BlackRock, Sothic Capital Said to Form Abengoa Bond Group

  • Group hired Houlihan Lokey, Clifford Chance as advisers
  • Advisers holding call with bondholder group on Tuesday

BlackRock Inc. and Sothic Capital Management are leading a group of Abengoa SA bondholders that’s getting ready to protect its interests in debt restructuring talks with the Spanish renewable energy company, according to two people familiar with the matter.

The two funds formed a committee and appointed Houlihan Lokey Inc. and Clifford Chance as advisers, said the people, who asked not to be identified because the information is private. The group will hold a call with advisers on Tuesday at 3 p.m. in London, according to an e-mailed statement from Houlihan Lokey, who also asked other bondholders to contact them.

Abengoa, which has 8.9 billion euros ($9.4 billion) of gross debt, filed for preliminary creditor protection with a court in Seville last week and has four months to reach an agreement with creditors under Spanish bankruptcy law. If it fails, Abengoa will need to file for full creditor protection. More than 90 percent of cases that reach that stage in Spain end in liquidation, according to rating company Axesor.

Officials at BlackRock, Sothic and Houlihan Lokey declined to comment on the appointments and debt talks. A spokesman at Clifford Chance wasn’t immediately available to comment.

Bank Meeting

Bank lenders including HSBC Holdings Plc and Banco Santander SA appointed financial adviser KPMG and are considering hiring law firm Uria Menendez as legal advisers, people with knowledge of the matter said last week. Banks are holding a meeting with KPMG on Monday, according to people familiar with the matter.

Officials at Santander weren’t immediately available to comment on the advisers or the meeting. A spokesman at HSBC declined to comment.

Abengoa is working with Lazard Ltd. and law firms Linklaters and DLA Piper, people familiar with the matter said last week.

The International Swaps & Derivatives Association said its determinations committee will rule on whether credit-default swaps linked to Abengoa SA have been triggered by a bankruptcy credit event. The committee met on Monday and agreed to continue the discussion on Tuesday.

A decision that an event has occurred will lead to payouts on all contracts, according to ISDA’s rules. A total of 2,814 contracts insuring a net $718 million of Abengoa debt were outstanding as of Nov. 20, according to Depository Trust & Clearing Corp.

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