MTC Trust flies high with Kenya Airways

Madabhushi Soundararajan
04 January 2018

Nairobi based MTC Trust cemented its place as the corporate trustee of choice in Kenya during 2017.

The choice of an East Africa based, skilled and experienced trust and corporate specialist has, until recently, been limited to just a few names. MTC has changed this, having firmly established its competence in this branch of trust work drawing on the strength and depth of its Nairobi based team combined with the international fiduciary experience of the Minerva group. This has allowed MTC to advise on complex transaction structuring, delivering exemplary service which has been widely praised by transaction advisory teams.

A case in point is MTC’s recent involvement in the complex debt exchange scheme of Kenya Airways, the national airline. This resulted in the debt of approximately US$ 227 million owed to Kenyan lenders by Kenya Airways being exchanged for equity through Kenya Lenders Company Limited, an SPV incorporated by MTC Trust for this purpose.

MTC led Minerva group’s involvement in the transaction and acts as the security trustee and administrator of the SPV and coordinates trading of the shares working in close coordination with the facility agent, the custodian and the Central Depositary. The SPV is owned by a Mauritius based Purpose Trust of which Minerva in Mauritius are Trustee, and through this SPV, the trust holds approximately 38% of the shares in Kenya Airways Limited, the listed entity on Nairobi Securities Exchange, for the benefit of the Kenyan lenders.

This was a high profile transaction that saw MTC grow in stature in corporate and professional circles. MTC won the mandate through a professional tender process and worked tirelessly with best in class management consultants such as PJT Partners in London and legal advisors in multiple jurisdictions including the UK office of White & Case, Bowmans in South Africa and Kenya, and Hamilton, Harrison & Mathews in Kenya. MTC’s role involved providing advice on the incorporation of the SPV, structuring the ownership through a Mauritius based Purpose Trust and providing input on the voluminous transaction documents covering fifteen different agreements.

This is a ten year corporate trustee assignment and demonstrates how MTC Trust has proved its credentials and is ready to take on the best and brightest competitors for this genre of trust work.

For more information concerning MTC Trust and the corporate and other services the Minerva group provides in East Africa please contact M Soundararajan (Soundy), Kainda Gitonga or Eric Kariuki at MTC in Nairobi.


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