Legal Business

News in brief – February 2015

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Strategic recruitment DLA PiperKennedysKirkland & EllisLatham & WatkinsOsborne ClarkeShakespeare Martineau
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KENNEDYS OPENS IN SCOTLAND

Last month, Kennedys finally entered the Scottish market with the opening of offices in Glasgow and Edinburgh after talks with Simpson & Marwick fell through at the end of 2013. The firm hired Francis Gill & Co’s founder and director Frank Gill, and Rory Jackson, insurance liability and regulatory partner at McClure Naismith, to co-lead the practice.


LATHAM OPENS NEARSHORING OFFICE IN MANCHESTER

Latham & Watkins announced it is set to open a business services office in Manchester during 2015. In the firm’s second centre (after its first in LA), 25 staff will focus on IT and technology support in Europe and there will also be a financial analysis team to provide practice and regional heads with greater budgetary insight.

Legal Business

Significant departures: Latham & Watkins hires CC’s private equity co-head Oliver Felsenstein

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Strategic recruitment Clifford ChanceLatham & Watkins
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Latham & Watkins has strengthened its corporate bench in Germany with the hire of Clifford Chance’s (CC) co-head of private equity Oliver Felsenstein and partner Burc Hesse.

Heavyweight Felsenstein was only a few months into a four-year term as head of CC’s Germany corporate practice having succeeded partner Peter Dieners, who became managing partner for Germany, in August 2014

He was also co-head of the private equity group alongside London-based partner Jonny Myers. The firm has confirmed there are no plans to appoint a successor with Myers now solely leading the global group.

Both Felsenstein and Hesse advise on domestic and cross-border mergers and acquisitions, with a particular focus on complex private equity transactions. They have experience in a number of very active industries, including the automotive, real estate, retail and technology sectors.

With its 30C high flying days firmly in the past, the Canary Wharf-headquartered CC has been the subject of considerable scrutiny. Widely reported partner exits from its corporate piece have brought into question its position as housing a preeminent buyout team and in recent months, it’s understood that Jonny Myers was himself approached by the rapidly growing Gibson, Dunn & Crutcher.

Other departures of late include one of its biggest billers, David Walker, also to Latham & Watkins in 2013. Walker was followed by Tom Evans and Kem Ihenacho only months later, constituting another blow as both were touted as rising stars to watch in the private equity space.

The news also follows CC’s downsizing of its German presence after carrying out an internal review before Christmas, a move which expects to see around nine partners exit.

On the arrival of Felsenstein and Hesse, Latham & Watkins Frankfurt office managing partner Dirk Oberbracht said: ‘They are among the hardest working, hands-on and skillful M&A lawyers in the market and they have an impressive track record advising on a number of high profile deals. Their expertise and deep market knowledge complements our practice and they will add vast experience to our already strong German and European team.’

The firm’s global chair of corporate, Daniel Lennon, added: ‘We are committed to building the undisputed market leading practice in private equity in Europe and globally.’

sarah.downey@legalease.co.uk

Legal Business

Cross-border ties: Ropes & Gray and Weil Gotshal act on Bain Capital’s $2.1bn TI Automotive deal

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Corporate Latham & WatkinsRopes & GrayWeil, Gotshal & Manges
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US firms Ropes & Gray and Weil Gotshal & Manges have won roles advising buyout group Bain Capital on its $2.1bn acquisition of leading fuel systems supplier TI Automotive.

Ropes & Gray advised Bain Capital in all aspects of the acquisition as the firm looks to deepen its relationship on this side of the Atlantic with the private equity company. Its team included London-based private equity partner Will Rosen alongside Boston-based private equity partners Alison Bomberg and Newcomb Stillwell, and finance partner Byung Choi. Goldman Sachs and UBS Securities served as financial advisors to Bain, while PwC is serving as accounting advisor to Bain.

Weil Gotshal represented TI Automotive, which was founded in Birmingham as Tube Investments, led by Michael Aiello out of New York alongside Peter King and Marco Compagnoni in London. Blackstone Advisory Partners served as financial advisor.

An ad hoc group of TI Automotive shareholders instructed Latham & Watkins as legal counsel, while Lazard is advising the non-executive directors of TI Automotive’s board of directors.

TI Automotive’s existing management team will continue to lead the company which produces components for the car manufacturing industry with a focus on vehicle fluid management. The signing of a definitive agreement was announced yesterday [27 January] although the financial terms were not disclosed.

The acquisition is expected to close by the middle of this year.

jaishree.kalia@legalease.co.uk

Legal Business

A €7.4bn enterprise value: Ropes & Gray and Lathams advise on Altice purchase

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Corporate Latham & WatkinsRopes & Gray
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US firms Ropes & Gray and Latham & Watkins won roles advising on telecommunications group Altice’s purchase of Portuguese telecoms rival Oi’s assets worth €7.4bn on a cash and debt-free free basis.

Ropes & Gray are acting for Altice with a transatlantic team led by City finance partner Michael Kazakevich and New York-based partner Alex Zeltser advising on financial aspects including loan structures, revolving credit facilities and bonds.

