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NEW YORK — Dec. 16, 2004 – The international law firm of Chadbourne …

NEW YORK — Dec. 16, 2004 – The international law firm of Chadbourne & Parke LLP represented the lenders’ committee of Transportation de Gas del Sur S.A. (TGS) in a US$1.02 billion debt restructuring that closed on Dec.15.

TGS, Argentina’s largest transporter of natural gas and the operator of the southern Argentina natural gas pipeline system, completed its $1.02 billion restructuring of bank and capital markets debt through an out-of-court restructuring which comprised an exchange of TGS’ existing notes and bilateral loans for new notes and the amendment and restatement of two loan agreements with Inter-American Development Bank. TGS’ restructuring offer was consented to by approximately 99.76% of TGS’ unsecured creditors included in the restructuring.

Chadbourne attorneys working on the deal include partner Rohit Chaudhry of the Washington, D.C. office, Latin America Counsel Carlos Albarracin of the New York office and Washington, D.C. office associate James Scarrow. In addition, support on securities law issues was provided by partners Claude Serfilippi of the London office and Alejandro R. San Miguel of the New York office.

“It is truly impressive that a restructuring of this size, with a large number of noteholders and bank debt providers, achieved a nearly 100% level of consent from the creditors,” said Chaudhry.

Similar to many Argentine restructurings, TGS’ restructuring offer also contemplated an Acuerdo Preventivo Extrajudicial or “APE”. Under an APE, a company is able to restructure its unsecured debt with the consent of more than 50 percent of all unsecured creditors determined on a head count basis and at least 2/3 of the aggregate amount of unsecured debt. If the APE is approved by court, then it binds all unsecured creditors, regardless of whether or not they granted their consent or participated in the process.

In addition to the APE option, the TGS restructuring was innovative in that it included different parallel restructuring options depending on the level of creditor support. Under TGS’ offer, if the creditor consent level exceeded 96%, instead of an APE, the restructuring was to be consummated by means of a voluntary exchange offer.

If the creditor consent level was less than 96% by equal to or higher than 85%, then TGS’ restructuring was to be implemented by means of both an APE and a voluntary exchange. Under this option, TGS would file an APE but instead of waiting for the APE to be endorsed, it would consummate the restructuring with its consenting creditors through an exchange offer while the APE was pending. TGS’ holdout and non-participating creditors would receive their new notes upon a “cramdown” when the APE was endorsed by the Argentine court.

However, since TGS received consents in excess of the 96% threshold required for an exchange offer, the restructuring was implemented by means of an exchange offer without the filing of an APE.

Chadbourne, which has a strong Latin American practice, is currently advising on a number of Argentine and Latin American debt restructurings.

About Chadbourne & Parke LLP

Chadbourne & Parke LLP, an international law firm headquartered in New York City, provides a full range of legal services, including mergers and acquisitions, securities, project finance, corporate finance, energy, telecommunications, commercial and products liability litigation, securities litigation and regulatory enforcement, white collar defense, intellectual property, antitrust, domestic and international tax, reinsurance and insurance, environmental, real estate, bankruptcy and financial restructuring, employment law and ERISA, trusts and estates and government contract matters. The Firm has offices in New York, Washington, D.C., Los Angeles, Houston, Moscow, Kyiv, Warsaw (through a Polish partnership), Beijing and a multinational partnership, Chadbourne & Parke, in London. For additional information, visit www.chadbourne.com.

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