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Reassuringly expensive: Freshfields and Linklaters take biggest gulp from $260m legal fees on AB InBev deal

City lawyers have taken a handsome share of the $1.94bn in advisory fees generated by Anheuser-Busch InBev’s (AB InBev) $108bn takeover of SABMiller, with law firms receiving $261m in fees from the biggest deal in British corporate history.

The deal, which sees Stella Artois, Corona and Budweiser owner AB InBev takeover brewing rival SABMiller, has generated some of the biggest advisory fees in UK history. The details were released in the scheme document for SABMiller shareholders today (26 August 2016).

AB InBev’s professional services fees accounted for $1.73bn of the $1.94bn windfall for bankers, lawyers and accountants. Of that, $725m was spent on financing arrangements, $185m on legal fees and $135m on corporate and financial brokering advice. The legal process was made more complex by a string of beer brand disposals across the US, Europe and Asia to ease the regulatory approval process with competition authorities around the world.

Freshfields Bruckhaus Deringer will take the lion’s share of AB InBev’s $185m legal fees, which the scheme circular states is based on completion of the deal, with Wall Street firms Cravath, Swaine & Moore and Sullivan & Cromwell next in line having handled the US law element. SullCrom ran the brewer’s filing with the US Securities and Exchange Commission and the US firms handled several disposals.

Clifford Chance has also been sluiced with fees, having handled AB InBev’s financing arrangements. A long list of law firms around the world were also instructed to handle local competition and tax issues.

It’s a fine swansong for Freshfields’ deal veteran Mark Rawlinson, who is departing the Magic Circle firm in October to become chairman of UK investment banking at Morgan Stanley, having led the firm’s legal advice to AB InBev alongside London head of corporate Simon Marchant and antitrust partner John Davies.

Linklaters will take the biggest share of the $76m in legal fees spent by SABMiller. Hogan Lovells should be next in line having advised the brewer on certain aspects of the deal. Hogan Lovells, which has long been SABMiller’s go-to law firm, were thought to be overlooked to run the deal, with Linklaters deemed to have more M&A firepower. Cleary Gottlieb Steen & Hamilton are regular advisers on SABMiller’s US tax issues. M&A partner Nick Rumsby and Charlie Jacobs, who was recently chosen by the Linklaters partnership to succeed Robert Elliott as senior partner later this year, led the advice to SABMiller.

The fees by far surpass the £206m in fees Japan’s SoftBank and UK chip-maker ARM Holdings paid their financial advisers, lenders, lawyers and accountants on the £24.3bn deal they agreed in July. SoftBank’s legal advisers at Morrison Foerster and Freshfields received £5.5m, while ARM paid Slaughter and May and Davis Polk & Wardwell £9m for their legal advice.

Where did the fees go? 


Financial and brokering advice: $113m

Legal advice: $76m

Accounting advice: $2m

Public relations advice: $9m

Other costs and expenses: $2m

Total: $202m

AB InBev

Financial arrangements: $725m

Financial and corporate broking advice: $135m

Legal advice: $185m

Accounting advice: $15m

Public relations advice: $20m

Other professional services (including management consultants, actuaries and specialist valuers): $180m

Transaction taxes, other costs and expenses: $475m