Legal Business

Freshfields and Davis Polk win key roles as Comcast looks to thwart Murdoch’s Sky bid

Freshfields and Davis Polk win key roles as Comcast looks to thwart Murdoch’s Sky bid

Freshfields Bruckhaus Deringer and Davis Polk & Wardwell have landed pivotal roles as Comcast seeks to disrupt an existing bid from Rupert Murdoch’s 21st Century Fox to buy out European satellite broadcaster Sky.

The London-based Freshfields team advising Comcast comprises M&A partners Julian Long and Alison Smith, City competition partners John Davies and Michele Davis, and London employment partner Alice Greenwell.

Legal Business

Freshfields and Davis Polk win roles as Comcast eyes Sky with ‘superior’ £22bn bid

Freshfields and Davis Polk win roles as Comcast eyes Sky with ‘superior’ £22bn bid

Broadcasting giant Comcast has instructed Freshfields Bruckhaus Deringer and Davis Polk & Wardwell as it looks to trounce an existing offer for Sky from Rupert Murdoch-owned 21st Century Fox.

Philadelphia-headquartered Comcast said in a statement today (27 February) that its ‘superior cash proposal of £12.50 per share represents a 16% increase in value over the existing 21st Century Fox offer for Sky’.

The proposed offer from Comcast implies an equity value of £22bn ($31bn), compared with a bid from 21st Century Fox in December 2016 to buy the remaining 61% of Sky it didn’t already own. That bid valued Sky at £18.5bn and £10.75 per share.

Advising the bidder, the London-based Freshfields team is being led by M&A partners Julian Long and Alison Smith, City competition partners John Davies and Michelle Davis and London employment partner Alice Greenwell.

Meanwhile, Davis Polk is also advising longstanding client Comcast with a team led by New York managing partner Tom Reid and including London corporate partner Will Pearce and New York corporate partner Brian Wolfe.

Davis Polk partners Michael Kaplan and Reuven Young (securities), Jason Kyrwood and Nick Benham (debt financing), Neil Barr and Jonathan Cooklin (tax) and Arthur Burke (antitrust) are also advising.

As lead advisers to 21st Century Fox, Allen & Overy’s team is led by co-head of antitrust Antonio Bavasso, corporate partner David Broadley and M&A partners Seth Jones and Simon Toms.

Also advising 21st Century Fox are New York corporate partners Howard Ellin and Brandon Van Dyke from Skadden, Arps, Slate, Meagher & Flom, as well as  Simpson Thacher & Bartlett partners Patrick Ryan and Sinead O’Shea.

Sky, meanwhile, is advised by Herbert Smith Freehills, with a team led by M&A partner Stephen Wilkinson.

News Corp made an £8bn takeover bid for Sky back in 2010, which was then retracted in 2011 while the phone-hacking trial was conducted. Regulatory concerns regarding media ownership have also been raised regarding combining Murdoch’s News Corp media giant with Europe’s largest pay-TV broadcaster.

HSF and A&O also led for Sky and 21st Century Fox in 2014, when Sky (then called BskyB) concluded a deal worth up to £7.4bn to buy European sister companies Sky Deutschland and Sky Italia from 21st Century Fox.

Brian Roberts, chairman and CEO of Comcast Corporation said: ‘Comcast intends to use Sky as a platform for growth in Europe. We already have a strong presence in London through our NBCUniversal international operations, and we intend to maintain Sky’s UK headquarters.

‘Adding Sky to the Comcast family of businesses will increase our international revenues from 9% to 25% of company revenues.’

nathalie.tidman@legalease.co.uk

Legal Business

Linklaters advises L’Oreal on €1bn sale of The Body Shop alongside Baker McKenzie and Davis Polk

Linklaters advises L’Oreal on €1bn sale of The Body Shop alongside Baker McKenzie and Davis Polk

Linklaters, Davis Polk & Wardwell and Baker McKenzie are advising as L’Oreal looks to sell The Body shop for €1bn to Brazilian cosmetic company Natura.

Natura is in exclusive negotiations with L’Oreal, which put The Body Shop up for sale in February after it bought the business in 2006 for £652m.

The world’s largest cosmetics company announced the decision following a fall in The Body Shop’s operating profits, which sat at €34m at year end in 2016, down a 38% from €55m the previous year. The deal is expected to close later this year.

London and Paris-based Linklaters corporate partner Vincent Ponsonnaille (pictured) led the Linklaters team advising L’Oreal, which included London banking partner Naidenov and Paris corporate partner Laurent Victor-Michel. The cosmetic company also instructed Baker McKenzie with a team led by London Funds partner James Burdett.

