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Dealwatch: Latham and Linklaters bet on £2.2bn William Hill disposal as £1.2bn easyJet rights issue flies

While it could hardly be said to have slowed down over summer, the deal market has nevertheless ramped up since the beginning of September with easyJet’s £1.2bn rights issue and Caesars’ £2.2bn disposal of William Hill’s international business among the more high-profile recent transactions.

Latham & Watkins and Linklaters won lead roles as 888 Holdings agreed to acquire the international business – the non-US assets – of William Hill at an enterprise value of £2.2bn.

The deal was the result of a hotly-contested auction process run by Deutsche Bank and followed on from the closing in April this year of Caesars Entertainment’s £2.9bn takeover of William Hill with a view to building out its US business, a buyout originally announced in October 2020.

Ed Barnett, the Latham relationship partner for 888 who led on the deal, told Legal Business: ‘This was a very competitive process. Caesars had make it clear to the market that it was going to sell the non-US assets of William Hill, so it was expected to be competitive. Deutsche Bank ran a very successful auction. We understand bidders were mostly comprised of private equity houses but also some private equity and strategic combinations. It’s obviously a very well-known, longstanding brand and so it is a real asset in the space and once the deal closes it’s expected to put 888 in a strong position as a significantly bulked-up business.’

Barnett was also bullish on the wider market outlook: ‘There’s certainly been a lot of activity in the gaming sector in the UK and US and you’re going to continue to see transactional activity, SPAC-related deals and tie-ups between US and European/UK businesses in the gaming space. As individual states in the US relax gaming-related regulations we anticipate more activity. It’s a very hot sector in which Latham has been, and will continue to be, very active.’

Latham corporate partner Sam Newhouse also advised on the deal, while Anna Ngo dealt with capital markets matters, Jay Sadanandan and James Burnett provided finance advice and Jonathan Parker gave antitrust advice. Employment and benefits matters were handled by partner Sarah Gadd, IP by Deborah Kirk, tax by Helen Lethaby and real estate matters by Quentin Gwyer.

The Latham team advised in conjunction with 888’s long-term counsel, Israeli firm Herzog Fox & Neeman, whose team was led by managing partner Gil White. The Linklaters team advising Caesars was led by London corporate partner Iain Fenn.

Meanwhile, the £1.2bn rights issue of easyJet also piqued market interest and provided instructions for teams from Herbert Smith Freehills, Allen & Overy and Clifford Chance.

The rights issue, the largest such transaction in the UK this year, will see funds raised to increase the resilience of easyJet’s balance sheet and to fund strategic investments as air travel recovers from the Covid-19 pandemic.

The Herbert Smith team advising easyJet was led by head of UK equity capital markets Mike Flockhart and global co-head of corporate Stephen Wilkinson. Head of US securities Tom O’Neill and counsel Dennis Hermreck provided US securities advice. The easyJet legal team was led by GC Maaike de Bie.

HSF’s Mike Flockhart noted of the transaction: ‘easyJet’s rights issue demonstrates that the markets will continue to endorse companies with solid fundamentals, effective leadership and strong brands, notwithstanding the impact of Covid.’

A&O is advising Greenhill and BNP Paribas as joint sponsors; BNP Paribas, Credit Suisse and Goldman Sachs as joint global co-ordinators; and Santander and Société Générale as joint bookrunners on the rights issue, with James Roe and Jeff Hendrickson leading the team.

The firm is also advising BNP Paribas, Credit Suisse, Goldman Sachs, Santander and Société Générale as lenders under easyJet’s new revolving credit facility, announced simultaneously with the rights issue, led by A&O’s head of aviation finance, Paul Nelson.

A&O has advised easyJet’s financiers on a number of matters since the start of the pandemic, including acting for the underwriters on the company’s £400m equity cashbox placing in June 2020, advising UK Export Finance (UKEF) and the lenders on $1.87bn combined UKEF and EDG commercial facility in January – the first-ever secured transaction under the UKEF Export Development Guarantee scheme, and advising the dealers and trustee on easyJet’s £1.2bn bond issue in February 2021.

CC acted for easyJet on matters relating to shareholder enfranchisement with a team led by partners Daud Kahn and Melissa Fogarty.

Elsewhere and continuing the transport theme, RAC and its shareholders – including funds managed or advised by CVC Capital Partners and GIC – sold a stake in the UK breakdown assistance provider to Silver Lake.

Together with GIC and CVC, Silver Lake will support RAC in its goal of further improving its digital capabilities and leveraging its data to provide more innovative products and services for RAC members and partners to accelerate growth.

Freshfields Bruckhaus Deringer advised longstanding clients RAC and the selling shareholders with a team led by partners Alastair Brown and Charles Hayes.

Travers Smith acted for the management team of RAC with private equity and financial sponsors Partner Adam Orr leading and tax advice provided by partners Hannah Manning and Russell Warren.

Meanwhile Baker McKenzie advised Silver Lake on the acquisition of its stake, led by partner David Allen, with the team also including finance partner Matt Cox and antitrust partners Luis Gomez and Sam Mobley.

Finally, funds advised by Apax Partners and Warburg Pincus acquired T-Mobile Netherlands Holding from Deutsche Telekom and Tele2, giving  the company an enterprise value of €5.1bn.

Freshfields and Simpson Thacher advised WP/AP Telecom Holdings IV, an entity jointly controlled by funds advised by Apax Partners and Warburg Pincus, on the acquisition. The Freshfields team was led by partners Markus Paul and Shawn der Kinderen, and James Howe led the London Simpson Thacher team, with Ian Barratt acting on the debt aspects of the acquisition.