Legal Business

Hogan Lovells joins top firms in £3.6bn Royal Mail takeover as UK govt approves bid

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Dealwatch Hogan LovellsKirkland & EllisPaul, Weiss, Rifkind, Wharton & GarrisonSlaughter and May

Hogan Lovells has secured a new role as adviser to the UK government on the £3.6bn acquisition of International Distribution Services (IDS), the parent company of Royal Mail, by Czech billionaire Daniel Křetínský’s EP Group, alongside Kirkland, Paul Weiss, and Slaughter and May.

On 16 December, the UK government announced that it had approved the bid after reaching an agreement with Křetínský’ to protect Royal Mail’s workers and key services while ensuring the company remains headquartered in the UK.  

EP Group has committed to preserving the universal service obligation – which includes maintaining the ‘one-price-goes-anywhere’ service with six-day-a-week delivery for first-class letters.  Control of Royal Mail must also remain unchanged for at least three years after the acquisition.  

The acquisition values IDS’ entire share capital at £3.6bn, implying an enterprise value £5.3bn. The proposal was announced in May, however, the change in government meant that Westminster approval didn’t come through until this month.  

Hogan Lovells corporate partner Tom Brassington advised the UK government on the takeover.  

A Kirkland team, led by Legal 500 Hall of Famer for high-value PE deals David Higgins, alongside corporate partners Dipak Bhundia, Jiri Peterka, and Fiona Coffee, is advising EP Group on the transaction.  

Meanwhile, a Paul Weiss team, led by Legal 500 acquisition finance Hall of Famer Neel Sachdev, corporate partner Stefan Arnold-Soulby, and Legal 500 Hall of Famer for EU and competition law Nicole Kar, is advising EP Group on the acquisition’s financing and structuring.  

At Slaughters, Legal 500 leading partner for M&A premium deals Richard Smith is advising the IDS board, alongside corporate partner Claire Jackson.  

The deal, which still needs to be approved by IDS shareholders, is expected to complete in the first quarter of 2025.  

An offer document released in June estimated that legal fees for EP Group would total £12.3m while legal fees for IDS would also total £12.3m.  

In an announcement published on the government’s website, Křetínský said: ‘EP Group is very pleased to have reached this historic agreement with the Business Secretary to safeguard the future of Royal Mail, under EP Group ownership.’  

Postal services minister Justin Madders said: ‘A sustainable Royal Mail is a successful Royal Mail, and through this agreement we’re paving the way towards a brighter future where it can be a source of national pride once again.’  

tom.cox@legalease.co.uk

Legal Business

Slaughter and May matches magic circle peers with NQ pay hike to £150k

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Salaries Slaughter and May

Slaughter and May has raised pay for newly-qualified (NQ) lawyers to £150,000, bringing the firm to parity with its Magic Circle peers.

The firm was slated to review its pay rates in November, but has brought the review forward, with the new rate effective from 1 September.

The increase means that Slaughters no longer trails Herbert Smith Freehills and Hogan Lovells, which both announced raises to £135,000 for their NQs in June.

The latest salary arms race kicked off at the beginning of May, when Freshfields Bruckhaus Deringer announced that it had hiked NQ salaries by 20% from £125,000 to £150,000. The other Magic Circle firms soon responded, with Clifford Chance, Linklaters and A&O announcing that they would matching £150,000 by the end of that month, leaving Slaughters as the only holdout.

Freshfields was also the first mover in April 2022, when the firm raised salaries from £100,000 to £125,000, setting a new Magic Circle benchmark.

The £150,000 salary still leaves the Magic Circle behind their free-spending US counterparts. Gibson Dunn and Quinn Emanuel Urquhart & Sullivan currently offer starting salaries of £180,000, and Paul Weiss announced last month that new trainees would earn £180,000 upon qualification.

The hikes have raised eyebrows in some quarters, with market-watchers describing the trend as ‘slightly alarming’, noting that clients ‘must question getting advice from junior lawyers who are paid so highly.’

For more, see The new £150k benchmark for Magic Circle associates – ‘rewarding the best’, or ‘slightly alarming’?

tom.cox@legalease.co.uk

 

 

 

 

 

 

 

Legal Business

Dealwatch: Slaughters, Latham lead as Hammerson sells £1.5bn stake in Bicester Village owner

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Dealwatch Herbert Smith FreehillsLatham & WatkinsSlaughter and May

Shopping centre owners have weathered a difficult few years, with the rise of e-commerce, Covid and the cost of living crisis causing much grief for those with stakes in bricks and mortar retail.

