Credit Derivatives Determinations Committee » SABMiller Limited (formerly SABMiller Plc)

Event Publicly Available Information:

Date	Description	Document
6/06/2017 05:30pm EDT	Closed	EMEA DC Decision 06062017 June 6, 2017: The EMEA Determinations Committee (DC) determined that: (i) for the purposes of the 2014 ISDA Credit Derivatives Definitions (2014 Definitions), Anheuser-Busch InBev SA/NV (ABI) became the sole Successor to SABMiller Limited (formerly SABMiller Plc) (SABMiller) on 20 January 2017 pursuant to Section 2.2(a)(i) of the 2014 Definitions; and (ii) for the purposes of the 2003 ISDA Credit Derivatives Definitions (2003 Definitions, and together with 2014 Definitions, the Definitions), each of ABI and Anheuser-Busch InBev Worldwide Inc. (ABIWW) became a Successor to SABMiller, in each case, on 20 January 2017 pursuant to Section 2.2(a)(iii) of the 2003 Definitions). Following the merger between SABMiller and ABI effective on 10 October 2016 (link), ABI undertook a series of actions between November 2016 and January 2017 to reorganize its debt (Debt Reorganisation), as a result of which (i) on 16 December 2016, six series of USD-denominated notes issued and/or guaranteed by SABMiller (SABMiller USD Notes, consisting of two series of Direct Issuance USD Notes and four series of Guaranteed USD Notes, in each case, as defined below) were exchanged for six corresponding series of USD-denominated notes issued by ABIWW and guaranteed by ABI as parent guarantor and various subsidiaries (Subsidiary Guarantors) (link); (ii) on 20 January 2017, certain EUR-denominated notes issued by SABMiller Holdings Inc. and guaranteed by SABMiller (EUR Notes) were substituted for ABI as issuer and ABIWW and Subsidiary Guarantors as guarantors (link); and (iii) on 7 December 2016, certain AUD-denominated bonds issued by FBG Treasury Aust. Pty Ltd and guaranteed by SABMiller (AUD Notes) were exchanged for notes issued by FBG Finance Pty Ltd and guaranteed by ABI. For the purposes of the analysis outlined below, the EMEA DC could not obtain publicly available information in relation to the exchange offer for the AUD Notes or any of the related guarantees, however taking into account the principal amount of the AUD Notes, the AUD Notes would not affect the conclusions below. To determine one or more Successors (if any) to SABMiller for the purposes of the Definitions, the EMEA DC first considered the universe of potential Relevant Obligations of SABMiller and concluded that, for the purposes of Section 2.2(f) of the Definitions, those SABMiller USD Notes issued by SABMiller (Direct Issuance USD Notes) and the EUR Notes would constitute Relevant Obligations of SABMiller. In addition, the guarantees from SABMiller in respect of certain SABMiller USD Notes (Guaranteed USD Notes) would constitute Qualifying Guarantees (and therefore those Guaranteed USD Notes would also constitute Relevant Obligations of SABMiller) under the 2014 Definitions; however the same guarantees from SABMiller would fail to constitute Qualifying Guarantees (and therefore those Guaranteed USD Notes would not constitute Relevant Obligations of SABMiller) under the 2003 Definitions. The discrepancy arises as a result of certain release provisions in the guarantees pertaining to the Guaranteed USD Notes and how those provisions are treated under the 2003 Definitions and the 2014 Definitions. The release provisions provide that a guarantor could be released from its obligations following a sale or transfer by that guarantor of all or substantially all of its assets pursuant to which the transferee expressly assumes SABMiller’s obligations under the guarantee of the Guaranteed USD Notes. The inclusion of such release provisions in a guarantee pursuant to which “the payment obligations of the guarantor can be discharged, reduced, assigned or otherwise altered as a result of the occurrence or non-occurrence of an event or circumstance (other than payment)” would exclude the guarantee from constituting a Qualifying Guarantee for the purposes of the 2003 Definitions. However under the 2014 Definitions, such release provisions would constitute a Permitted Transfer, meaning their inclusion would not, in itself, cause the guarantee to fail to constitute a Qualifying Guarantee. The concept of Permitted