German companies are now embracing the high yield market.
Issuers can sell bonds with traditional high yield covenants
and terms, structured in either New York or German law,
following the amendment to the German Bond Act.
Before the amendment to the Act, issuers could not demand an
indenture by way of majority votes of the bondholders. Because
of this, the German law was not considered internationally
competitive. The August 2009 amendment changed this, and now
indentures can be provided for by way of majority votes.
As well as allowing amendments to bond terms with majority
bondholder consent, the changes also introduced the idea of a
common bondholder representative.
Continental’s €750 million senior
secured notes in June 2010 were the...