August has proved to be active with big-ticket deals prompting inbound investment to the UK with the disposal of John Wood Group’s nuclear business to US-based Jacobs Engineering Group, as well as the sale of Greene King to Hong Kong’s CKA Group.
Paul Hastings advised Jacobs Engineering Group on its acquisition of John Wood Group’s nuclear business in the UK, Europe and the Far East for a cash consideration of roughly £250m.
The deal is part of Wood’s strategy to offload its non-core areas and to lower its debt levels following its acquisition of Amec Foster Wheeler in 2017. The deal is subject to conditions including competition clearance and is expected to close in the first quarter of 2020.
Jacobs, a New York Stock Exchange listed company, is a provider of technical services and has an expansion strategy for its complementary areas of aerospace, technology and nuclear.
The Paul Hastings team, led by London-based M&A partner Roger Barron, included managing partner Ronan O’Sullivan and M&A partner Matthew Poxon, both in London.
John Wood Group was advised on the transaction by a Slaughter and May team led by corporate partners Simon Nicholls and Filippo de Falco and included competition partners Lisa Wright and Bertrand Louveaux, pension and employment partners Padraig Cronin and Daniel Schaffer as well as data protection partner Rebecca Cousin.
Barron told Legal Business: ‘This is just the sort of deal that I joined Paul Hastings to do – transatlantic M&A for a major US company, where we can provide the sector expertise as well as deal execution capability on both sides of the pond.
‘Jacobs has a very clear strategy for using M&A to expand into profitable and complementary areas. This is seen as a good business and works well with their existing strategy. For this deal about 90% of the business is UK. You could see this as a US company being confident in the prospects of a UK business,’ added Barron.
Meanwhile, Linklaters won a lead mandate advising pub giant Greene King on its proposed £2.7bn sale to Hong Kong real estate group CKA, with Clifford Chance (CC) advising the buyer.
The 220 year old Suffolk-based brewery has around 2,700 pubs, restaurants and hotels nationally. Its acquisition follows the takeover of Ei Group by Stonegate Pub for £1.3m last month.
The Linklaters team was led by corporate partners Dan Schuster-Woldan and Nick Rumsby while Lee Coney and Nick Rees led the CC team which also included Alex Nourry (antitrust), Sonia Gilbert (employment) and Matt Taylor (real estate).
Norton Rose Fulbright advised HSBC, the financial adviser to CK Asset Holdings. CKA has agreed to the terms of the acquisition which include a 51% premium on the value of Greene King through its recently formed Cayman Islands based subsidiary CK Bidco.
The Norton Rose team was led by corporate partner Paul Whitelock.
Elsewhere a Ropes & Gray London team, led by private equity partner Philip Sanderson and finance partner Malcolm Hitching, advised private equity firm Duke Street on the acquisition of railway holiday provider, Vacation by Rail.
The US acquisition, funded partially by English law governed facilities, brought together the firm’s English and US law expertise. The deal follows the acquisition of Great Rail Journeys, escorted rail holiday provider, by Duke Street Capital from ECI a year ago.
Andrew Arons at Williams, Bax and Saltzman in Chicago acted for the sellers.
Sanderson told Legal Business: ‘The deal reflects an important trend of PE backed businesses like GRJ seeking growth in the US. This has become increasingly important for ambitious mid-market businesses where a strong European platform is proven and allows PE to support the next step into the US. We are regularly helping businesses in this way.
“The European summer deal market has been favourable for few in PE. The paucity of deals has naturally combined with high price for the deals that do come to market. The B word has left the market as uncertain as it has been for many years and so bolt ons for PE have become a popular means to generate activity from within the portfolio. Better what you know, is a factor in that, as well as the potential for economies and bargains from smaller strategically important deals.’
