Legal Business

Deal watch: Slaughters and Kirkland drill into giant $12bn offshore plc merger as Travers and Eversheds maximise L&G’s pensions buy-out

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Corporate Eversheds SutherlandKirkland & EllisSlaughter and MayTravers Smith

Slaughter and May and Kirkland & Ellis have led on the $12bn combination of UK Plc offshore drilling companies Ensco and Rowan Companies as Travers Smith and Eversheds Sutherland wrap up Legal & General’s £2.4bn buyout of Nortel Networks UK Pension Plan.

The drilling merger – an all-stock deal and a court-sanctioned scheme of arrangements – will see the shareholders of Ensco and Rowan own 60.5% and 39.5% respectively of the combined business.

Kirkland & Ellis clinched a significant win in UK plc land in advising Rowan with a team including City partners David Higgins, David Holdsworth and Dipak Bhundia. The deal was led out of Houston by corporate partners Sean Wheeler and Doug Bacon and included Dallas partner Ryan Gorsche and New York-based executive compensation partner Scott Price and tax partners David Wheat, Lane Morgan and Mike Carew.

Latham & Watkins is advising Rowan on antitrust aspects, with a team including corporate partner Michael Egge in Washington, Brussels managing partner Lars Kjolbye, and London partner Jonathan Parker.

Meanwhile, Slaughters is acting for Ensco with a team led by corporate partners Hywel Davies and Christian Boney and including partners William Turtle (competition), Jonathan Fenn (pensions) and Mike Lane (tax).

Elsewhere, a Legal & General deal on Monday (8 October) saw the UK insurer complete a £2.4bn buyout of pensions relating to the now-defunct telecoms equipment provider Nortel.

The buy-out relates to around 15,500 pensioner members and around 7,200 deferred members of the pension scheme, which entered a Pension Protection Fund (PPF) assessment after Nortel went into administration in 2009, pending litigation and insolvency proceedings.

The Travers team advising the trustees was led by Dan Naylor and Susie Daykin and also included partner Peter Hughes. Advising Legal & General was an Eversheds team led by Hugo Laing.

Naylor told Legal Business that the deal represented the biggest ever PPF plus arrangement, in which the pension scheme members receive more options, via a member option exercise, and better benefits than the PPF compensation would have offered. A further transaction is likely to follow as more recoveries are made.

The deal is also the second biggest pension buyout ever, after the £2.5bn transaction with Legal & General relating to pensions of US-headquartered automotive supplier TRW in 2014.

Hughes and Naylor, the latter then an associate, were also part of the team advising the trustees of the TRW Pension Scheme, while Laing, then an associate at Clifford Chance, was part of the team advising Legal & General on that deal.

Another major deal this week saw Kirkland, Latham and Allen & Overy score key roles on the sale of shareholdings in fin-tech company FNZ to Canadian pension fund La Caisse de dépôt et placement du Québec (CDPQ) and private equity investor Generation Investment Management.

The deal sees Kirkland advise the sellers, FNZ and funds advised by HIG Capital and General Atlantic, led by London corporate partners Gavin Gordon, Carl Bradshaw and Tom McCarthy. A Latham team led by Michael Bond advised CDPQ and Jonathan Wood at Weil Gotschal & Manges advised Generation. Karan Dinamani at Allen & Overy advised the CEO of FNZ.

The acquisition is the first investment by CDPQ-Generation, the sustainable equity joint venture launched by CDPQ and Generation.  Kirkland has a nine-year relationship with FNZ, having advised on HIG Capital’s initial investment in 2009, General Atlantic’s investment in 2012 and FNZ’s recently announced deal to acquire European Bank for Financial Services (ebase) from comdirect bank.

nathalie.tidman@legalease.co.uk

Legal Business

Deal round-up: Travers advises Shazam on Apple buyout as Freshfields and Norton Rose strike gold on $18bn mining merger

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Corporate Freshfields Bruckhaus DeringerNorton Rose FulbrightTravers Smith

In the latest flurry of deals, Travers Smith has represented popular mobile app Shazam on its buyout by tech giant Apple, while a raft of international firms have benefitted from recent transactional activity.

Shazam, which was founded in 2002, is a song recognition app which can identify what music is playing via a phone’s inbuilt microphone. The deal for Shazam, reportedly worth $400m, will see Apple offer the app on an ad-free basis for all users.

The buyout was initially delayed by a European Commission (EC) probe, amid fears it could give Apple Music a competitive advantage over rival streaming apps such as Spotify and Deezer, but the EC gave the takeover the green light earlier this month.

Shazam was advised by Travers Smith, with a team spearheaded by corporate finance partner Andrew Gillen. Gillen was supported by partners Jessica Kemp and Madeleine Gowlett, who offered specialist tax advice, while commercial advice was given by partner Louisa Chambers.

