by Thomas Muskett-Ford

Salaverri, Dellatorre, Burgio & Wetzler Malbrán has helped Argentine private equity firm Sophia Capital Partners buy local subsidiaries belonging to debt-laden Brazilian oil and gas valve manufacturer Lupatech.

Pérez Alati, Grondona, Benites, Arntsen & Martínez de Hoz (h) advised Lupatech for the US$22 million transaction, which was signed on 31 October and is awaiting regulatory approval.

Pérez Alati partner Eugenio Aramburu says the deal was particularly demanding as it required the separation of Lupatech′s subsidiaries from their affiliates. Because the segregated companies could not operate on a standalone basis, it was necessary to negotiate supply agreements between the various entities involved, he says. Key personnel also needed to be relocated.

The sale represents 7 per cent of Lupatech′s total asset base and some 17 per cent of its 2013 revenue. The company is thought to have debts of up to US$1 billion and turned to Felsberg Advogados, Machado, Meyer, Sendacz e Opice Advogados and Shearman & Sterling LLP last month for a US$300 million debt-for-equity swap with bondholders – said to be the first extrajudicial restructuring to take place in Brazil involving only foreign bonds.

Latin Lawyer