Special Focus: US
One-way traffic
US law firms are benefiting
from Iberian infrastructure and
capital markets investment in
both North America and Latin
America, but there are doubts
about whether such firms will pick
up work related to Latin American
investment in Spain, Portugal and
Lusophone Africa
infrastructure expertise, it’s not surprising
they are targeting the US, which needs
renewed infrastructure.”
Xavier Ruiz, corporate partner in
Holland & Knight’s New York office,
says most of his firm’s work for Iberian
clients relates to infrastructure projects,
such as roads, tunnels, bridges and
power plants. While the US is a vast
country – with Spanish renewable energy
investments in California, Arizona, New
Mexico and Texas and transport projects in
Florida, Texas, Virginia, Illinois, Ohio and
Puerto Rico – Spanish clients continue to
flock to New York for finance.
The US has been an attractive destination
“The work has been mostly infrastructure
for Iberian investors looking to generate
finance, both in the US and Latin America,
new capital for almost a decade now.
work connected with Spanish debt
Spanish firms such as BBVA, Banco
Santander, Repsol YPF and Telefónica have restructuring and M&A transactions,
and corporate/tax structuring for new
listed or the New York exchange while
investments in the US,” explains Fernando
Abengoa and Grifols are on NASDAQ.
These include initial public offerings (IPOs) Rodriguez-Marin, of counsel at DLA Piper
in New York.
and secondary offerings, such as 144a
“Most financings require a strong
offerings.
connection with New York as New York
A number of US firms have benefited
law is used in most bank financings
from this, especially the New York capital
and in capital market transactions – this
markets teams. Davis Polk & Wardwell,
requires New York lawyers and financial
for instance, says it has represented every
advisors,” he adds. “In addition, the
Spanish company listed on the New York
most active multilateral institutions use
Stock Exchange. The deal flow remains
robust too, with recent examples including New York law in their standard financing
documentation for Latin American
Abengoa Yield’s $828 million offering,
Banco Popular Español’s €2.5 billion listing transactions.” Rodriguez-Marin says
infrastructure financings have been
and Amadeus’ €1.4 billion IPO.
focused on capital markets via project
However, when it comes to investment
bonds, known as 144a/Reg S bonds, with
flowing out of Latin America and into
possible bank financing such as bridge
Iberia and Lusophone Africa, opinions
loans or revolving facilities too.
differ as to whether US firms will pick up
Experts say if Latin American M&A and
much of the associated legal work.
infrastructure transactions require New
Spanish companies are currently
York banking or capital markets financing,
chasing American, and subsequently
clients need law firms with credible US
Latin American, assets. Due to domestic
economic troubles, Spanish companies are capacity to handle Latin American work.
“Many transactions in Latin America,
expanding abroad and the likes of ACS,
whether finance or M&A, are governed by
FCC and Iberdrola have bought major
New York law,” Ruiz confirms. “In addition,
assets in the US and Latin America.
construction, including EPC [engineering,
Renewables and infrastructure booming procurement and construction] contracts
are increasingly governed by US laws,
“We have seen work increase in the last
especially New York law.”
two years,” says María Luisa Cánovas,
Iberian companies doing business in
corporate partner in Jones Day’s New York
the Americas tend to use US firms for their
office, with regard to Iberian investors.
Latin American corporate and tax structures
“In our experience there has been quite a
boom in investment by Spanish companies and to ensure their Latin American
in renewables and infrastructure in the US transactions comply with US rules with an
extraterritorial reach, such as the Federal
given the lack of activity in Spain during
Corrupt Practices Act.
the crisis years. Given Spanish companies
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November / December 2014 • IBERIAN LAWYER • 53