underwriter and Initial Purchaser.

2.  Registration of a MXN $10 billion debt program (and issuances thereunder in the Mexican Stock Exchange) of a financial entity of the Federal Government dedicated to the granting of consumer loans to the state employees, advising the issuer.

3.  The first cross border securitization backed by mortgages for an approximate amount of US $458 million, by a federal government financial institution that grants mortgage loans to state employees, advising the issuer.

4.  First two securitizations of toll roads secured by financial guarantees (monoliners) in Mexico.

5.  The restructuring of global bonds issued by one of the largest Mexican infrastructure companies for an amount of US $200 million, advising a global bank based in New York.

M&A – Private Equity

Mergers and Acquisitions

  • Our lawyers have broad experience in M&A transactions, representing domestic, foreign and global entities, both regulated and unregulated, in different markets and industries, including telecommunications, infrastructure, energy, real estate, financial, and pharmaceutical companies, among others.

  • FLAG represents global, foreign and domestic clients in the acquisition of (or investment in) Mexican companies. Always guided by our clients’ best interests, FLAG seeks to provide advice to our clients in collaboration with bankers and accountants since the inception of the transaction, up to the negotiation and closing. Our advice includes negotiating and implementing joint ventures, as well as the relevant corporate governance provisions, including shareholders agreements and voting trusts.

  • In FLAG we actively represent companies in corporate reorganizations, spin-offs and dissolutions, whether independent from, prior, during, or following a merger or acquisition.

Private Equity

  • FLAG represents clients in the creation of private equity, venture capital and seed capital investment funds and trusts, companies and trusts (fideicomisos) using innovative and complex structures based on the particular need of our clients in each transaction.

  • We advise clients in the entire life cycle of the investment funds from the creation of the respective investment vehicle to the capital raising and funding process, including capital calls or the implementation of convertible financing for third parties or shareholders.

  • FLAG has represented development banks, funds, and private individuals in the negotiation of the corporate governance for target companies, joint ventures and the investment vehicle itself.

Relevant Transactions

Our team of lawyers have advised local and global clients on relevant transactions, including:

1.  One of the largest global wireless infrastructure telecommunications company, in the acquisition of the fiber optic business from an information technology company, for US $500 million.

2.  A group of majority shareholders of a financial services company specialized in the mortgage sector in the sale of 49% of its equity for US $400 million.

3.  An international company in the acquisition of a gas pipeline in Mexico, as well as the subsequent sale of assets in favor of an international conglomerate dedicated to the energy industry.

4.  A foreign sugar producing company in the acquisition of 51% of the capital of a Mexican sugar company for US $30 million.

5.  Structuring and creating a hedge fund focused on a wide range of securities and financial instruments, long and short term, domestic and foreign in Latin America, representing the sponsors.

Restructuring

  • Our team has participated in the refinancing and restructuring of private and public debt. We have also participated in the reorganization of companies in diverse industries, whether privately or in a concurso mercantil process, including highly complex and sophisticated transactions, such as debt under derivative instruments, anti-trust driven reorganizations and restructurings in complex financial structures.

  • We have represented national and foreign financial institutions and companies as creditors, debtors, trusts and indenture trustees, in the reorganization of all kinds of companies in insolvency, including infrastructure companies, business groups specialized in all types of real estate developments.

  • Driven by our clients’ best interest and always considering all multidisciplinary aspects of a reorganization or restructuring, our representation includes the negotiation of the restructuring agreement, whether it is a prepack agreement or an agreement reached in a concurso mercantil process.

Relevant Transactions

1.  Restructuring of one of the largest infrastructure companies in Mexico in a concurso mercantil process, representing a global bank based in New York, as indenture trustee and representative of the holders of commercial bonds.

2.  Restructuring of a leading glass manufacturer in Mexico, advising an international bank as financial agent.

3.  A global bank based in New York, in the restructuring of a non-bank lending institution dedicated to the mortgage sector.