Transfer or its equivalent does not exist under the 2003 Definitions. Accordingly, the Relevant Obligations of SABMiller under the 2014 Definitions were the SABMiller USD Notes and the EUR Notes, whereas the scope of Relevant Obligations of SABMiller under the 2003 Definitions was narrower, namely the Direct Issuance USD Notes and the EUR Notes. Under Section 2.2(d) of the 2014 Definitions and Section 2.2(c) of the 2003 Definitions, an entity “succeeds” to Relevant Obligations if it either “assume or becomes liable for such Relevant Obligations” or issues Bonds “that are exchanged for Relevant Obligations” and, in either case, the Reference Entity is not thereafter an obligor (directly or as provider of a Relevant Guarantee) with respect to such Relevant Obligations. Where an entity assumes or becomes liable for a Relevant Obligation as guarantor such guarantee must be a Relevant Guarantee. The EMEA DC considered each group of Relevant Obligations in turn: Direct Issuance USD Notes New notes issued by ABIWW and guaranteed by ABI and Subsidiary Guarantors were issued in exchange for the Direct Issuance USD Notes. The EMEA DC determined that the guarantees provided by ABI are Relevant Guarantees whereas the guarantees provided by the Subsidiary Guarantors are not Relevant Guarantees as a result of certain release provisions in those guarantees. Therefore ABIWW and ABI are potential successors in respect of the Direct Issuance USD Notes. However Section 2.2(h) of the 2014 Definitions clarifies that, where the Relevant Obligation was a direct obligation of the Reference Entity, the Relevant Obligation is succeeded to only by the entity that succeeds as direct obligor (and similarly, if the Relevant Obligation was an obligation of the Reference Entity pursuant to a Relevant Guarantee, the Relevant Obligation is succeeded to by the entity or entities that succeed pursuant to a Relevant Guarantee, unless there is no Relevant Guarantee in which case the entity that is the direct obligor succeeds to the Relevant Obligation). Although there is no equivalent in the 2003 Definitions to Section 2.2(h) of the 2014 Definitions, in the absence of any provisions in the 2003 Definitions providing to the contrary, the EMEA DC determined the same approach should be taken under the 2003 Definitions because the nature of the Relevant Obligation as either a direct obligation of the Reference Entity or a Relevant Guarantee should be considered when identifying who has succeeded to it. Accordingly, the EMEA DC determined that the Direct Issuance USD Notes were succeeded to by ABIWW only. Guaranteed USD Notes New notes issued by ABIWW and guaranteed by ABI and the Subsidiary Guarantors were issued in exchange for the Guaranteed USD Notes. The inclusion of certain release provisions in the guarantees provided by the Subsidiary Guarantors exclude them from constituting Relevant Guarantees, as such only the guarantees provided by ABI are Relevant Guarantees. For the same reasons as discussed above in relation to the Direct Issuance USD Notes, the EMEA DC determined that the Guaranteed USD Notes are succeeded to by ABI only. EUR Notes ABI was substituted for the issuer and ABIWW and Subsidiary Guarantors were substituted for the guarantor. The guarantees provided by ABIWW and Subsidiary Guarantors fail to constitute Relevant Guarantees as a result of certain release provisions in those guarantees. Accordingly the EUR Notes were succeeded to by ABI only. Taking into account the above, the EMEA DC determined that: (i) ABI succeeded to more than 75% of the Relevant Obligations and is the sole Successor to SABMiller under Section 2.2(a)(i) of the 2014 Definitions; and (ii) ABI and ABIWW have each succeeded to more than 25% of the Relevant Obligations and each of ABI and ABIWW is a Successor to SABMiller under Section 2.2(a)(iii) of the 2003 Definitions.
1/24/2017 04:45pm EST	Request Accepted by DC	Pursuant to the standing resolution passed by the EMEA Determinations Committee (DC) on June 21, 2010, the first meeting of the EMEA DC to deliberate the DC Questions relating to this DC Issue has been deferred pending deliberation of such DC Questions by the EMEA DC legal subcommittee. Please refer to EMEA_DC_Standing_Resolution_210610.
1/20/2017 09:55am EST	Pending DC Consent

