White & Case attorneys lead $3.2 billion construction project
The Deal: Viana and Sean Goldstein headed a team of White & Case attorneys who helped two companies jointly launch construction of a polyethylene manufacturing complex in Mexico with $3.2 billion of financing from 17 lenders.
Details: White & Case has been the international legal adviser to a joint venture formed in 2010 by Brazil's publicly held Braskem, a longtime commercial client, and Grupo Idesa, a leading petrochemical company in Mexico. Sao Paulo-based Braskem has plants in Brazil, Germany and the United States, and it ranks in the Americas as the largest producer of such thermoplastic resins as polyethylene, polypropylene and polyvinyl chloride.
The joint venture Braskem Idesa closed its $3.2 billion senior financing agreement Dec. 19 with 10 commercial banks and seven public agencies. The 17 lenders are funding most of the $4.5 billion cost of developing, designing and building the polyethylene manufacturing complex, known as Etileno XXI, scheduled to open in the first half of 2015.
"It's been a huge, huge undertaking. We've had a total of 40 lawyers in seven offices involved," Viana said, citing the complex legal structure of the project. "Everything is custom-tailored. ... There's nothing here that's cookie-cutter."
The $4.5 billion project cost makes it the largest with private-sector sponsors in Mexico's history, and the $3.2 billion financing is the biggest on record for a petrochemical plant in the Americas, according to Sumitomo Mitsui Banking, which served as financial adviser to Braskem Idesa.
Most of the White & Case attorneys who worked on the project are based in Miami, like Viana, and Mexico City, like Goldstein. They tapped the specialty expertise of White & Case attorneys in Abu Dhabi, Germany, London, New York and Washington. The core team in Miami included lawyers Victor Mendoza, Jeannine Acevedo, Donal Luna, Thomas Pate, Amelia Rendeiro and Lauran Guijarro.
"I had more involvement on the financing and investment angles," Viana said, describing his co-leadership role with Goldstein. "He got more involved in the contracting and construction side of things."
Etileno XXI will consist of a plant that turns ethane gas to ethylene and three polymerization plants that convert ethylene to polyethylene. The complex will be built in Nanchital in the southwestern Mexican state of Veracruz, where the joint venture partners see potential for possible discoveries of oil and gas reserves.
White & Case lawyers helped Braskem Idesa negotiate a long-term supply agreement with Pemex, the state-owned oil and gas monopoly in Mexico, which will supply the ethane gas.
"This will be the first private petrochemical project to which they are supplying ethane," Viana said, referring to one of the unusual circumstances that added to the challenges of building the legal structure of the project. "The ethane to produce the ethylene is not currently being productively used by Pemex. So their ability to sell this product to Braskem Idesa for this purpose is a huge windfall for Pemex."