Apple was represented by Cooley, while Hogan Lovells also featured on the deal, advising Shazam on US aspects of the transaction.

Elsewhere, Freshfields Bruckhaus Deringer and Norton Rose Fulbright landed key roles as goldmining giants Randgold and Barrick of Canada announced an $18bn combination.

The merger is expected to create the largest gold company in the world in terms of tier one gold assets, and is predicted to have a market capitalisation of $18.3bn.

Freshfields is one of the firms advising Barrick on the merger. Leading for the Magic Circle firm are corporate partners Piers Prichard Jones and Stephen Hewes. US outfits Davies Ward Phillips & Vineberg and Cravath, Swaine & Moore also advised Barrick, alongside offshore firm Carey Olsen.

Norton Rose was on hand to support the US-based Randgold with a transatlantic team. Corporate partners Jon Perry and Nick Adams led for the firm out of London, while New York-based securities partner Steven Suzzan provided advice on the US side. Canadian firm Stikeman Elliot and offshore outfit Ogier also represented Randgold.

Finally, White & Case has advised the creditors of pharmaceuticals company Concordia on its $3.7bn recapitalisation.

The restructuring came after Concordia faced a number of issues, including regulatory scrutiny of its past business practices and a large amount of debt accrued from its previous acquisitions. As a result of the restructuring, Concordia’s debt has reduced from around $3.7bn to $1.4bn. A Carey Olsen team, led by partner Kate Andrews, advised the ad-hoc group of secured creditors on Jersey law aspects of the deal.

Christian Pilkington, one of White & Case’s lead restructuring partners on the mandate, commented: ‘This deal illustrates our ability to combine our global restructuring, finance and regulatory capabilities with our deep knowledge of the pharmaceutical industry.’

tom.baker@legalease.co.uk

Legal Business

Travers makes pension play with Sackers hire as KFC GC Nelson-Smith decamps to WeWork

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Strategic recruitment Travers Smith

Travers Smith has made a rare lateral play with the hire of Sebastian Reger to its pensions sector group as KFC loses highly-regarded general counsel (GC) Sarah Nelson-Smith to WeWork.

Travers announced today (20 September) that Reger will be joining the firm from pensions boutique Sackers & Partners, where he had been a partner since 2015 in the finance and investment team. Reger started his career at Magic Circle firm Freshfields Bruckhaus Deringer.

Travers intends to add Reger’s pensions experience into the firm’s structured finance practice, with Reger having acted for a number of trustees, custodians and collateral managers. Reger will now work alongside the firm’s dedicated pensions partners while practicing in Travers’ derivatives and structured products group.

Daniel Gerring, head of the pensions sector group at Travers, told Legal Business: ‘We have been wanting to expand this practice at the partner level for a while, and there is a natural synergy between the structured finance practice and pensions. Sebastian has excellent experience spending the majority of his career at Freshfields before honing his pensions practice at Sackers.’

Meanwhile in the in-house community, Nelson-Smith is moving to collaborative workspace company WeWork from fast-food chain KFC, where she had been European chief legal officer. The move adds a string to the bow for WeWork in its European offering, with Nelson-Smith having a private practice background with Freshfields and US law firm Baker Botts, as well as holding in-house roles at Taco Bell and Pizza Hut owner Yum! Brands.

It was during Nelson-Smith’s tenure at KFC that the fast food company was put under the spotlight in the BBC One documentary The Billion Dollar Chicken Shop, while at the beginning of the year she oversaw KFC’s first European panel review.

thomas.alan@legalbusiness.co.uk

Legal Business

LB100 case study: Travers Smith

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Financial results 2017/18 Travers Smith

You can always rely on Travers Smith for revenue growth; the City independent has posted its ninth consecutive year of financial expansion. Although, in many ways, the 18% uptick in turnover to £146.9m was a triumphant bounce back from 2016/17’s results, when revenue inched up just 4% against a backdrop of Brexit uncertainty.

The revenue increase is more impressive when considering that only £900,000 of the £146.9m figure was generated overseas – in Travers’ small Paris branch – emphasising the firm’s strength in its domestic market.

Legal Business

City’s mid-weight elite set blistering pace as Travers and Macfarlanes surge in 2017/18

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Financial results 2017/18 MacfarlanesTravers Smith

Marco Cillario assesses the results amid another strong year for the City’s mid-tier

The latest financial results by UK law firms show leading mid-market players once again harnessing robust commercial activity to post a series of startling results well ahead of larger rivals.

Legal Business

Another big-dollar mandate for Travers as Micro Focus sells software business to EQT

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Dealwatch Travers Smith

Extending beyond its reputation for outstanding mid-market deal work, Travers Smith has once again put its name to a multibillion-dollar deal as IT company Micro Focus sells its open-source software business SUSE for $2.5bn.

