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Clients rely on our Finance Group to help them navigate the business and legal complexities of novel and multi-dimensional debt financing transactions. Our versatile finance practitioners work closely with our mergers and acquisitions, securities, tax, real estate and bankruptcy lawyers to provide seamless advice and innovative solutions that address our clients' debt financing needs related to all types of transactions and capital structures.

Coinstar Closes Innovative $900 Million Whole Business Securitization

Paul, Weiss represented Apollo portfolio company Coinstar, LLC in connection with a first-of-its-kind $900 million whole business securitization of its coin exchange business. Coinstar Funding, LLC issued securitization notes, rated BBB by Kroll and Morningstar, which, among other things, enabled the company to refinance its existing indebtedness and return cash to shareholders. Guggenheim Securities acted as sole structuring advisor and representative of the several initial purchasers of the notes.

The Coinstar transaction was a novel securitization transaction because of the unique nature of the assets and the operating business. The Coinstar assets that were securitized included coin kiosks, intellectual property (including proprietary software and patents related to coin counting and sorting), contractual arrangements with retailers and stored value card providers and international royalty payments. In contrast with a traditional securitization, where the securitized cash flows are payments by contractually obligated parties, the main securitized cash flow in this transaction was Coinstar’s profit margin on the coins deposited into kiosks by the general public. Paul, Weiss worked closely with Guggenheim Securities to craft a unique cash flow structure and cash management arrangement that allowed Coinstar to continue to operate its business as usual, but was also acceptable to rating agencies and attractive to investors.

The Paul, Weiss team included financing partner Jordan Yarett; securities partner Brian Janson; intellectual property partner Claudine Meredith-Goujon; tax partner Brad Okun; and bankruptcy partner Alice Eaton.

May 12, 2017

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