There is cause for optimism, however, with private equity firm L Catterton’s acquisition of Hammerson’s £1.5bn stake in Value Retail – owner of the Bicester Collection – emblematic of increasing confidence in the sector, and raising hopes of a continued recovery in deal activity.

Slaughter and May advised Hammerson on the transaction, which generated approximately £600m in cash proceeds for the property firm, fielding a team led by corporate duo Simon Tysoe and Richard Smith.

Meanwhile, Latham & Watkins advised the buyers, with the sale handled through Silver Bidco Limited, a newly formed company incorporated in Jersey established by affiliates of L Catterton, which is part owned by luxury goods giant LVMH. The firm’s London team was led by corporate partners Tom Evans and Linzi Thomas.

The Bicester Collection comprises nine luxury designer outlet shopping centres located outside of major European cities including Barcelona, Paris and Milan. It includes the Bicester Village shopping centre which is located on the outskirts of the Oxfordshire town Bicester.

Rita-Rose Gagné, CEO of Hammerson, said in a statement that the disposal was a ‘transformational deal’ that removed an ‘overweight, low yielding and minority stake’ and ‘focuses our portfolio on prime urban real estate’.

Hammerson has in the past turned to Herbert Smith Freehills for many of its major corporate and real estate mandates, including the £277m disposal of its stake in premium outlet operator Via Outlets in Q4 of 2020, led by corporate duo Alex Kay and Mike Flockhart. Kay also led on Hammerson’s attempted £3.2bn buyout of Intu in 2018, a transaction that was ultimately abandoned.

Another sign of increasing bullishness in the retail space was seen last month with TDR Capital’s acquisition of Zuber Issa’s shares in Asda, a deal that took the private equity firm’s share in Asda to 67.5%. Kirkland & Ellis advised TDR, led by corporate partners Stuart Boyd and Jessica Corr alongside competition partners Alasdair Balfour and Joel Gory, while Cleary Gottlieb Steen & Hamilton acted for Issa.

tom.cox@legalease.co.uk

Legal Business

Kirkland, Paul Weiss and Slaughters lead on £3.5bn Royal Mail takeover bid

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Deals Kirkland & EllisPaul, Weiss, Rifkind, Wharton & GarrisonSlaughter and May

Kirkland & Ellis, Paul Weiss and Slaughter and May are advising on the proposed takeover of the Royal Mail’s parent company, International Distributions Service (IDS), by Czech billionaire Daniel Kretinsky. 

The deal is a revised non-binding proposal from EP Corporate Group for the remaining share capital of IDS which is not already owned by EP, which at present, holds 27.6% of IDS’s issued share capital.  

The proposal values the entire issued share capital of IDS at approximately £3.5bn.  

EP is being advised by Kirkland, with a team led by corporate partners David Higgins, Dipak Bhundia and Jiri Peterka, alongside antitrust & competition partner Matthew Sinclair-Thomson. 

Paul Weiss is also advising EP, handling financing and structuring aspects of the bid, with finance duo Neel Sachdev and Stefan Arnold-Soulby, leading the firm’s team.

Slaughters corporate duo Richard Smith and Claire Jackson are advising IDS’s management.  

In an announcement to the London Stock Exchange, IDS chair Keith Williams said: ‘The Board is minded to recommend this offer price, which it considers to be fair and reflects the value of GLS’ current growth plans and the progress being made on change at Royal Mail to adapt the business to a significant fall in the demand for letters and growth in parcels.  

‘It is however regrettable that despite four years of asking, the Government has not seen fit to engage in reform of the Universal Service and thus improve our financial position and ensure that Royal Mail could provide an economically sustainable service to the British public.’

holly.mckechnie@legalease.co.uk

Legal Business

Promotions dip at Slaughters as firm makes up five new partners

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Partnership promotions Slaughter and May

Slaughter and May has made up five new partners in its latest round of promotions, a 50% drop from last year’s round of ten.

Four of the new partners are based in London, with the final addition in Brussels.

In London, disputes and investigations associate Ross Francis-Pike, private equity associate Aleezeh Liaqat (pictured, left), financial institutions senior counsel Tom Peacock and competition senior counsel Tina Zhuo (pictured, right) will all join the partnership on 1 May.

Meanwhile, in Brussels, competition lawyer Alexander Chadd has been promoted to partner from senior counsel.

