Legal Business

Deal Watch: Slaughters advises on £3.6bn ICI pension annuity buy-in and £390m Ignis buyout; Travers leads on $3.1bn Nets sale

Posted on |
Corporate Kirkland & EllisSlaughter and MayTravers Smith
legal-business-default

Standout corporate mandates over the past few days have included a high profile run by Slaughter and May on deals including a £3.6bn bulk annuity buy-in over the ICI Pension Fund and Standard Life’s £390m acquisition of Ignis Asset Management, as Travers Smith and Kirkland & Ellis led on the $3.1bn acquisition of Nordic card-payment business Nets Holding.

Slaughters pensions and employment partner Charles Cameron led a multi-disciplinary team for Imperial Chemical Industries and Akzo Nobel on the de-risking of the ICI Pension Fund, under which the trustees of the fund entered into bulk annuity buy-in policies with Legal & General Assurance Society and Prudential Retirement Income, representing the largest bulk annuity policy arranged by a pension scheme in the UK.

Also on the team were corporate and commercial partner Jonathan Marks, financing partner Philip Snell and associates Victoria MacDuff, Eleanor Hart and Victoria Judd.

Allen & Overy led by insurance partner Philip Jarvis and pensions partner Neil Bowden advised the trustee of the ICI Pension Fund.

The deal came as Marks led for Slaughters on investment group Standard Life’s acquisition of Ignis Asset Management for £390m in cash. Freshfields Bruckhaus Deringer led by Robert Stirling advised Ignis.

Last week the Magic Circle firm announced its role alongside Paul, Weiss, Rifkind, Wharton & Garrison advising RSA Insurance Group on a fully underwritten rights issue to raise approximately £773m, led by corporate partner Andy Ryde, and separately for Dong Energy on its disposal of a 50% interest in offshore windfarm Westermost Rough to Marubeni Corporation and UK Green Investment. Linklaters led by John Pickett advised the buyers.

Meanwhile, at Travers Smith a team led by senior partner Chris Hale, along with senior corporate associate Adam Orr, worked alongside Danish law firm Bruun & Hjejle, to advise management on the acquisition of Nets Holding by a group of private equity firms including Advent International, Bain Capital and Danish pension fund ATP for $3.1bn.

A Kirkland & Ellis team advised the buyers, with a team that included London-based corporate partners Sam Pakbaz and Justin Hutchinson along with debt finance partners Neel Sachdev and Christopher Shield, tax partner Ian Taplin and competition partner Sarah Jordan.

Announced on Monday, the deal requires that the buyers pay Nets shareholders roughly $17 in cash for each of the Copenhagen-based target’s shares. Nets shareholders will also receive a dividend worth about 50 cents per share. The deal is expected to close in the second quarter, pending regulatory approval.

Nets provides payment solutions, card and information services and digital security solutions in the Nordic region and has 2,600 employees. Last year the payment processor handled more than six billion card transactions supporting more than 33 million payment cards and over 500,000 merchants in the Nordics.

Travers Smith on the same day announced its role advising Cyprus-based online broker IronFX Global on its sponsorship agreement with FC Barcelona.

The arrangement will see IronFX, which has 15 platforms trading over 200 instruments in forex, spot metals and CFDs on US and UK stocks and commodities, become an ‘official partner’ of the renowned football club throughout the world, giving it extensive marketing and promotional rights over FC Barcelona’s brand and player images.

Francesca.fanshawe@legalease.co.uk

Legal Business

Kirkland opens up in Beijing to expand 65-lawyer Chinese operation

Posted on |
Asia Kirkland & Ellis
legal-business-default

Kirkland & Ellis has expanded its sizeable Chinese footprint by opening an office in Beijing, the top 10 global firm announced today.

With 55 lawyers in Hong Kong and 10 in Shanghai, the new Beijing presence will focus on M&A and private equity transactions, international capital markets transactions, fund formation and government enforcement and investigations.

Corporate partners David Zhang, who joined from Latham & Watkins two years ago, and Chuan Li, who is the founding partner of the firm’s Hong Kong and Shanghai offices, will spearhead the Beijing launch.The firm is not expected to hire new lawyers in Beijing for the time being. 

‘Cross-border transactional activity between Greater China and the rest of the world continues to grow, and our strong platform in Asia, the U.S. and Europe positions us to provide the best advice and service to our clients across the globe. Our presence in Beijing expands our reach throughout the region and ensures our ability to serve our clients better,’ said Jeffrey Hammes, chairman of the firm’s global management executive committee.

‘Kirkland has advised on some of the most sophisticated and significant transactions in Greater China in recent years, including the largest leveraged buyout in China to date, the largest Hong Kong IPO this year and the only U.S. IPO from China this year,’ Zhang added.

‘Having a strong on-the-ground presence in Beijing will better position us to access and efficiently serve our target client base and underscores our ongoing strategy in Asia of focusing on diversified high-end, high-value transactional practices that enable us to provide the best advice and representation through diverse market conditions.’

Kirkland has been involved in a number of standout deals in China, including representing Focus Media’s independent committee in connection with its $3.7bn going-private transaction; representing Tudou Holdings Limited in its merger with Youku and representing Koor Industries in its $2.4bn going-private sale of Makhteshim Agan Group to China National Chemical Corporation.

China is a target for many US and UK law firms with both Eversheds and Clyde & Co launched in Beijing this year, although partners regularly report fee pressures in the region and Asia as a whole is still regarded by many as a long term game.

david.stevenson@legalease.co.uk

Legal Business

Kirkland’s trophy hire – Robert Khuzami to join the firm in Washington

Posted on |
Strategic recruitment Kirkland & Ellis
legal-business-default

If securing senior US regulatory agency lawyers can be compared to a highly competitive game of cards, then Kirkland & Ellis has just called poker with the hire of Wall Street’s top federal enforcer Robert Khuzami.

