2014 was an eventful year for Conyers Dill & Pearman. Globally, we received many accolades for our work on complex, high profile transactions. Due in part to our exceptional strength in Bermuda, Conyers was awarded Offshore Law Firm of the Year by Chambers Global. We were also fortunate to receive similar awards from other international law firm directories including IFLR Asia.

Consistent with the Firm's global success, our Bermuda Corporate Practice was universally classified as top tier or leading by all of the major international law firm directories last year. Of particular note, David Cooke and Graham Collis were recognised as elite Band 1 practitioners by Chambers & Partners.

The Bermuda Corporate Practice experienced a marked increase in transactional work in 2014. This was perhaps a reflection of the over 10% increase in the number of Bermuda companies that were incorporated in 2014. Bermuda company incorporations have now increased almost 30% over the past two years and have returned to their highest level since 2008. The increase in "big-ticket" transactional work was led by IPO and securitization matters. Over the past year, Conyers advised all new Bermuda company issuers on listings on the NYSE, Nasdaq and Oslo Stock Exchange. We also advised on award winning asset-backed securitizations raising US$2.4 billion in aggregate. This represents a significant increase on the approximate US$1 billion raised in securitization deals we advised on in 2013. Moreover, 2014 was a year in which Bermuda consolidated its position as one of the world's leading jurisdictions for insurance. Conyers advised on the registrations of 43% of new insurers in Bermuda last year. In particular, it was a banner year for Insurance-Linked Securities ("ILS") listings on the Bermuda Stock Exchange. In 2014, Conyers was lead Bermuda counsel on US$3.75 billion of ILS listings.

We have highlighted some of the transactions that our Bermuda Corporate Practice Group has worked on over the past year to give you a sense of the breadth, depth and diversity of our Bermuda corporate law capability.

We hope you find this annual review insightful and we look forward to working with you in the coming year.

 

GENERAL CORPORATE OVERVIEW

Conyers' Bermuda Corporate Practice Group has developed expertise in complex offshore legal mandates for many of the world's leading companies. In 2014 such mandates included transactions from the IPO, Mergers & Acquisitions and Securitization sectors.

Initial Public Offerings

In 2014, global IPO volume totalled US$257.7 billion, up 49% from 2013. This, together with the largest increase in the US IPO market since 2000, led to a significant rise in activity for our Bermuda IPO/public companies practice, which advises more than half of the Bermuda companies listed on the NYSE and Nasdaq.

The graphic below illustrates the value (by amount of new capital raised) of IPOs for Bermuda companies listed on the NYSE and Nasdaq over the last five years. Conyers advised on every Bermuda public company listing on these exchanges in 2014, resulting in just over US$3 billion of new capital. Two key transactions are featured below.

Markit

In June, Conyers advised Markit Ltd. ("Markit") on its ten times oversubscribed US$1.3 billion initial public offering and listing on the Nasdaq Global Select Market, which was the ninth largest US IPO in 2014. Markit is a leading global diversified provider of financial information services.

Travelport

Conyers also advised Travelport Worldwide Limited ("Travelport") on its September IPO which raised US$480 million. Travelport provides a principal travel commerce platform to the world's leading travel providers such as airlines, hotel chains and offline travel agencies.

MERGERS & ACQUISITIONS

Energy XXI/EPL
Conyers advised EPL Oil & Gas, Inc. ("EPL") in its acquisition by Energy XXI Limited ("Energy XXI"), creating the largest publicly traded independent oil and gas producer on the Gulf of Mexico Shelf. Energy XXI acquired EPL's outstanding shares for total consideration of US$2.3 billion, including debt assumption, cash and approximately 23 million common shares of Energy XXI.

Nabors Industries
Conyers acted for Nabors Industries Ltd. on its merger with C&J Energy Services Inc. ("C&J"), valued at US$2.86 billion. This transaction, when completed in 2015, will create one of North America's largest oil and natural gas completion-and-production-services operations.

Securitization

In 2014 Conyers advised on a number of asset-backed securitization transactions. Bermuda continues to be a preferred jurisdiction for offshore securitization. Over the past year or so, Bermuda has played a significant role in theresurgence of aircraft lessor securitizations.

Castlelake

Conyers advised Castlelake in connection with its US$515.6 million aircraft securitizationin February. The proceeds from the deal were to be used to purchase 79 aircraft and associated aircraft-owning entities (initially leased to 26 lessees located in 17 countries). The deal was awarded Overall Deal of the Year by the Aviation 100 Awards. Castlelake is an institutional alternative investment firm, specialising in aircraft.

