Find Lawyers in Madrid, Spain for Structured Finance Law

Legal advice in connection with complex financial transactions is designed on a case-by-case basis for corporations with very specific financial needs that cannot be satisfied with more traditional and standardized products. They usually combine lines of credit with contributions by other parties (equity, mezzanine) and entail a certain degree of risk, which is covered by the implementation of security packages. Some examples of structured finance products include collateralized bond obligations, collateralized debt obligations, public supported transactions, and synthetic financial instruments, which are often combined to optimize the expected profitability of the overall transaction.

Different parties participating in the transactions may require legal advice, including the following:

(i)  Mandated Lead Arrangers and other financing parties: they provide lines of credit to the borrowers and the legal advice typically required includes ensuring that the security package obtained sufficiently protects the borrowers’ repayment obligations from a legal perspective.

(ii)  Equity/mezzanine investors: they provide subordinated financing in exchange of higher profitability arising from credit rights, tax savings, or other sources. The legal advice typically required includes a review of the legality of the structure to be implemented, including the issuance of legal and tax clean opinions addressed to the investors and the implementation of measures to limit the risk of their investments without being detrimental to their expected profitability and the implementation of proper mechanisms to protect their interests without detrimental of those of the senior financiers.

(iii)  Borrowers: they obtain funds to be used for projects, operations, business expansion, or other purposes. The legal advice typically required includes analysis of the implications of their participation in the transaction from a legal perspective and the review of the conditions and obligations that are being offered in order to ensure that they will be able to receive the needed funds in time and form and that they will still be able to run their business in an operational manner, as well as that the limitations required by other participants are not detrimental to their business expectations.

Structured finance transactions are often cross-border deals that require legal advice in more than one jurisdiction.

Depending on the type of structure that requires legal advice and the outcome of its implementation, several areas of the law may be covered, including financial, tax, public, corporate/commercial, procedural, bankruptcy, aviation, and maritime law.