Latham & Watkins’s team are representing the underwriters which comprise a group of 14 banks including JP Morgan Chase, Goldman Sachs, Deutsche Bank, Morgan Stanley, Credit Suisse, BNP Paribas, HSBC and Nomura. London based capital markets partner Scott Colwell advised on high yield bonds, finance partner Dan Maze advised on English law and New York finance partner Melissa Alwang on US term loans.

Altice has agreed to issue €4.6bn in high yield bonds and has arranged a €825m seven year term loan. The acquisition was approved last week by shareholders of Oi subsidiary Portugal Telecom and on Monday bondholders of the company agreed as long as the proceeds were used to help consolidate the Brazilian telecoms market or to pay down debt. The financing is expected to close early next week.

Altice announced in November last year that it entered into exclusive negotiations with Oi to agree the purchase of its Portuguese assets Portugal Telecom. A month later, it had signed a definitive agreement with Oi to purchase Portugal Telecom at an enterprise value of €7.4bn on a cash and debt-free free basis which included a €500m consideration related to the future revenue generation of Portugal Telecom.

jaishree.kalia@legalease.co.uk

Legal Business

Asia-Pacific: Cadwalader raids Latham’s Hong Kong office for seven lawyer team

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Strategic recruitment Cadwalader, Wickersham & TaftLatham & Watkins
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Michael Liu, who was co-head of Latham & Watkins‘ Greater China practice and was formerly managing partner of its Hong Kong office, has led a seven lawyer move over to US rival Cadwalader, Wickersham & Taft.

Liu is joined by partner corporate partner Jane Ng and the switch sees senior associate Stephen Chan made up to partner. The team originally joined Latham from Magic Circle firm Allen & Overy in 2008, where Liu was head of Asia, and the exits leave Latham with just 14 partners in Hong Kong.

Counsel Simon Berry, Olivia Wong, Terris Tang and Eva Tam also make the switch, with the hires expanding Cadwalader’s Hong Kong office from 14 to 20 lawyers.

The team’s experience over the past three decades in Hong Kong and China spans public takeovers, private M&A, joint ventures, IPOs, regulatory and compliance matters under the Hong Kong Listing Rules and securities legislation.

‘Drawing on more than 200 years of history, Cadwalader’s position as one of the most pre-eminent Wall Street firms is what attracted us in the first place,’ explained Liu. ‘Our team has been together for over twenty years and we share the firm’s commitment to building its Greater China practice on the important foundations of quality clients and quality lawyers.’

Greg Petrick, co-chair of Cadwalader’s financial restructuring group and head of international practice development, said: ‘We are fully committed to enhancing our capabilities for clients from our Hong Kong and China offices.’

tom.moore@legalease.co.uk

Legal Business

‘An investment in Europe’: Latham & Watkins to open nearshoring office in Manchester

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Innovation Latham & Watkins
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US firm Latham & Watkins has announced internally that it will open a business services office in Manchester during the first half of 2015.

The office will service the firm’s European network with Latham & Watkins planning to have around 25 staff in place by the end of the year. The move will be spearheaded by Rod Harrington, the firm’s chief administrative officer, Europe.

The firm says that growing demand in London, where the firm has expanded from 184 lawyers in 2010 to 258 in 2014, is behind the decision. A spokesperson for the firm told Legal Business: ‘It’s an investment in Europe.’

Following an 18-month consultation, the Manchester office will initially focus on IT and technology support, with a financial analysis team to provide practice and regional heads with greater budgetary insight. ‘Our initial focus is on those two areas but that could grow over time,’ says Harrington.

He told Legal Business: ‘We landed on Manchester for a number of reasons. Firstly, there’s a good talent pool, and secondly, we’re very much a one-firm global operating model so travel to our other offices is vital and Manchester is the second most connected city in the UK after London.’

He added: ‘It’s a long-term play, we’ve not been forced to do this for short-term cost cutting reasons, it’s about dealing with the significant growth at the firm which we expect to continue. As we’ve grown outside the US, that poses challenges as the LA business services office has had to provide service to Europe in the middle of the night. By establishing a business services unit in the European timezone we can pretty much cover 24-7 support.’

The firm opened its first global services office in Los Angeles over a decade ago and now has over 300 staff in its business services team, covering IT, accounting, business development and human resources. 

London-headquartered Berwin Leighton Paisner opened a business services office in Manchester last year and mid-tier firm Nabarro opened a partner-led office to handle real estate work in May.

Baker & McKenzie opened its first business services outpost in Europe with a Belfast office late last year. Allen & Overy and Herbert Smith Freehills have also nearshored low-cost legal services to Belfast as firms restructure their operations to become more cost-effective.

tom.moore@legalease.co.uk

Legal Business

Deal watch: Corporate activity in November 2014

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Corporate Latham & WatkinsLinklaters
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BATTERSEA POWER STATION SEES BAKER & MCKENZIE AND NRF TAKE THE LEAD

In one of the largest real estate financings in recent years, Bakers advised a syndicate of Asian and Middle Eastern banks on debt facilities worth £1.35bn. Norton Rose Fulbright (NRF) acted for the borrowers.