 

INSURANCE

Insurance-Linked Securities ("ILS") continue to dominate Bermuda's insurance industry, which altogether now make up 57% of the global ILS industry. In Bermuda, we have experienced the increasing use of reinsurance sidecar vehicles and cat bonds, popular not only with the reinsurers who utilize them but also with the investors - particularly hedge funds - who invest in these vehicles. In the third quarter of 2014, all new deals globally were, for the first time, issued exclusively by Bermuda special purpose insurers ("SPI's") (entities specifically formed for these ILS structures). Conyers increased its share of SPI registrations to 46% in 2014 (see graphic below).

Increasing SPI Registrations

In addition to SPI registrations, Conyers has also been a leader advising on the influx into Bermuda of new hedge fund backed Class 4 insurers, segregated account ILS funds and new innovative life annuity and macro-longevity structures, an area where further growth is expected. Conyers was also the only Bermuda firm to advise on the registration of Class E long-term reinsurer registrations in 2014.

Conyers continues to support many clients in the captives market in Bermuda and was named Offshore Law Firm of the Year in 2014 US Captive Services Awards, organised by Captive Review. With the Firm's expertise in this area, we have seen a significant rise in activity, having increased our work in Class 1 captive registrations by 54% last year.

ASPEN INSURANCE'S SUCCESSFUL DEFENCE OF ENDURANCE SPECIALTY HOLDINGS' TAKE-OVER BID

One of the year's most notable matters was the successful defence by Aspen Insurance Holdings Ltd. (Nasdaq: AHL) of a US$3.2 billion take-over bid by Endurance Specialty Holdings Ltd. (NYSE: ENH). Endurance first made an offer for Aspen in April and raised its bid in June. In April, Aspen adopted a one year shareholder rights plan (poison pill), which significantly increased the cost of Endurance's bid unless Aspen's board approved it.

Aspen has a staggered board, with about a third of its directors up for election each year. Endurance asked Aspen shareholders to call a special meeting to consider increasing the size of Aspen's board - which would have meant that a majority of the directors would be up for election at the 2015 annual general meeting—and to authorise support of a court-ordered meeting of Aspen shareholders to consider and vote on a scheme of arrangement under Section 99 of the Companies Act 1981, in an attempt to bypass the board approval requirement and consequently effect a takeover by way of the scheme.

More than three quarters of Aspen shareholders did not support either Endurance proposal. As a result, Endurance withdrew its offer before any court action was taken leaving open the question of whether the court would have directed that a scheme meeting be convened in the manner proposed by Endurance.

 

TRANSPORTATION

Shipping

Activity in the shipping industry showed no signs of slowing down this past year. Conyers represents many ship owners and lenders on the cross-border aspects of their transactions. Globally, Conyers was awarded two Marine Money honours for deals completed by our Bermuda and Hong Kong offices. We continue to be a leader in the ship finance and shipping capital markets space, particularly in the Norwegian market.

Avance Gas

Conyers advised Avance Gas Holding Ltd. on the Bermuda law aspects of its initial public offering ("IPO") and listing on the Oslo Stock Exchange in April 2014. Avance offered US$100 million of new shares in the IPO and existing selling shareholders sold a combined US$150 million of their shares in the IPO. Conyers has advised all of the new Bermuda shipping company issuers who have listed on the Oslo Stock Exchange over the past two years.

GasLog

Conyers also advised GasLog Partners LP on its US$186 million initial public offering on the NYSE in 2014. The proceeds from the offering were used principally to reduce indebtedness and for general corporate purposes, with the remainder distributed to GasLog Ltd. GasLog is an international owner, operator and manager of LNG carriers.

Aviation

Conyers offers specialist expertise in aviation matters, ranging from the incorporation of single aircraft owning companies advising on the structuring of innovative corporate vehicles, in the context of aircraft financing. The Firm's aviation industry clients include a number of aircraft lessors such as Aircastle Limited, AerCap B.V., Avolon and Castlelake. The Firm also acts for several airlines and private clients registering both commercial and private aircraft.

