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Practice/Industry Group Overview
Jones Day's Energy Delivery & Power team, together with our Capital Markets team, is continually involved in corporate finance transactions. We have assisted clients in public and private offerings of debt and equity securities, project finance transactions, synthetic and leveraged leases, secured and unsecured bank credit facilities, and derivative financial products. We also assist our energy delivery and power clients with SEC compliance issues.
Our experience in corporate finance matters for utility clients reaches back to the early 20th century. For decades, we routinely acted as counsel to issuers and underwriters in traditional offerings by electric and gas utilities of first mortgage bonds, fixed rate preferred stock, and common stock. As changes occurred in the industry, necessitating more flexibility and, in some cases, the disaggregation of vertically integrated utilities, we were instrumental in assisting many of our clients in modifying and eventually discharging their first mortgage indentures and amending their articles of incorporation to allow the issuance of more modern equity products. Over the last several decades, we have participated as issuer's or underwriter's counsel for several energy delivery and power clients in all of their significant public and private offerings of taxable and tax-exempt securities (including fixed and floating rate preferred stock, common stock, first mortgage bonds, secured and unsecured senior notes, medium-term notes, pollution control bonds, and trust preferred securities). Significant transactions for these and other clients include representation of Ameren Energy Generating Company in a $425 million Rule 144A/Regulation S registered exchange offer of debt secured by a portfolio of generation assets; the underwriters in a $640 million public offering of common stock and 8.50% equity units by ONEOK, Inc.; a subsidiary of El Paso Corporation in a $950 million offering of senior secured notes in a Rule 144A/Regulation S offering; Kentucky Utilities Company in a $50 million tax-exempt pollution control financing; Oklahoma Gas and Electric Company in a public offering of $140 million of senior notes; and Northern States Power Company in a public offering of $375 million of first mortgage bonds.
The American Lawyer and Infrastructure Journal have each ranked Jones Day as one of the leading project finance firms in the world. The Firm's project finance experience includes the development of thermal combined-cycle and cogeneration facilities, renewable energy plants, related merchant sales and tolling arrangements, and traditional power purchase agreements. Our clients have included El Paso Corporation, AEP, BP, Singapore Petroleum, Ameren, and South Carolina Electric & Gas. We also represent a number of banks and financial institutions, such as Citibank, JPMorgan Chase, Bank of Tokyo Mitsubishi, WestLB, The Royal Bank of Scotland, and Ambac, in project and structured financings. Recent notable transactions include representing AEP as sponsor of the $121 million Desert Sky Wind Farm, named "North America Renewables Deal of the Year" by Project Finance magazine; The Royal Bank of Scotland as lender to the 300 MW FPL Van Cycle Wind Farm, the largest wind farm in the world; Ambac as monoline insurer in the $302 million project financing of 11 combustion turbine peaking plants with a combined capacity of 495 MW at nine sites in northern California; and Unión Fenosa as sponsor in the financing of the $600 million Tuxpan III & IV 1,000 MW gas-fired power generation facility in Mexico.
The Firm's lease financing practice involves U.S. and cross-border financings, with emphasis on providing greater economic benefits for our clients, both lessors and lessees. Our lease transactions have involved various types of assets, including rail equipment, power plants, oil production facilities, gas processing facilities, and interstate pipeline systems. Our lawyers also have extensive experience in the use of synthetic and leveraged lease structures for project financing and in specialized areas such as turbine construction facilities and other construction and bridge financing transactions. Recent notable transactions include: (i) a $200 million securitization and synthetic lease financing facility for gas pipeline compressors and related lease receivables for a major energy-industry compression services company; (ii) two separate synthetic lease transactions, each involving the construction of combustion turbines, financed through commercial paper conduits; and (iii) synthetic lease of railcars and subsequent refinancing.
Another core service of the corporate finance lawyers within the Energy Delivery & Power team is the representation of borrowers and issuers of securities in a wide range of bank-related transactions, including secured and unsecured loans and loan syndications, letters of credit and other credit enhancements, structured receivable arrangements and asset-backed securities, and acquisition financing and equity participations. We have represented numerous power and utility clients in their revolving and term loan or other bank credit facilities (including amendments and renewals) and recently represented El Paso Corporation in a secured financing resulting in a new $3 billion revolving credit facility and the restructuring of eight existing financings aggregating $2 billion with shared collateral and related intercreditor agreement.
As part of our corporate finance services, we offer advice on derivative financial products. The market for derivatives has grown in recent years, and our lawyers have developed and documented the full range of transaction types, including ISDA form swaps, hybrid and structured notes, swaptions, and related instruments. We regularly advise utility, nonutility, and trading companies on issues under ISDA Master Agreements relating to interest rates and commodity transactions, including electricity, natural gas and, more recently, the use of derivative transactions by a pension trust to hedge risk and enhance returns. Our lawyers have also represented clients in a number of derivative-related and commodity trading disputes, including claims arising out of the Enron bankruptcy.
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