Linklaters advises HSH owners on an agreement on key points with Brussels

Frankfurt, 19 October 2015. Linklaters advises the owners of HSH Nordbank AG, the Free and Hanseatic City of Hamburg and the German Land of Schleswig-Holstein in the state aid procedure of the European Commission. Today, the German Länder agreed with the European Commission on the key terms for a final approval to re-increase the risk shield to 10 billion euros. The open state aid procedure can thus be finalised after intensive negotiations.

According to the agreement, the bank may sell distressed portfolios in the amount of more than 8 billion euros; up to 6.2 billion euros of this amount may be sold to the German Länder, the rest to the market. This enables the bank to transfer a significant part of its legacy issues in particular in the area of ship financing to third parties.

Furthermore, HSH Nordbank AG will be split into a holding company and an operating subsidiary. The latter will continue the operating business and will be granted a significant relief regarding the existing premium obligations in the context of the Sunrise Guarantee.

Finally, the subsidiary will be privatised by way of an open, transparent and competitive procedure after a definitive decision and implementation of the measures.

The implementation of the decision still requires the approval of the governments and parliaments of the Free and Hanseatic City of Hamburg and of the German Land of Schleswig-Holstein.

A Linklaters team led by Andreas Steck (Financial Regulation Group, Frankfurt) and Dr Jan Endler (Public Law, Berlin) advises on the matter. The team also includes Dr Thomas Nießen (Corporate, Düsseldorf), Dr Detlev Schuster (of Corporate, Berlin), Kristina Zych (Public Law, Berlin), Andreas Dehio (Financial Regulation Group, Frankfurt), Rico Kaßmann, Anne Dreessen (both Public Law, Berlin), Simon Staude and Britta Diel (both Financial Regulation Group, Frankfurt).