 

Legal Business

Media attention: Latham & Watkins hires six-partner team from O’Melveny & Myers

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Strategic recruitment Latham & WatkinsO'Melveny & Myers
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US firm Latham & Watkins continues its aggressive hiring strategy with the recruitment of a six-partner team from O’Melveny & Myers, including the firm’s entertainment, sports and media group head Joseph Calabrese and high profile London-based partner Libby Savill.

On the US side, Calabrese and partners Christopher Brearton, Robert Haymer, Nancy Bruington and Kenneth Deutsch are set to join the firm.

Savill had joined O’Melveny from Olswang two years ago and was tasked with launching the firm’s UK media practice. She specialises in commercial work for major studios, independent producers, independent distributors and television content providers, and is also deputy chair of the British Film Institute.

She is the latest heavyweight to join the London office in a series of hires since 2013. Others include Macfarlanes environmental specialist Paul Davies, Nick Benson from Weil Gotshal & Manges; David Walker and Kem Ihenacho from Clifford Chance; Lucy Oddy from Berwin Leighton Paisner; and Tom Alabaster from The Carlyle Group. The office now has over 250 fee-earners including 65 partners.

O’Melveny & Myers, meanwhile, yesterday (11 November) named partners Stephen Scharf, Matthew Erramouspe, and Bruce Tobey as the new transactional co-heads of its entertainment, sports and media practice.

In a statement, the firm said: ‘Stephen, Matthew, and Bruce, together with our leading entertainment litigators, are furthering a legacy laid down by John O’Melveny, Deane Johnson, Donald Petroni, and others. Today, entertainment companies are facing an expanding global market and a changing digital media landscape, and O’Melveny’s award-winning entertainment lawyers are poised to help them achieve their goals.’

Latham & Watkins declined to comment. 

sarah.downey@legalease.co.uk

Legal Business

Dealwatch: Lathams, Linklaters and HSF lead on $700m Dealogic sale

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Corporate Herbert Smith FreehillsLatham & WatkinsLinklaters
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Lathams & Watkins, Linklaters and Herbert Smith Freehills have all won roles advising on The Carlyle Group and Euromoney Institutional Investor’s acquisition of Dealogic.

The Washington DC based private equity giant agreed to acquire the software and data company Dealogic for $700m, alongside two other co-investors – online information and events group Euromoney, and, co-founder and former CEO of Capital IQ, Randall Winn.

Latham & Watkins’ cross-border team advised Carlyle, led by London corporate partners Mike Bond and Richard Butterwick, and Washington DC corporate partner David Brown, with advice on financing matters by fellow Washington-based partners Jeffrey Chenard and Scott Forchheimer, and London partner Dominic Newcomb. Herbert Smith Freehills advised Euromoney with partners Mark Bardell and Howard Murray.

Linklaters advised Dealogic with London senior corporate partner Charlie Jacobs leading the team alongside corporate partner Nick Rumsby, and Scott Sonnenblick out of New York.

Barclays Capital and JP Morgan provided financial advice to Carlyle, while Investec acted as financial advisor to Dealogic, and Gleacher Shacklock acted for Euromoney.

Carlyle will be the controlling shareholder in Dealogic with its equity for the transaction coming from its $13bn US buyout fund Carlyle Partners VI. Dealogic’s long-serving chief executive Tom Fleming will continue in his leadership role.

Euromoney will acquire 15.5% of the equity of Dealogic for $59.2m, funding the investment through the sale Capital DATA and Capital NET, valued at $85m, and which Dealogic and Euromoney have jointly operated since the 1980s. In addition to its $59.2m share, Euromoney will also receive $4.6m in cash on completion and a further $21.2m of zero-coupon preference shares issued by Dealogic.

The transaction, which is expected to close by the end of 2014, is structured as a leveraged buyout by Dealogic and is subject to customary regulatory approvals.

jaishree.kalia@legalease.co.uk

Legal Business

Dealwatch: Latham & Watkins, Macfarlanes and Travers Smith lead on £200m Gorkana sale

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Corporate Latham & WatkinsMacfarlanesTravers Smith
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Latham & Watkins, Macfarlanes and Travers Smith have all landed key roles on the £200m sale of media database Gorkana to US rival Cision.

The deal marks one of the first heavyweight mandates undertaken by Latham & Watkins partner Tom Evans, who joined the US firm in April from Magic Circle firm Clifford Chance (CC). The firm’s corporate team, led by London partners David Walker alongside Evans and Chicago-based partner Bradley Faris, advised the buyer public relations software provider Cision.

Evans has previously been tipped as a rising star in the private equity field, and followed Walker, formerly CC’s global head of private equity, who left to join Latham in May 2013.

Sold by private equity house Exponent, the Gorkana Group was established when Exponent acquired cuttings business Durrants in 2006.

Macfarlanes also scored a leading role on the deal, advising its longstanding client Exponent and other selling shareholders, with corporate head Charles Meek leading a team including corporate partners Alex Edmondson and Emmie Jones, as well as tax group head Ashley Greenbank.

Travers Smith’s private equity head Paul Dolman, meanwhile, advised management alongside Kathleen Russ, head of the tax group, and senior associate Adam Orr.

sarah.downey@legalease.co.uk