Standout mandates for Chadd include advising Elanco on its acquisition of Bayer’s Animal Health business, and advising Ball Corporation, on its acquisition of Rexam. Liaqat’s recent work includes advising Corsair Capital on the acquisition of a majority stake in MJM Holdings. Peacock previously advised Tata Steel on £7.5bn worth of derisking, as well as advising RSA Group on a £6.5bn derisking of two of RSA’s main defined pension schemes with PIC. Meanwhile, Zhuo has advised Google on several investigations and market studies and advised John Wood Group on its acquisition of Amec Foster Wheeler.

The promotions are in line with diversity and inclusion targets set out by Slaughters in 2021, in which the firm committed to its global equity partner promotions being 40% female by 2027, with at least 15% of London and Brussels promotions between 2020 and 2025 to come from ethnic minority backgrounds.

This year’s cohort is 40% female, with the same percentage coming from an ethnic minority background.

Steve Cooke, Slaughter and May senior partner said: ‘I am very pleased to announce the election of five new partners. Each will make a valued contribution to their respective practice area and to the continued success of the firm.’

The promotions take Slaughters to 106 partners worldwide.

holly.mckechnie@legalease.co.uk

Legal Business

Slaughters’ outgoing senior partner Cooke to follow fellow grandees in post-retirement pivot

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Leadership Slaughter and May

Slaughter and May’s eminent senior partner Steve Cooke has become the latest law firm leader to embrace a change of direction post-retirement with the news that he is to join PR agency Brunswick Group.

Cooke (pictured) will finish his term as Slaughters’ senior partner on 30 April 2024 after which he will join Brunswick as a partner, tasked with advising clients on matters including M&A, crisis, disputes and litigation.

Cooke will join John Davies, previously a partner in Freshfields’ antitrust, competition and trade group, who moved to Brunswick in 2019 as a senior adviser. Senior lawyers pivoting their careers has become something of a trend in recent years, accelerated by the pandemic. In 2021, Charlie Jacobs, Linklaters’ former senior partner moved to JP Morgan as its co-head of investment banking in 2021. His colleague Sarah Wiggins, formerly Linklaters’ London corporate head, also made the move to banking, joining HSBC as vice chair for global banking in 2022.

Also in 2022, Gideon Moore, Linklaters’ erstwhile global managing partner, became chief legal officer and general counsel of NatWest, as well as taking on a non-executive director role at new law scale-up, nexa.

For its part, M&G plc in February 2022 announced that Edward Braham, Freshfields’ former senior partner, was to join the listed UK investment manager as its chair on 14 March 2022.

Elsewhere, former executive chairman of Freshfields William Lawes, joined financial advisory and asset management firm Lazard as a managing director in 2017, while former Clifford Chance managing partner Matthew Layton joined FTI Consulting in January 2023 as a senior adviser.

The succession of Cooke on 1 May 2024 by Roland Turnill, head of the firm’s M&A practice and co-head of the financial institutions group, was announced in September 2021, an unusually long lead-in time for a City stalwart.

Cooke said in a statement: ‘I have worked closely with Brunswick since its inception on a range of matters and have always been impressed by the breadth and depth of the firm’s expertise on issues that really matter to clients.

‘I am excited to join at a time when the firm is growing strongly and enhancing its capabilities – and the value it delivers to clients – all the time. I look forward to working with Brunswick colleagues and clients in the UK and globally,’ he added.

Cooke joined Slaughter and May as a trainee in 1982, becoming a partner in 1991. He was appointed as senior partner in 2016, having headed the firm’s M&A practice from 2001 to 2016.

His client book includes FTSE 100 clients such as Aviva, Barratt Developments, BAT, Centrica, Diageo, Hikma Pharmaceuticals, International Airlines Group, Reckitt Benckiser, Rolls-Royce and WPP. He is also a non-executive director of Young & Co’s Brewery and will become its chair in July 2024.

Slaughter and May managing partner Deborah Finkler said: ‘We have worked successfully alongside Brunswick for many years, and this is a great opportunity for Steve. We look forward to continuing to work with Brunswick and with Steve when he takes up his new role next year.’

Neal Wolin, chief executive officer at Brunswick said: ‘Steve is a truly world-class adviser and an outstanding addition to our firm. His clients have turned to him for many years for deep expertise and trusted counsel. He brings to Brunswick unrivalled experience in M&A and a broader set of critical issues facing companies globally. I am delighted he is joining the firm, where he will add meaningful value to the leaders of our clients around the world.’

holly.mckechnie@legalease.co.uk 

Legal Business

‘Holding ourselves accountable’: Slaughter and May tackles social mobility challenge with 2033 targets

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Social diversity Slaughter and May

Slaughter and May has stuck its head above the parapet on the thorny issue of social mobility, outlining ambitious targets for 2033, in what will be seen as a bold move at the elite end of the profession.