Natura turned to Davis Polk for advice, with Jacques Naquet-Radiguet leading the firm’s team.

L’Oreal previously turned to Linklaters for advice in its original purchase of The Body Shop, with London-based Corporate partner Richard Godden leading the Linklaters team. Baker McKenzie advised The Body Shop on the deal.

The Magic Circle firm also advised L’Oreal over its buyout of China-based cosmetic mask manufacturer Magic Holdings International for around $845m in 2014. Paris-based corporate partner Bruno Derieux led the team. 

Madeleine.farman@legalease.co.uk

Legal Business

Davis Polk and Kirkland latest to pare back Hong Kong practices as US firm exits continue

Davis Polk and Kirkland latest to pare back Hong Kong practices as US firm exits continue

Firms retreat as funds raised through IPOs in the region fall 26%

Davis Polk & Wardwell and Kirkland & Ellis are the latest US firms to lose corporate partners from their Hong Kong offices as public listings in the region decline.

Legal Business

In-house: Davis Polk added to HSBC global roster as firms retain places

In-house: Davis Polk added to HSBC global roster as firms retain places

US giant Davis, Polk & Wardwell has won a spot on HSBC’s global legal panel as a host of firms retain their places.

Magic Circle firms Allen & Overy, Clifford Chance, Freshfields Bruckhaus Deringer and Linklaters all retained their places, while global firm Norton Rose Fulbright also kept its place on the legal line up.

The bank last reviewed its panel in 2012, when it expanded its roster to include a US group of firms including Cleary Gottlieb Steen & Hamilton, Latham & Watkins and Mayer Brown.

Norton Rose retained its spot on the panel despite recently losing a panel spot with Lloyds Banking Group. Recent mandates include advising on a HK$1.3bn real estate issuance of shares by investment company South East Group in Hong Kong last year.

In the Magic Circle, Linklaters acted on a $5.2bn sale in Brazil for the bank, led by corporate head Aedamar Comiskey, while Freshfields has advised HSBC on its $1.9bn settlement with US authorities over money laundering and on a recent inquiry by the Competition and Markets Authority.

The expansion of the panel comes after other banks have looked to trim their line ups. In October, Legal Business revealed Lloyds Banking Group had cut its group from ten to eight as DLA Piper and Norton Rose lost their spots.

HSBC’s legal team is led by chief legal officer Stuart Levey who joined the bank in 2012. His hire was part of HSBC’s restructure of its new leadership board and reform of its global strategy.

Recognised in the GC Powerlist, Levey has reorganised the bank’s global legal function in order to align it more closely to the bank’s global businesses and made key new hires to enhance its focus on preventing future reputational problems.

matthew.field@legalease.co.uk

Read more on panel appointments in: ‘A buyers’ market – The trends and traumas in adviser reviews’

Legal Business

US bonuses: Simpson and Davis Polk match Cravath rewards of up to $100,000 for associates

US bonuses: Simpson and Davis Polk match Cravath rewards of up to $100,000 for associates

Leading Wall Street firms have begun announcing their 2016 year-end associate bonuses with Cravath, Swaine & Moore leading the way again on rewards with other Manhattan firms following suit.

According to Above the Law, Cravath associates were told their year-end bonuses on Monday afternoon (27 November). Newly qualified associates in 2016 and 2015 will receive $15,000.

The bonus scale means 2014 associates will receive $25,000, 2013 will receive $50,000, while associates from 2009 will earn up to $100,000 in bonuses. The scale remains on a par with last years’ US bonuses.

After Cravath announced its new bonus round, Simpson Thacher & Bartlett and Davis Polk & Wardwell both matched their New York rival.

This summer saw a US pay war launched as leading firms rushed to match the $180,000 on offer for Cravath’s new associates. The firm boosted pay for the first time since 2007 in a move that saw first year associates take home an extra $20,000.

A host of US firms followed suit, including Milbank, Tweed, Hadley & McCloy; Paul Weiss, Rifkind, Wharton & Garrison; and Weil Gotshal & Manges.

Magic Circle firms were also pushed to compete with US rivals on the latest pay scale, as Freshfields Bruckhaus Deringer and Clifford Chance both bringing up the salaries for US-based associates, bringing it in line with the $180,000 pay scale.

