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Client Alert February 15, 2024

Non-Traditional Sovereign Debt Defaults Recovery Strategies for International Bondholders

  • Sovereign defaults are increasing after recent years of post-pandemic spending, geopolitical risk and climate change.
  • This has created opportunities for distressed investors experienced in enforcing against sovereigns.
  • Investors can improve the value of their claims by deploying strategies targeting unconventional vulnerabilities around the world.

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Client Alert October 12, 2023

Cross-Border Strategies to Accelerate Non-Performing Loans Recoveries in Korea

  • Korean banks are holding an increasing amount of non-performing loans, putting their financial health at risk.
  • For many with large portfolios exposed to cross-border unsecured debt and loans to high-yield borrowers, sale and write downs may not be optimal.
  • A cross-border strategy to monetize their claims could offer a superior alternative.

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Client Alert August 3, 2023

The BVI Creates New Opportunities for Offshore Bondholders to Bring Unilateral Claims

  • Distressed debt investors who are beneficial owners or contingent creditors of bonds face uncertainty when bond issuers stop paying.
  • Courts in key jurisdictions are beginning to answer the question of whether creditors can wind-up issuers but are offering diverging decisions.
  • We explain how a recent ruling in the BVI opens the offshore jurisdiction to creditors considering a cross-border enforcement campaign.

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Client Alert July 20, 2023

Creditors Should Enforce PRC Keepwell Agreements Overseas

  • Many Chinese debt issuers are still undergoing a wave of defaults, putting offshore general unsecured creditors at risk.
  • One way to secure substantial recovery is to enforce keepwell agreements, promises by a PRC onshore parent company to maintain a debt issuer’s liquidity and solvency.
  • This can expand the range of enforcement targets, increasing creditors’ options and chances of success.

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Client Alert December 22, 2022

Defensive and Counter-Offensive Strategies for High-Yield Debt Issuers and Private Borrowers

  • Tightening global credit conditions will put more corporate high-yield debt issuers and private borrowers from emerging markets at risk of default.
  • This can spiral into complex cross-border disputes with creditors, threatening the company’s survival.
  • Fortunately, there are creative and aggressive strategies available for debtors to limit their exposure and protect their bottom lines.

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Client Alert March 28, 2022

Maximizing Recovery Against a Sanctioned Sovereign

  • Prices of Russian and other sovereign debt are falling as their economies buckle, presenting both opportunities and challenges for investors.
  • Enforcing the debt against sovereign entities is already difficult, more so when sanctions are involved.
  • As our Claim Monetization & Dilution team explains, non-traditional strategies may go further in putting maximum pressure on sovereigns and maximizing returns.

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Client Alert January 26, 2022

Looking to Enforce a PRC “Keepwell Agreement”? Look Outside the PRC

  • Mainland China is undergoing a wave of credit defaults, and creditors should use every tool available to maximize recovery.
  • Keepwell agreements, a promise by a PRC onshore parent company to maintain an offshore debt issuer’s solvency, is one option for overseas enforcement.
  • Creditors can use them to launch a multijurisdictional recovery campaign to drive up pressure on the debtor and reach a near-term settlement.

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Client Alert September 8, 2021

Maximizing Returns on Distressed Assets: China’s Real Estate Industry

  • Offshore bondholders of distressed Chinese real estate companies often lack leverage in restructuring negotiations, with those companies’ assets located mostly in China.
  • China Evergrande Group is just one of the many Chinese real estate companies teetering on default, with wide-ranging consequences.
  • However, by taking deploying creative strategies and taking positions against competing stakeholders, activist bondholders can carve out a direct path to monetization.

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