KSBG’s Financial Restructuring

Milbank advised KSBG on the deal.

KSBG Kommunale Beteiligungsgesellschaft GmbH & Co. KG announced its financial restructuring, including an amend & extend of its term loan facilities and the reorganisation of the financing structure of its subsidiary STEAG.

KSBG has been established by six municipal utilities of the Rhine-Ruhr area as acquisition and financing vehicle for STEAG, a leading energy producer and energy services provider with over 6,000 employees and 7,200 megawatts of installed capacity. STEAG group, having for decades been one of the leading German operators in the sector of hard coal-fired power generation, is in the process of repositioning itself and focusing on business areas and markets with growth potential, in particular renewable energies.

The financial restructuring transaction comprises an extension of the maturities of KSBG’s existing term loan facilities, which have been used to finance the acquisition of STEAG, and a comprehensive adjustment of the terms and conditions of KSBG’s loan facilities. In addition, the shares in KSBG shall be transferred into a double-sided trust structure with the restructuring expert Dr. Jan Markus Plathner being the designated trustee in order to support the transformation of the STEAG group and establish a stable platform for a value-maximising turnaround.

The financial restructuring of KSBG was accompanied by a comprehensive reorganisation of STEAG’s financing structure to ensure that the KSBG/STEAG group is fully financed throughout the transformation period. STEAG’s financing structure comprised various debt instruments, including Schuldschein loans with different maturities held by a diversified international investor base, and various bilateral cash and guarantee facilities made available by commercial banks and insurance companies.

The transaction stabilises the financing structure of the KSBG/STEAG group and is a key milestone for the continuation of the transformation of the STEAG group.

Milbank LLP has advised KSBG on all aspects of the restructuring. The team was led by Mathias Eisen (lead, Financial Restructuring, Frankfurt, Picture) and included Thomas Kleinheisterkamp (Tax, Munich), Christoph Rothenfußer, Martin Erhardt (both Corporate/M&A, Munich), Alexander Rinne (Competition, Munich), Robert Kastl (Financial Restructuring, Frankfurt), J. Melchior Raiser (Finance, Munich), Sebastian Trompler, Lara Milione (both Finance, Frankfurt), Sebastian Reiner-Pechtl, Johannes Rogge-Balleer, Manuel Bogenreuther, (all Corporate/M&A, Munich) and Susanne Schricker (Antitrust, Munich).

Involved fees earner: Manuel Bogenreuther – Milbank LLP; Mathias Eisen – Milbank LLP; Martin Erhardt – Milbank LLP; Robert Kastl – Milbank LLP; Thomas Kleinheisterkamp – Milbank LLP; Lara Letizia Milione – Milbank LLP; Melchior Raiser – Milbank LLP; Sebastian Reiner-Pechtl – Milbank LLP; Alexander Rinne – Milbank LLP; Johannes Rogge-Balleer – Milbank LLP; Christoph Rothenfusser – Milbank LLP; Susanne Schricker – Milbank LLP; Sebastian Trompler – Milbank LLP;

Law Firms: Milbank LLP;

Clients: KSBG Kommunale Beteiligungsgesellschaft GmbH & Co. KG;

Martina Bellini

Author: Martina Bellini