Aercap/Genesis

In April, Conyers advised AerCap Holdings N.V. in connection with the sale by its wholly-owned subsidiary, AerCap International Bermuda Limited, of 100% of the Class A common shares in Genesis Funding Limited ("Genesis") to an affiliate of Wood Creek Capital Management, LLC. Genesis is a Bermuda incorporated aircraft securitization vehicle with a portfolio of 37 aircraft valued at approximately US$750 million.

CIT

In July, Conyers advised CIT Group Inc. on its Bermuda aircraft securitization structure, CIT Aviation Finance III Limited, involving the issue of US$640 million in Class A-1 notes backed by payments pursuant to operating leases and disposition proceeds on a portfolio of 28 aircraft manufactured by Airbus, Boeing and Embraer.

Azerbaijan

Conyers liaised with the Bermuda Department of Civil Aviation on reactivating the 83 bis agreement with Azerbaijan and acted as Bermuda counsel on the subsequent transactions financing aircraft to be operated by two separate Azerbaijan airlines, one for two (2) Boeing 747-8Fs and the other for two (2) Boeing B787-8s.

 

FUNDS

Bermuda is experiencing a revival in private equity and traditional fund incorporations and launches as a result of the amendments to the Investment Funds Act enacted at the end of 2013. Conyers has been actively engaged in setting up new classes of exempted funds pursuant to the new legislation. We have also lent expertise and have acted as speakers and moderators during the Regulatory Compliance Association symposiums and have partnered with the Bermuda Business Development Agency to market Bermuda funds in key regions globally.

Highlighted Transactions

In 2014 Conyers advised a leading global firm on the formation of three Bermuda private equity funds which, together with their newly formed Delaware side-by-side funds, raised in excess of US$8 billion for investment in real estate, equity, credit and other financial assets.

Conyers assisted a UK investment advisory company with more than US$40 billion under management to redomicile its segregated portfolio professional fund from the British Virgin Islands into Bermuda.

We also advised a client on a structure using Bermuda limited partnerships to raise US$2 billion for investment in European distressed property debt. The deal represented the biggest deal of its kind in Europe in 2014.

 

TRANSACTIONS

Other Notable Transactions

  • North Atlantic Drilling Limited (NYSE:NADL) completed Fixed Income Offering in the amount of US$125 million; and launched a US$600 million offering of five-year (non-call life) senior notes via joint bookrunners Goldman Sachs, Credit Suisse, and Morgan Stanley. (January)
  • Aircastle Limited (NYSE:AYR) offered an aggregate principal amount of US$500 million of its 5.125% Senior Notes due 2021. (March)
  • Watford Re Ltd. launched with US$1.13 billion of capital, as a Class 4 insurer. (April)
  • Odfjell Drilling Services Ltd. entered into a $450 million senior secured credit facility agreement with Danske Bank A/S and DNB Bank ASA as Coordinators, and Danske Bank A/S, DNB Bank ASA, Nordea Bank Norge ASA and Swedbank AB (publ) as Mandated Lead Arrangers. (May)
  • Helen of Troy Limited (NasdaqGS:HELE) entered into a certain Fourth Amendment to Credit Agreement with Bank of America, N.A., increasing the unsecured revolving commitment of the Credit Agreement from US$375 million to US$570 million. (June)
  • Nordea Bank Norge ASA completed a US$1.5 billion facility to Seadrill Limited (NYSE: SDRL) to finance the acquisition of Ultra-Deepwater Rigs West Saturn, West Neptune and West Jupiter. (June)
  • Kosmos Energy Ltd. (NYSE:KOS) announced the pricing of its previously announced private offering to eligible purchasers of US$300 million aggregate principal amount of its 7.875% senior secured notes due 2021. (July)
  • Textainer Group Holdings Limited (NYSE:TGH) ("Textainer"), the world's largest lessor of intermodal containers, completed a $1.2 billion warehouse securitization facility in connection with the refinance by Textainer Marine Containers II Limited, an indirect, wholly-owned subsidiary of Textainer. (September)
  • FLY Leasing Limited (NYSE:FLY) announced the pricing of US$400 million aggregate principal amount of senior unsecured notes, consisting of US$75 million aggregate principal amount of 6.750% senior notes due 2020 and US$325 million aggregate principal amount of 6.375% senior notes due 2021. (September)
  • Actavis Plc. (NYSE:ACT) completed a US$66 billion acquisition of Allergan Inc. (December)
  • Global Container Assets 2014 Limited and GCA2014 Holdings Limited offered in aggregate US$414 million in Fixed Rate Secured Container Equipment Notes. (December)

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