New Year surge in high-value deals after subdued year
While deal activity was down again in 2013, last year’s growth in confidence in the corporate sector, together with fundraising activity among a number of large private equity houses, has seen some of the UK’s elite firms advise on high-value deals announced in January, including Amec’s $3.2bn acquisition of Swiss rival Foster Wheeler.
The Linklaters team advising Amec was led by corporate finance partner Shane Griffin, alongside fellow corporate partner Aedamar Comiskey. Scott Sonnenblick and Tom Shropshire are advising on US law aspects of the deal from New York and London respectively, while John Tucker and Simon Pritchard are leading on finance and antitrust issues.
A Freshfields Bruckhaus Deringer team led by London co-head of M&A Simon Marchant, alongside US corporate practice head Matthew Herman, is advising Foster Wheeler. The engineering sector has been consolidating recently with the takeover last year of UK firm Edwards Group by Sweden’s Atlas Copco. However, for this deal both companies turned to US firms – Weil, Gotshal & Manges and Pillsbury Winthrop Shaw Pittman respectively.
Nonetheless UK law firms, with some help from local European firms, are also involved in Cineworld’s £503m acquisition of Warsaw-listed Cinema City, announced in January. This deal would create a cinema chain with almost 2,000 screens across 201 sites in Europe and Israel.
Slaughter and May is advising Cineworld, with corporate partners Mark Zerdin and David Johnson taking the lead. The team also includes finance partner Guy O’Keefe who told Legal Business: ‘In terms of the financing it was a really good collaborative process with a supportive banking group.’
Slaughters is working alongside Paul, Weiss, Rifkind, Wharton & Garrison (US law), Sołtysiński Kawecki & Szlęzak (Polish law), Djingov, Gouginski, Kyutchukov & Velichkov (Bulgarian law), Nagy és Trócsányi (Hungarian law), Havel, Holásek & Partners (Czech and Slovakian law), Nestor Nestor Diculescu Kingston Petersen (Romanian law) and Herzog Fox & Neeman (Israeli law).
Herbert Smith Freehills, meanwhile, landed the mandate to represent Barclays, J.P. Morgan Cazenove and Investec on Cineworld’s £107m rights issue and on the acquisition itself, led
by corporate partners Mike Flockhart and Chris Haynes.
Clifford Chance is acting for Cinema City, with a team led by corporate partners Jonny Myers and Spencer Baylin. Linklaters also has a role on the deal advising other financial advisers.
News of these deals comes despite reports that M&A transactions were down overall globally in 2013. Mergermarket recently released its league tables of legal advisers on global M&A for 2013, showing total global M&A value was down 3.2% on 2012 at $2,215.1bn, the third successive year of falling M&A activity.
Total value figures for M&A in 2013 were further distorted by Verizon’s $124.1bn acquisition of a 45% stake in Verizon Wireless from Vodafone in September, a deal that accounts for more than 5% of the total deal value for the year.
However, Weil, Gotshal & Manges ECM and M&A partner Peter King said: ‘The market has been building up since the second half of last year and is starting to produce more deals. There’s more confidence at boardroom level
and private equity has been active throughout. But there is always an element of fragility in these things.’
Laurence Levy, head of Shearman & Sterling’s European M&A group, is also optimistic. He told Legal Business: ‘There’s definitely a more positive outlook among lawyers, bankers and the wider M&A community. You could see that at the end of last year quite a lot of deals would be announced in the first quarter due to an uptick in deals being worked on towards the end of the year.’
DealWatch: Corporate activity in January
Cleary and Sidley Austin drink to Suntory deal
Japan’s Suntory continues on the acquisition trail with its takeover of US whiskey distiller Beam in a deal worth $16bn. Cleary Gottlieb Steen & Hamilton is advising Suntory, with a team led by corporate partners Paul Shim and Benet O’Reilly. Beam has turned to Sidley Austin’s Chicago-based corporate partners Tom Cole and Beth Flaming in a deal that will see Suntory become the third-largest maker of distilled drinks in the world.
Debevoise and Mayer Brown advise on Petroleum Equity acquisition
Debevoise & Plimpton advised private group Petroleum Equity on its $133m acquisition of ATP Oil and Gas UK. ATP UK’s parent company ATP Oil & Gas Corporation is currently undergoing Chapter 11 insolvency proceedings in the US. Debevoise’s team in London is being led by partner Geoffrey Kittredge, and includes tax partners Matthew Saronson and Richard Ward. Mayer Brown is advising ATP Oil and Gas UK with a team led by Rob Hamill, co-head of the global energy group, and Devi Shah, co-head of the restructuring, bankruptcy and insolvency group in London.
US firms star in blockbuster deal
Paul Hastings has represented China Media Capital (CMC) in its acquisition of a $150m, 47% stake in Star China TV from 21st Century Fox, the joint venture partner of CMC. CMC, the Chinese media and entertainment fund, has invested alongside the broadcaster’s management team. The Paul Hastings team was led by partners Jia Yan and David Wang, while Kirkland & Ellis Hong Kong partners Nicholas Norris, Steven Tran and Ashley Young acted for Fox.
Dentons acts on first major foray into UK shale
Dentons is advising Total as the first major oil company to invest in UK shale. In a deal worth $48.1m and led by energy partner Danielle Beggs and environment partner Sam Boileau, the energy giant confirmed it would invest in the search for shale gas in the Gainsborough Trough area in the East Midlands region covering an area of 240 sq km.