Khuzami (pictured, who, incidentally, has a Wikipedia listing running into several pages) joins as a partner in the top 10 Global 100 firm’s global government, regulatory and internal investigations practice group after leading the Securities and Exchange Commission’s (SEC’s) enforcement division for four years.

Reported today by the New York Times to be joining on a package of over $5m a year (also said to be guaranteed for two years), he will be based in both the firm’s Washington and New York offices.

Senior SEC official Kenneth Lench is also set to join Khuzami within the same practice group in Washington at the end of July. Lench has headed the structured and new products unit within the SEC enforcement division since January 2010.

The recent additions will strengthen the firms white collar and securities defence practice in line with the growing client demand of regulatory and enforcement issues.

Kirkland’s global management executive committee chairman Jeffrey Hammes said: ‘Rob is one of the most respected and experienced attorneys within global enforcement and brings invaluable public and private sector experience to our growing government, regulatory and investigations practice.

‘Rob and Ken joining our existing team of talented lawyers furthers our ability to provide our clients with the highest level of resources, advice and counsel globally.’

As a prosecutor, Khuzami tried 12 federal criminal trials to verdict, including the successful prosecution of Omar Ahmed Ali Abdel Rahman and nine co-defendants in connection with the 1993 bombing of the World Trade Center. Before the SEC, he worked at Deutsche Bank in New York as global head of litigation and regulatory investigations in 2002, before becoming general counsel for the Americas from 2004 until 2009. He has also served as a federal prosecutor within the US Attorney’s Office for the Southern District of New York, including three years as chief of its Securities and Commodities Fraud Task Force (between 1991 and 2002.)

The hire is a coup for Kirkland, which is understood to have had stiff competition to hire Khuzami since his departure from the SEC in January.

Lench, meanwhile, joins Kirkland after 23 years at the SEC. His role as structured and new products chief was created by Khuzami in 2010 to focus on abuses in markets for complex securities, including asset-backed securities and derivatives.

Kirkland litigation partner Gene Assaf added: ‘Washington, D.C. regulatory and enforcement issues have become critical to global clients, and the addition of this senior team continues the expansion of our enforcement and regulatory capabilities and presence here.’

 

jaishree.kalia@legalease.co.uk

Legal Business

Comment: A star signing is one thing but who needs a lateral?

Posted on |
Strategic recruitment DLA PiperKirkland & EllisLatham & Watkins
legal-business-default

The worlds of business, politics and sport have since the 1970s fallen increasingly under the spell of the star individual and law has been anything but an exception. As partnership mitigates the heaviest excesses of the winner-takes-all compensation cultures seen in banking, sports and plc management, in law the star culture has manifested to a considerable extent via the partner recruitment market.

The emergence and massive expansion of this international bazaar for senior legal talent over the last 25 years has had a profound impact on the profession – often unhappily so.

This has happened despite widespread acknowledgement that the returns on partner recruitment are patchy – a finding backed by a significant and growing body of research. Compared to internal candidates, external recruits are more expensive even without counting direct recruitment costs, prone to fail in the first two years and more likely to leave. Added to which is the fundamental difficulty of accurately identifying and then persuading key business influencers to move.

Sound familiar?

Yet if such problems are rife in the legal profession, the impact of the sustained downturn in Western economies has done little to deflate the partner bubble. If anything, the upwardly mobile US law firms that have increasingly defined the partner recruitment market at home and abroad have pushed this merry-go-round towards even more aggressive levels.

And this has happened during a period in which the record of partner recruitment has arguably become worse not better. When partners first began moving in the late 1980s, a path was provided for ambitious and driven individuals to find better platforms or just check out of firms going nowhere. Those hires generally did well because there was a clear economic rationale for the move on both sides. The last decade has seen the emergence of a genuinely sideways market for partners who are just moving, well, laterally.

That’s not to suggest that all of this recruitment is irrational. Some firms have used partner recruitment to effectively super-charge their growth, with Latham & Watkins, Kirkland & Ellis and DLA Piper being among the most striking examples in recent years. The poor overall performance of lateral recruitment has always masked the vast discrepancies in individual performance.

Here is our assessment of the track record of partner recruitment: a small group of firms use it very effectively to deliver great results. A much larger group gets returns barely worth the effort once you account for the time and costs of recruitment. What’s left is another minority that performs so badly that firms in the club actually damage their business. But law – like many fields – remains poor at identifying the formula for success.

We consider the experience of a handful of the transferring partners that have excelled in this month’s edition and there are common factors in what makes a star signing an actual success, but it’s never easy. In essence, firms should be strongly biased towards organic progression unless there is a compelling, clear strategic reason to go to market. Then you must have a senior candidate that actually fits the bill and is energised about the opportunity of your team. The best lawyers don’t do it for the money or a home. They do it for the game. They play to win.

alex.novarese@legalease.co.uk

Legal Business

A star signing is one thing but who needs a lateral?

Posted on |
Strategic recruitment DLA PiperKirkland & EllisLatham & Watkins
legal-business-default

The worlds of business, politics and sport have since the 1970s fallen increasingly under the spell of the star individual and law has been anything but an exception. As partnership mitigates the heaviest excesses of the winner-takes-all compensation cultures seen in banking, sports and plc management, in law the star culture has manifested to a considerable extent via the partner recruitment market.