Key issues that typically arise in connection with debt repurchase programs.

By Rob Moulton and Anna Lewis-Martinez

Market shifts often lead companies and their affiliates to actively consider debt repurchases. Important legal considerations include: contractual restrictions; potential disclosure obligations; listing implications; the impact of tender offer rules; consequences of debt purchase transactions; how debt purchase transactions can be structured; potential tax consequences; and jurisdiction-specific considerations.

Companies should carefully consider the issues that can typically arise before launching a debt repurchase program. Whether a company is considering repurchasing its own bonds or loans or those of an affiliate, there are a number of important issues to take into account. Advance planning and proper structuring will help to avoid unexpected consequences and enhance the execution of a repurchase.

For a full briefing on these issues, including those applicable to both bond and loan repurchases, as well as jurisdictional snapshots of issues raised by the United Kingdom, France, Germany, Italy, and Spain, please see Latham’s Client Alert.

The Client Alert is intended to provide general answers that may be useful in planning a debt repurchase program. However, companies and their affiliates and financial institutions should consult with counsel about the facts specific to their circumstances before commencing any such program.