Swedish private equity group EQT Partners is on the other side of the table and turned to US giants Latham & Watkins and Milbank, Tweed, Hadley & McCloy to advise on the acquisition.

Legal Business

Travers Smith unveils double-digit revenue growth as profitability soars 24%

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Financial results 2017/18 Travers Smith

In its ninth consecutive year of revenue growth, Travers Smith has recorded an 18% uptick in turnover to £146.9m, while profit per equity partner (PEP) also saw a dramatic increase.

The private equity leader’s 2017/18 performance eclipsed last year’s result when revenue inched up 4% against a backdrop of Brexit uncertainty.

Travers’ robust performance was also reflected in a 24% hike in PEP, jumping from £970,000 in 2016/17 to £1.2m this year.

Travers managing partner David Patient (pictured) said: ‘A lot of hard work, from every team across the firm, has gone into producing these excellent results.

‘The strategic investments in our people and business over the last few years are paying dividends, and the confidence we, and our clients, have in our model is reflected in some fantastic work this year,’ added Patient.

Undoubtedly a major factor in the positive results is the firm’s ability to punch above its weight, particularly in big-ticket private equity deals.

Long-standing client Bridgepoint proved a fruitful source of work for Travers over the last year, with the firm advising the private equity shop on its £1.5bn sale of food chain Pret A Manger in June. In another gastronomical deal, Travers was again on hand to advise Bridgepoint as it acquired a raft of UK Burger King franchises.

Other standout mandates included the firm’s representation of PureGym’s management team as its business was acquired by US private equity house Leonard Green & Partners for £600m.

Travers is currently led by Patient and senior partner Chris Hale, with Patient being re-elected as managing partner at the beginning of this year and starting his second three-year term on 1 July.

tom.baker@legalease.co.uk

Legal Business

Deal Watch: Rich pickings for Travers and Ashurst as US giants get busy on the continent

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Corporate AshurstTravers Smith

It was a busy week for UK and US deal counsel as Travers Smith and Ashurst acted on multibillion-pound deals north of the channel and White & Case and Ropes & Gray landed key mandates in continental Europe.

Again acting well above its traditional mid-market territory, Travers advised IT company Micro Focus on the $2.5bn sale of open source software business SUSE to EQT Partners.

Head of corporate Spencer Summerfield led the Travers team, which also included corporate partners Jon Reddington and Mohammed Senouci.

Summerfield pointed to his firm’s history with the software business, having advised UK company Micro Focus when it initially bought SUSE in 2014 as part of the $2.3bn acquisition of The Attachmate Group. He commented: ‘This investment has generated substantial shareholder value and provided the SUSE business with a strong, long term investor to support its next phase of growth.’

Travers also fielded a team of specialists on the deal, including IP and tech partners Dan Reavill and James Longster, competition partner Stephen Whitfield, tax partners Simon Skinner and Madeline Gowlett, head of incentives and remuneration Mahesh Varia and real estate partner Paul Kenny.

The deal was another big mandate for Travers after longstanding client Bridgepoint recently instructed the UK firm on its £1.5bn sale of Pret A Manger.

A Latham & Watkins team led by finance partner Dominic Newcomb advised EQT alongside Milbank, Tweed, Hadley & McCloy. Completion of the deal is expected in the first quarter of next year.

Meanwhile, White & Case advised CVC Capital Partners in one of Italy’s largest ever private equity transactions: the €3bn acquisition of Italian drugmaker Recordati from the family of the company’s founders.

White & Case’s Milan office founder Michael Immordino acted for the private equity house on the M&A and financing aspects of the transaction. CVC will buy 51.8% of Recordati in a transaction valuing the company at almost €6bn.

London partners Mike Weir and Steve Worthington were also part of the team, alongside Milan-based Ferigo Foscari and Leonardo Graffi. Martin Forbes, James Greene, Iacopo Canino and Alessandro Nolet advised on the financing of the deal.

Italy private equity firm Gattai Minoli Agostinelli & Partners also acted for CVC with founder Bruno Gattai and partners Gerardo Gabrielli, Nicola Brunetti and Lorenzo Cairo. Independent firm Studio Tributario Associato Facchini Rossi & Soci advised on tax and due diligence with partners Luca Rossi, Giancarlo Lapecorella and Marina Ampolilla.

Also on the continent, Ropes & Gray advised Netherlands telecoms company Altice Europe on the sale of stakes in its tower businesses in France and Portugal to KKR, Morgan Stanley and Horizon Equity Partners in a deal worth €2.5bn.

London finance partner Michael Kazakevich led the US firm’s team acting on the financing side, while French firm Franklin advised Altice on the M&A aspects with partners Christian Sauer, Julie Catala Marty and Magali Masson.

French firm Darrois Villey Maillot Brochier and US giant Simpson Thacher advised KKR, which will buy 49.99% of Altice’s French tower company, including 1,200 sites in the country valued at €3.6bn.

