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December 12, 2008 5:50 AM

Dealmakers of the Week: Shearman & Sterling's Cynthia Urda Kassis & Manuel Orillac

Posted by Julie Triedman

It isn't often that project finance lawyers get to hear their work called "historic." But when the deal involves the Panama Canal, that word gets thrown around a lot--and with good reason. So important has the 97-year-old canal been to global trade that the size of ships are described in relation to the canal's capacity: "Panamax" ships fit through the canal's locks; "post-Panamax" ships, like the new supercarriers from Asia, do not.

Hence the canal expansion plan of the Panama Canal Authority (ACP). On Tuesday, ACP came much closer to realizing its goal. In spite of the credit turmoil and a global recession, five major multinational agencies closed on a deal to provide the authority with $2.3 billion for the project; ACP is self-funding the rest of the $5.3 billion project.

Critically, the authority, a public-private entity that operates and manages the canal, is not mortgaging the landmark to get the loan, and the lenders cannot claim the canal as collateral under the terms of the deal.

The expansion has involved multiple teams of lawyers and bankers. Two years ago, the authority chose Mayer Brown to negotiate the procurement contracts. (That firm's work led to Mayer Brown's Barry Machlin being anointed a "Dealmaker of the Year" in The American Lawyer's April 2008 issue.) The authority also asked five firms to pitch their services as finance counsel. Shearman & Sterling was selected.

Urda_kassis_c_2 ACP considered a range of financing alternatives. In this, Shearman's pitching team--partner Cynthia Urda Kassis, 50, and Manuel Orillac, 48--played a key role. Urda Kassis (pictured right), cohead of the firm's project development and finance practice, is most experienced in private sector project finance; Orillac (below, left) focuses on capital markets. Shearman also has a track record of project finance work in the region.

For most of the first year, the two Shearman lawyers, together with bankers at the authority's financial advisor Mizuho Corporate Bank, examined alternative sources of funding and presented the project to international lenders. Ultimately the authority settled on agency lenders this past spring; they include the International Finance Corporation, the Inter-American Development Bank, and the Andean, European, and Japanese development banks. 

Orillac_m The two lawyers were co-equals on the deal. Urda Kassis took the lead on structuring, negotiating, and documenting the terms of the loan, while Orillac, among other things, led discussions with the rating agency, Moody's. The two helped the authority align its regulations and procedures with those of the lenders. Ultimately, based on the strength of its finances and its independence from the Panamanian government, Moody's would give the authority a credit rating two notches above the country's own rating, "which is almost unheard of," notes Urda Kassis.

In a testament to their work, the deal closed on time and without major alterations in  terms. "I'm sure [Shearman's Urda Kassis and her counterpart at Mayer Brown] know more about Panama Canal law than any Panamanian lawyer outside of the [authority's] in-house lawyer," Diego Herrera Dutari told The American Lawyer last spring.

"To me what distinguishes this is that it is part of history," says Urda Kassis. "There's only one Panama canal. It's one of the modern marvels of the world."


Dealmaker of the Week is published Fridays in The Am Law Daily.

Weil Gotshal's Lori Fife, 12/5/08

S&C's Frank Aquila, 11/21/08

Verizon's John Thorne, 11/7/08

George Kahale and Eric Gilioli of Curtis, Mallet-Prevost, 10/31/08

Gilbert + Tobin's Gina Cass-Gottlieb, 10/24/08

Davis Polk's Diane Kerr, 10/17/08

Slaughter and May's Nigel Boardman,10/10/08

S&C's Mitchell Eitel,10/3/08

Munger Tolles's Robert Denham,9/26/08

S&C's H. Rodgin Cohen, 9/19/08

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