4.  A global bank based in New York, in the restructuring of a financial institution specialized in real estate.

Project Finance

  • In FLAG we represent financial institutions and development banks, both local and foreign, developers and sponsors, contractors and concessionaires, as well as the federal government, states and municipalities, in the development and financing of projects, including but not limited to:

  • Wind Farms.

  • Highways and toll roads.

  • Luminaries.

  • Desalination plants.

  • Water treatment plants.

  • Hospital Construction.

  • Modal Transfer Center (CETRAM).

  • Public Private Partnerships (APP).

  • Government services agreements (PPS).

  • Our advisory begins from the structuring and negotiation of projects, either through public tenders or private competitions, until the negotiation and implementation of the corresponding financing and the subsequent operation of the projects. Likewise, our experience enables us advising our clients in implementing and negotiating security packages and sources of payment, as well as those control rights over the project (step in rights).

  • FLAG actively advises municipal, state, and federal governments, as well as individuals and financial entities, in the negotiation and contracting of public works, contracts for the rendering of services, concession titles and the creation of Public-Private Partnerships. We also participate in the negotiation and structuring of bank financing for such infrastructure projects.

Relevant Transactions

We have advised clients in a variety of major project finance transactions in Mexico, including:

1.  A National Bank in financing the concessionaire of a wastewater treatment plant in a state of the republic, including the due diligence of the process of awarding the contract for the provision of services and the subsequent financing.

2.  A sustainable energy project developer based in California, in the development, financing and sale of the first two stages of a wind farm to funds managed by financial institutions.

3.  An international development bank in the financing of a desalination plant in the Mexican border, for MXN $700 million.

4.  A Mexican bank in the financing of a CETRAM through a Public-Private Partnership contract, in an amount of MXN $600 million.

Debt Restructuring

  • Our team has participated in the refinancing and restructuring of private and public debt. We have also participated in the reorganization of companies in diverse industries, whether privately or in a concurso mercantil process, including highly complex and sophisticated transactions, such as debt under derivative instruments, anti-trust driven reorganizations and restructurings in complex financial structures.

  • We have represented national and foreign financial institutions and companies as creditors, debtors, trusts and indenture trustees, in the reorganization of all kinds of companies in insolvency, including infrastructure companies, business groups specialized in all types of real estate developments.

  • Driven by our clients’ best interest and always considering all multidisciplinary aspects of a reorganization or restructuring, our representation includes the negotiation of the restructuring agreement, whether it is a prepack agreement or an agreement reached in a concurso mercantil process.

Relevant Transactions

The Flag team has advised local and global clients on complex and high-level restructurings and reorganizations, including:

1.  Restructuring of one of the largest infrastructure companies in Mexico in a concurso mercantil process, representing a global bank based in New York, as indenture trustee and representative of the holders of commercial bonds.

2.  Restructuring of a leading glass manufacturer in Mexico, advising an international bank as financial agent.

3.  A global bank based in New York, in the restructuring of a non-bank lending institution dedicated to the mortgage sector.

4.  A global bank based in New York, in the restructuring of a financial institution specialized in real estate.

Benchmark Transactions in the Market

The FLAG lawyers have had a major role in the development of the Mexican finance market, participating in key
transactions of which structures have become standard or model in the market, including the following:

  • Advised leading global investment banks and commercial banks, including the lead lender and arranger, in the first
    SLBO (Structured leveraged buyout) in Mexico, with a bridge financing and its subsequent long-term refinancing without
    recourse against the sponsor or acquirer.

  • Participated in the first Mexican bond backed by mortgages.

  • Participated in the drafting team of federal legislation on financial guarantees or monoliners.

  • Participated in the drafting team of the federal legislation of Real Estate Investment Trust (REIT).

  • Structured the first securitization of state revenues of a Mexican state.

  • Represented a Mexican state in the first major debt restructuring in Mexico in 2005. The documents according to which
    this restructuring was implemented, particularly the master trust, continue to be the base documents for the structuring
    and restructuring of states and municipalities through master trusts.

  • Participated in the drafting and amendment of several public debt and finance laws of Mexican states.