Date

Description

Document

6/06/2017 05:30pm EDT

Closed

EMEA DC Decision 06062017

June 6, 2017: The EMEA Determinations Committee (DC) determined that: (i) for the purposes of the 2014 ISDA Credit Derivatives Definitions (2014 Definitions), Anheuser-Busch InBev SA/NV (ABI) became the sole Successor to SABMiller Limited (formerly SABMiller Plc) (SABMiller) on 20 January 2017 pursuant to Section 2.2(a)(i) of the 2014 Definitions; and (ii) for the purposes of the 2003 ISDA Credit Derivatives Definitions (2003 Definitions, and together with 2014 Definitions, the Definitions), each of ABI and Anheuser-Busch InBev Worldwide Inc. (ABIWW) became a Successor to SABMiller, in each case, on 20 January 2017 pursuant to Section 2.2(a)(iii) of the 2003 Definitions).

Following the merger between SABMiller and ABI effective on 10 October 2016 (link), ABI undertook a series of actions between November 2016 and January 2017 to reorganize its debt (Debt Reorganisation), as a result of which (i) on 16 December 2016, six series of USD-denominated notes issued and/or guaranteed by SABMiller (SABMiller USD Notes, consisting of two series of Direct Issuance USD Notes and four series of Guaranteed USD Notes, in each case, as defined below) were exchanged for six corresponding series of USD-denominated notes issued by ABIWW and guaranteed by ABI as parent guarantor and various subsidiaries (Subsidiary Guarantors) (link); (ii) on 20 January 2017, certain EUR-denominated notes issued by SABMiller Holdings Inc. and guaranteed by SABMiller (EUR Notes) were substituted for ABI as issuer and ABIWW and Subsidiary Guarantors as guarantors (link); and (iii) on 7 December 2016, certain AUD-denominated bonds issued by FBG Treasury Aust. Pty Ltd and guaranteed by SABMiller (AUD Notes) were exchanged for notes issued by FBG Finance Pty Ltd and guaranteed by ABI. For the purposes of the analysis outlined below, the EMEA DC could not obtain publicly available information in relation to the exchange offer for the AUD Notes or any of the related guarantees, however taking into account the principal amount of the AUD Notes, the AUD Notes would not affect the conclusions below.

To determine one or more Successors (if any) to SABMiller for the purposes of the Definitions, the EMEA DC first considered the universe of potential Relevant Obligations of SABMiller and concluded that, for the purposes of Section 2.2(f) of the Definitions, those SABMiller USD Notes issued by SABMiller (Direct Issuance USD Notes) and the EUR Notes would constitute Relevant Obligations of SABMiller. In addition, the guarantees from SABMiller in respect of certain SABMiller USD Notes (Guaranteed USD Notes) would constitute Qualifying Guarantees (and therefore those Guaranteed USD Notes would also constitute Relevant Obligations of SABMiller) under the 2014 Definitions; however the same guarantees from SABMiller would fail to constitute Qualifying Guarantees (and therefore those Guaranteed USD Notes would not constitute Relevant Obligations of SABMiller) under the 2003 Definitions. The discrepancy arises as a result of certain release provisions in the guarantees pertaining to the Guaranteed USD Notes and how those provisions are treated under the 2003 Definitions and the 2014 Definitions. The release provisions provide that a guarantor could be released from its obligations following a sale or transfer by that guarantor of all or substantially all of its assets pursuant to which the transferee expressly assumes SABMiller’s obligations under the guarantee of the Guaranteed USD Notes. The inclusion of such release provisions in a guarantee pursuant to which “the payment obligations of the guarantor can be discharged, reduced, assigned or otherwise altered as a result of the occurrence or non-occurrence of an event or circumstance (other than payment)” would exclude the guarantee from constituting a Qualifying Guarantee for the purposes of the 2003 Definitions. However under the 2014 Definitions, such release provisions would constitute a Permitted Transfer, meaning their inclusion would not, in itself, cause the guarantee to fail to constitute a Qualifying Guarantee. The concept of Permitted Transfer or its equivalent does not exist under the 2003 Definitions. Accordingly, the Relevant Obligations of SABMiller under the 2014 Definitions were the SABMiller USD Notes and the EUR Notes, whereas the scope of Relevant Obligations of SABMiller under the 2003 Definitions was narrower, namely the Direct Issuance USD Notes and the EUR Notes.