Over the next decade the firm aims to increase its representation of individuals from a lower socio-economic background (LSEB) by 25% across its total workforce population from a baseline of 18.8%. Broken down across fee earners and business services professionals, Slaughters intends to increase its lawyer population from such backgrounds to 15% from a baseline of 10% and its business services population to 40% from a baseline of 34.7%. These targets measure a person’s socio-economic background by using parental occupation at the age of 14 as a metric.

Slaughters partnered with the not-for-profit, social equality consultancy the Bridge Group to carry out a workforce analysis on setting its targets. The Bridge Group found that progression, retention and performance of lawyers from a lower social background at the firm was the same as lawyers from other socio-economic backgrounds. It also found that in the firm’s business services roles the LSEB population stood at 34.7%. The national census figure for LSEB individuals is 39%. These findings were used to inform the firm’s action plan, which places a particular emphasis on widening access throughout its early stage recruitment processes.

The action plan has three strands. Firstly, Slaughters aims to increase the number of LSEB individuals it hires through graduate and business services recruitment. Steps will include targeted recruitment activity aimed at engaging students who might not participate in its traditional recruitment processes, as well as providing apprenticeships as an alternative route into the firm.

Secondly, the firm plans to increase its work on widening access to the profession. Over the next five years, Slaughters will extend its scholarship scheme and introduce a new financial bursary scheme for 17–18-year-olds.

Thirdly, the firm will double down on its workforce data relating to social mobility. It will encourage employees to disclose diversity data, with a target of 90% disclosure. The firm will also voluntarily publish social mobility related pay gaps through its annual pay gap reporting.

Commenting on the targets, Andrew Jolly, corporate partner and chair of Slaughters’ social mobility working group, said: ‘Our detailed work with the Bridge Group shows that when LSEB lawyers come to Slaughter and May their progression is strong and they are just as likely as their peers from other socio-economic backgrounds to succeed in the firm. The targets and actions we have announced focus on ensuring this continues to be the case as well as making the firm an attractive place to work for people from a wide range of backgrounds.’

Deborah Finkler (pictured), managing partner at Slaughters, added: ‘Tracking the socio-economic make up of our workforce over a long period of time means that we have confidence in the data we are using to set these public targets and measure our progress. This focus and transparency means we can hold ourselves accountable and sends a clear message about our intentions to enhance and maintain a diverse workforce.’

holly.mckechnie@legalease.co.uk

Legal Business

Global 100: Slaughter and May – Keeping the magic alive

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Financial Results 2021/22 Slaughter and May

‘It’s a remarkable firm with a tremendous reputation, but it has to take note of the fact that the market is changing.’ So says one transatlantic law firm leader, summarising a view that has chimed throughout Legal Business’ numerous Global 100 interviews.

Arguably the most conservative of the City elite, Slaughter and May has long won plaudits for steadfastness, staying true to its London heartland of advising FTSE 100 and 350 clients, even as peers struck out to follow transatlantic ambitions. As the pace of change in the market amid globalisation and intense competition reaches giddying speeds, many commentators question whether the stalwart’s approach is underpinned by justified confidence or hubris.

Legal Business

Life During Law: Jeff Twentyman

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Profile Slaughter and May

I acquired through reading an interest in justice and the role law could play. One book I read in my late teens was influential. In the Spirit of Crazy Horse by American journalist and author Peter Matthiessen. Written in 1983 about an individual who was part of the American Indian Movement called Leonard Peltier. He happens to still be in jail 45 years later, in what this book would tell you was a major miscarriage of justice. It profoundly affected me. The idea that law could be a force for good attracted me to the legal system.

I was predisposed to arguing. I found it interesting to pursue the right answer through discussing it with people. Constructive arguing rather than arguing in a teenager-y sort of way. I made the connection that actually the two things played into each other. I was possibly a little bit idealistic.

Legal Business

Deals Yearbook 2022: Sally Wokes, Slaughter and May – partner since 2015

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M&A Slaughter and May

Why did you decide to become an M&A lawyer? Was there anyone in particular who inspired you early on in your career?
I unexpectedly fell in love with it in my first seat at the firm. It was the boom before the bust of 2005, and I found the pace and energy of what was happening in the group a huge draw. Ancillary to that, I have to say Melissa Fogarty, who was my first supervisor, and who has now gone on to be the co-head of London corporate at Clifford Chance.