Bank of Communications contributes to a $910 million USD syndicated loan to facilitate HNA Group's acquisition of Swissport International Ltd. (Linked to Record ID#101420, #101421, and #101422)

Project narrative

On July 30, 2015, Chinese conglomerate HNA Group Co., Limited entered into a share purchase agreement with PAI Partners — a leading European private equity firm — to acquire all of the issued and outstanding capital stock of Aguila 2 S.A., the parent of Aguila 3 S.A., the sole shareholder of Swissport International Ltd. — a Switzerland-based ground and cargo handling company — by HNA Group Co., Limited for a total transaction value of fr.2.73 billion CHF (approximately $2.8 billion USD). On January 26, 2016, a syndicate of four lenders — the Industrial and Commercial Bank of China (ICBC), the New York Branch of the Agricultural Bank of China Limited (ABC), the Bank of China (Hungary) Close LTD. (BOC Hungary), and Bank of Communications Co., Ltd. (BoComm), acting through its Offshore Banking Unit — entered into a $910 million USD syndicated loan agreement with HNA Aviation (Hong Kong) Ground Handling Holdings Co., Limited — a Hong Kong-incorporated special purpose vehicle (SPV) owned by HNA Group Co., Ltd. — for the acquisition of Swissport International. HNA Group and Grand China Air acted as guarantors for this loan. On January 27, 2016, for security (collateral) HNA Group Co., Ltd. pledged the share capital of Luxembourg-incorporated Swissport Group S.à r.l., a wholly-owned subsidiary of HNA Aviation (Hong Kong) Ground Handling Holdings Co., Ltd., the share capital of Swissport Investments S.A., a wholly-owned subsidiary Swissport Group S.à r.l., and Luxembourg-incorporated Aguila 2 S.à r.l. (the former Aguila 2 S.A.), a wholly-owned subsidiary of Swissport Investments S.A. Record ID#101420 captures ICBC's contribution. Record ID#101421 captures ABC's contribution. Record ID#101422 captures BOC's contribution. Record ID#101423 captures BoComm's contribution. ICBC served as mandated lead arranger, bookrunner, and underwriter. The Yangpu Branch of ICBC served as agent and security agent. The acquisition was closed on February 10, 2016. This was reportedly the largest overseas mergers & acquisition (M&A) in China's aviation industry in recent years. According to Bloomberg, it is the fifth-largest Europe by a Chinese company. The acquisition was expected to help HNA expand its aviation, airport management, logistics, and tourism businesses globally. In May 2017, Swissport International announced that it was in technical default on several of its senior debt facilities, including a €660 million EUR senior secured credit agreement signed on January 20, 2016, after it became aware that HNA Group had pledged the share capital in Swissport Group S.à r.l., Swissport Investments S.A., and Aguila 2 S.à r.l. as collateral for the $910 million USD syndicated loan accrued by HNA Aviation (Hong Kong) Ground Handling Holdings; HNA Group had not informed Swissport that the shares had been pledged until it had discussions with HNA Group about the latter making an equity injection. As this breached lien covenant provisions in the €660 million EUR senior secured credit agreement, this marked an event of default. Furthermore, it forced Swissport to delay publications of its full year 2016 results, leading to a technical default on its €400 million EUR senior secured and €280.5 million EUR senior unsecured bonds that were issued in December 2015, which required the group to publish those results no later than 120 days after the previous fiscal year end. This led Swissport to work on debt restructuring to ensure the structural seniority of the credit facility and bonds over the $910 million USD facility while preserving the $910 million USD's facility collateral package