Legal Business Blogs

Slaughters and Links lead on £3bn Carillion/Balfour talks; HSF and A&O advise on BSkyB’s £7.4bn European acquisitions

Construction group Carillion has instructed Slaughter and May’s corporate heavy hitter William Underhill and fellow corporate partner Kathy Hughes to advise on a proposed £3bn merger with UK rival Balfour Beatty, which has turned to Linklaters’ M&A veteran and longstanding adviser Iain Fenn.

The deal comes as today (25 July) also saw BSkyB conclude a £7.4bn deal to buy European sister companies Sky Deutschland and Sky Italia from 21st Century Fox, with Herbert Smith Freehills (HSF) leading for BSkyB and Allen & Overy (A&O) for Rupert Murdoch’s multinational media corporation.

If the Carillion Balfour talks are successful the merger, which is likely to be scrutinised by the UK’s Competition Commission, will create the largest construction and engineering company in the UK.

Carillion is also a longstanding client of Underhill (pictured), adviser to Royal Mail on its high profile IPO, who has handled a large slice of Carillion’s corporate work over the past decade, including its £291m acquisition of civil engineering firm Mowlem in 2005.

Slaughter and May have formed a close client relationship with Carillion, which in 2013 turned over £4.1 billion, including offering the services of Carillion’s low-cost legal arm to key client Vodafone.

Fenn, meanwhile, last year advised Balfour Beatty on its £190m sale of its UK facilities management arm to French energy group GDF Suez Energy in an attempt to reduce debt and focus on major infrastructure projects. He is well known for his work for Vodafone and advised the company on its £6.6bn acquisition of German cable group Kabel Deutschland last year.

Confirming the talks today (25 July) Balfour Beatty and Carillion said in a joint statement that they are working on a strategy and business plan for a combined entity, which will be ‘underpinned by the evaluation of achievable synergies, future financing arrangements and a number of other essential supporting workstreams’.

The construction duo now have until 21 August to complete the deal under the UK Takeover Code.

Elsewhere, BSkyB has turned to relationship partner Stephen Wilkinson to advise on the acquisition of Rupert Murdoch’s pay TV companies in Germany and Italy, creating one of Europe’s largest pay TV providers. Wilkinson, who also advised BSkyB in the £481m sale of its stake in ITV to Liberty Global earlier this week, was flanked by M&A partner Malcolm Lombers, equity capital markets partner Chris Haynes, Brussels-based competition partner Kyriakos Fountoukakos and IP partner Joel Smith.

HSF teamed up with Hengeler Muller’s Klaus-Dieter Stephan to complete the £2.9bn purchase of Sky Deutschland, acquiring a 57.4% stake from US media group Fox, with an offer put in for the outstanding shares to the remaining minority shareholders. On the £2.45bn acquisition of Fox’s 100% stake in Sky Italia, HSF worked alongside Bruno Bartocci of Italian firm Legance on local law.

BSkyB’s in-house team was spearheaded by deputy general counsel Andrew Middleton and principle legal adviser Sianne Walsh.

Wilkinson told Legal Business: ‘The deal was a complex, marrying the German public offer system with a private acquisition and stitching the transactions together as an integrated deal.’

For 21st Century Fox the A&O team was led by London corporate partners Andrew Ballheimer and Simon Toms, with a team made up of London corporate partners and German corporate partners Oliver Seiler and Hans Diekmann and the firm’s co-head of competition Antonio Bavasso. Milan-based corporate partner Paolo Ghiglione worked alongside Italian firm Duccio Regoli of Mazzoni e Associati to complete the Italian end of the deal.