Partners Alain Maillot and Jean-Baptiste de Martigny led Darrois’s team. Morgan Stanley infrastructure and horizon equity partners will acquire 75% of Altice’s Portuguese tower company, with a portfolio of 2,961 tower sites worth €660m.

Back in the UK, Ashurst advised Volcan Investments on the acquisition of Vedanta Resources in a deal valuing the UK mining company at £2.3bn and bringing an end to its UK listing.

Corporate partner Tom Mercer led the team acting for Volcan, which already owns 66.5% of Vedanta and is seeking to acquire the rest for £778m. Corporate partner Robert Ogilvy Watson and finance partner Tim Rennie were also part of the Ashurst team.

Ashurst had acted for Vedanta on the $812.6m acquisition of Electrosteel Steels and the $2.3bn merger with Cairn India. But this time the firm acted for Volcan, which had previously turned to Allen & Overy as it invested £3.5bn in Anglo American.

Latham advised the independent committee of the board of Vedanta with a London-based team led by corporate partners Richard Butterwick and Nick Cline.

marco.cillario@legalease.co.uk

Legal Business

Rich pickings for Travers Smith and Freshfields as Bridgepoint cashes in on Pret

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Dealwatch Freshfields Bruckhaus DeringerTravers Smith

Ten years after acquiring Pret A Manger in a deal worth £350m, private equity house Bridgepoint is selling it for more than four times its original investment and providing City firms with big mandates.

Luxembourg-headquartered JAB Holding Company, an investment firm owned by Germany’s Reimann family, is to buy the food chain for £1.5bn.

Legal Business

More reshuffling as Hogan Lovells appoints new chair while Travers Smith confirms Patient managing partner

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Leadership Hogan LovellsTravers Smith

As the January senior appointments merry-go-round at City and global law firms continues, Hogan Lovells has announced a new chair while Travers Smith has re-elected David Patient as managing partner.

In a move that brings its German practice in the spotlight, Hogan Lovells has announced that Hamburg-based Leopold von Gerlach will replace Nicholas Cheffings as chair of the board on 1 May for a three-year term.

A member of the board representing continental Europe since 2014, IP, media and technology partner von Gerlach was voted into the new role by the partnership after the board put forward his name following a firm-wide consultation process. He joined the firm in 1995.

Members of Hogan Lovells’s board make up the compensation committee, which looks after the firm’s annual bonus scheme and reviews equity partners’ remuneration every second year. They are also part of the equity elevation and partner advancement committees, working with the firm’s management on the promotion of associates and counsel to the partnership.

The board provides input to the international management committee and oversees the affairs of the firm, but has no executive responsibility for strategy.

Speaking to Legal Business, Cheffings said von Gerlach had a ‘broad combination of attributes’ that made him the right choice for the role: ‘He has been with the firm for a long time, he understands the culture, he is very focused upon collaboration and people being at the heart of our business – very good with clients.’

Real estate disputes co-head Cheffings was Hogan Lovells’ first post-merger sole global chair, taking over from co-chairs Claudette Christian and John Young in 2012, two years after the merger between Lovells and Hogan & Hartson. He was re-appointed in the role in 2015  and is now stepping down after reaching the maximum two terms set by the firm.

He said his main achievement in his six years as chair was ‘overseeing the transition from a firm which was seen as a new kid on the global block – with a lot of energy and excitement but clearly challenges in terms of delivering on its plans – to what’s now a very mature player and one of the most highly respected global law firms with a very distinct place in the legal market.’

Cheffings will continue to lead Hogan Lovells’ real estate disputes group along with Mathew Ditchburn.

Meanwhile, Travers Smith re-elected David Patient as managing partner after he stood unopposed.

Patient, who will manage the firm for a second three-year term starting on 1 July, told Legal Business: ‘Last year went by in a flash, and politically we seemed to be lurching from one crisis to another but we sailed through it all. Clients were very busy in lots of areas, regulatory has been very busy and disputes has been firing on all cylinders. Private equity and M&A have also been strong.’

He added he was ‘pretty positive’ for the year ahead. ‘There will be some bumps in the road ahead but I’m confident that this year is going to be good in lots of areas.’

Travers-bred corporate lawyer Patient became a partner in 1999, when he established its Paris office, and replaced Andrew Lilley at the helm of the firm in January 2015 . He had previously run for the managing partner role in 2009 losing out to Lilley, who went on to serve a second term in 2012.

The firm’s most recent financial performance showed a 4% rise in revenue to £125m in 2016/17, marking eight consecutive years of growth. But profit per equity partner dropped 4% to £970,000, with Patient saying at the time the firm was ‘right in the middle’ of a period of significant investment .

marco.cillario@legalbusiness.co.uk