Under Section 2.2(d) of the 2014 Definitions and Section 2.2(c) of the 2003 Definitions, an entity “succeeds” to Relevant Obligations if it either “assume or becomes liable for such Relevant Obligations” or issues Bonds “that are exchanged for Relevant Obligations” and, in either case, the Reference Entity is not thereafter an obligor (directly or as provider of a Relevant Guarantee) with respect to such Relevant Obligations. Where an entity assumes or becomes liable for a Relevant Obligation as guarantor such guarantee must be a Relevant Guarantee. The EMEA DC considered each group of Relevant Obligations in turn:

Direct Issuance USD Notes

New notes issued by ABIWW and guaranteed by ABI and Subsidiary Guarantors were issued in exchange for the Direct Issuance USD Notes. The EMEA DC determined that the guarantees provided by ABI are Relevant Guarantees whereas the guarantees provided by the Subsidiary Guarantors are not Relevant Guarantees as a result of certain release provisions in those guarantees. Therefore ABIWW and ABI are potential successors in respect of the Direct Issuance USD Notes.

However Section 2.2(h) of the 2014 Definitions clarifies that, where the Relevant Obligation was a direct obligation of the Reference Entity, the Relevant Obligation is succeeded to only by the entity that succeeds as direct obligor (and similarly, if the Relevant Obligation was an obligation of the Reference Entity pursuant to a Relevant Guarantee, the Relevant Obligation is succeeded to by the entity or entities that succeed pursuant to a Relevant Guarantee, unless there is no Relevant Guarantee in which case the entity that is the direct obligor succeeds to the Relevant Obligation). Although there is no equivalent in the 2003 Definitions to Section 2.2(h) of the 2014 Definitions, in the absence of any provisions in the 2003 Definitions providing to the contrary, the EMEA DC determined the same approach should be taken under the 2003 Definitions because the nature of the Relevant Obligation as either a direct obligation of the Reference Entity or a Relevant Guarantee should be considered when identifying who has succeeded to it. Accordingly, the EMEA DC determined that the Direct Issuance USD Notes were succeeded to by ABIWW only.

Guaranteed USD Notes

New notes issued by ABIWW and guaranteed by ABI and the Subsidiary Guarantors were issued in exchange for the Guaranteed USD Notes. The inclusion of certain release provisions in the guarantees provided by the Subsidiary Guarantors exclude them from constituting Relevant Guarantees, as such only the guarantees provided by ABI are Relevant Guarantees. For the same reasons as discussed above in relation to the Direct Issuance USD Notes, the EMEA DC determined that the Guaranteed USD Notes are succeeded to by ABI only.

EUR Notes

ABI was substituted for the issuer and ABIWW and Subsidiary Guarantors were substituted for the guarantor. The guarantees provided by ABIWW and Subsidiary Guarantors fail to constitute Relevant Guarantees as a result of certain release provisions in those guarantees. Accordingly the EUR Notes were succeeded to by ABI only.

Taking into account the above, the EMEA DC determined that: (i) ABI succeeded to more than 75% of the Relevant Obligations and is the sole Successor to SABMiller under Section 2.2(a)(i) of the 2014 Definitions; and (ii) ABI and ABIWW have each succeeded to more than 25% of the Relevant Obligations and each of ABI and ABIWW is a Successor to SABMiller under Section 2.2(a)(iii) of the 2003 Definitions.

1/24/2017 04:45pm EST

Request Accepted by DC

Pursuant to the standing resolution passed by the EMEA Determinations Committee (DC) on June 21, 2010, the first meeting of the EMEA DC to deliberate the DC Questions relating to this DC Issue has been deferred pending deliberation of such DC Questions by the EMEA DC legal subcommittee.

Please refer to EMEA_DC_Standing_Resolution_210610.

1/20/2017 09:55am EST

Pending DC Consent