Hogan Lovells advise Citi and Piraeus Bank in a securitization of Greek auto-lease receivables

London, 5 October - Hogan Lovells represented Citi and Piraeus Bank as Arrangers and Joint Lead Managers in a 186 million euros securitization by Cronus Finance Designated Activity Company of a portfolio of Greek auto-lease receivables and residual value claims from Greek SME and corporate borrowers.

The receivables were originated by Olympic Commercial & Tourist Enterprises Single Member S.A which is owned by a consortium consisting of Koc Holding (60%) and Avis Budget Group (40%)). Olympic trades under the name Avis Budget Greece but its rental car business is outside the scope of the transaction. The transaction includes an 18-month revolving period after closing, subject to early amortisation events. The proceeds are being used to modernise its fleet of vehicles with electric and hybrid vehicles.

The Class A Notes were rated BBB+ by Fitch and S&P and were listed on the Irish Stock Exchange. The transaction was privately placed with a group of European supranational institutions.

To date, this is the largest non-banking securitization transaction to have taken place in Greece, and the first securitization transaction since 2010 to achieve an investment grade rating from two major rating agencies.

The transaction involved a fully-developed back-up servicing arrangement with QUALCO Information Systems S.A and a cash reserve to ensure the ongoing performance of the maintenance obligations under the relevant lease agreements in the event of Olympic's insolvency.

The Arrangers and Joint Lead Managers were advised by Hogan Lovells as to English law, Bernistas Law as to Greek law. The originator and investors were each represented by Greek and English counsel.

The Hogan Lovells team was led by Structured Finance partner Julian Craughan with support from David Palmer (counsel), Sebastian Oebels (senior associate), Steven Minke (associate). Tax support was provided by partner Philip Harle and Natasha Newey (associate).

Commenting on the deal, Julian Craughan said: "We are delighted to have advised Citi and Piraeus on this landmark Greek securitization transaction. This deal underscores the resilience of the European securitization markets despite of the continuing uncertainty around COVID-19 and the developing trend of European lease securitization transactions which include residual value claims".

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