Chadbourne & Parke LLP represented the International Bank for Reconstruction and Development (IBRD), member of the World Bank Group, in its issuance of guarantees in support of Naftogaz, the state energy company of Ukraine. At Ukraine's request, the IBRD established a guarantee facility, in the euro equivalent of US$500 million, for the lenders in order to support Naftogaz's purchase and importation of natural gas from various eligible gas suppliers. Citibank, N.A. and Deutsche Bank AG acted as mandated lead arrangers, along with Citibank Europe plc, UK Branch as the agent, Citibank, N.A., London Branch as the offshore reserve account bank, and Oschadbank as the onshore revenue account bank. The transaction is supported by an indemnity agreement between the Ministry of Finance of Ukraine and IBRD.
The Naftogaz transaction represents the World Bank's largest-ever guaranteed letter of credit facility and its first guarantee of a trade finance transaction.
The transaction is intended to ensure the security of Ukraine's gas supply through the winter. Under this trade finance facility, Naftogaz will be able to improve its payment terms for gas purchases, shifting from a pre-payment to a post-payment model when purchasing gas.
This innovative and complex project played to Chadbourne's strengths in the agency finance arena and represented a strategically important project to the World Bank Group. The IBRD is a global development cooperative owned by 189 member countries. As the largest development bank in the world, IBRD provides loans, guarantees, risk management products and advisory services to middle-income and creditworthy low-income countries, as well as coordinates responses to regional and global challenges.
The Chadbourne team was led by partner Ken Hansen, with support from international counsel Jan Peter Weiland and international attorney Shalini Soopramanien.
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For more than a century, Chadbourne & Parke LLP has counseled innovators around the world. We are a full-service law firm that leverages the extraordinary talent from our network of international offices to offer the highest caliber client service in more than 80 countries and across every region on the globe. Today, we are recognized internationally for our groundbreaking work in emerging economies and our deep experience in pharmaceutical collaboration transactions, energy and infrastructure, corporate and finance transactions, international disputes, and bankruptcy and financial restructuring.