Last year in the UK, Slaughter and May upped the ante for bonus levels amid fierce competition from US players. Slaughters lifted bonuses between 9% and 16%, allowing high-performing junior lawyers to take home an extra £15,000.

matthew.field@legalease.co.uk

Legal Business

Clifford Chance and Davis Polk deliver $8bn Hong Kong IPO for Postal Savings Bank

Clifford Chance and Davis Polk deliver $8bn Hong Kong IPO for Postal Savings Bank

Clifford Chance, Davis Polk & Wardwell, King & Wood Mallesons and Chinese law firm Haiwen & Partners have advised on the year’s largest initial public offering (IPO) of $8bn for Postal Savings Bank of China launched today (14 September).

US firm Davis Polk advised state-owned Postal Savings Bank on the float on the Hong Kong Stock Exchange with Haiwen acting as Chinese counsel on the deal.

Magic Circle firm Clifford Chance advised the underwriters China International Capital Corporation, Morgan Stanley, Bank of America Merrill Lynch, Goldman Sachs and JP Morgan as joint sponsors on the Hong Kong Stock Exchange, while King & Wood Mallesons acted as Chinese counsel to the banks.

Clifford Chance’s team was led by China co-managing partner Tim Wang with Hong Kong partners Amy Lo and Fang Liu, supported by Singapore-based Jean Thio.

Postal Savings Bank has more than 40,000 branches across China and more than 500 million retail customers.

The bank’s IPO is the largest share offering globally so far in 2016. The deal is the largest IPO since the record breaking offering on the New York Stock Exchange of Chinese e-commerce giant Alibaba, which raised more than $25bn as the largest such deal in history.

Clifford Chance’s China team has advised on several major Hong Kong IPOs this year, including the float of China Everbright Securities for $1.1bn and Bank of Tianjin for $990m.

Other major IPO mandates this year have seen Linklaters and Clifford Chance act on the float of Metro Bank in March, valuing the bank at around £1.6bn.

In January, Clifford Chance, Linklaters, Allen & Overy and King & Wood Mallesons all advised on the proposed IPO of Clydesdale and Yorkshire Bank.

matthew.field@legalease.co.uk

Legal Business

Slaughters and Davis Polk face off as MasterCard buys UK payments firm

Slaughters and Davis Polk face off as MasterCard buys UK payments firm

Slaughter and May rubbed shoulders with Davis Polk & Wardwell in the second major announced deal this week, this time opposite the Wall Street firm on the acquisition of British payments system company VocaLink by New York-based MasterCard.

MasterCard said it will buy a 92% stake in VocaLink, for around £700m, in a bid to strengthen its presence in the UK. London-based VocaLink offers payment processing services, including the LINK cash machine network.

VocaLink was owned by several banks, including Barclays, Royal Bank of Scotland, Lloyds, Santander and HSBC, which were told by the Payments System Regulator to sell their stakes in February this year.

The FCA subsidiary said the banks’ ownership of VocaLink, which processes over 90% of salaries, more than 70% of household bills and almost all state benefits, was harming competition and innovation.

Slaughters team on the deal was led by corporate partner Rebecca Cousin with the newly-promoted Victoria MacDuff and M&A head Roland Turnill. IP and IT partner David Ives, tax partner Jeanette Zaman and head of pensions Jonathan Fenn also acted on the takeover, along with real estate partner Jane Edwarde and finance partner Azadeh Nassiri.

The Magic Circle firm already advised VocaLink in April as the company separated its LINK network of cash machines from VocaLink and renegotiated VocaLink’s processing contract with LINK and its members.

Davis Polk’s team was led by Will Pearce with executive pay advice from Jeffrey Crandall, IP and IT advice from Pritesh Shah and regulatory guidance from Angela Burgess. Tax partner Jonathan Cooklin also acting on the deal.

Similarly Davis Polk advised MasterCard last year on its $600m acquisition of cloud-based analytics firm Applied Predictive Technologies.

Hogan Lovells advised the senior executive management of VocaLink with a team led by global head of PE Tom Whelan with partners Keith Woodhouse and Nick Atkins.

MasterCard is currently facing the biggest UK legal claim ever as Quinn Emanuel Urquhart & Sullivan leads a US-style class action worth £19bn on behalf of British debit and credit card users hit with ‘illegal’ charges.

The sale of VocaLink to US owners follows Cambridge-based ARM Holdings announcing its takeover by Japanese telecoms group Softbank for £24.3bn.

victoria.young@legalease.co.uk

Legal Business

Deal watch: Corporate activity in April 2016

Deal watch: Corporate activity in April 2016

FORSTERS AND SLAUGHTERS LEAD ON TATA STEEL SELL OFF

Forsters and Slaughter and May acted on Greybull Capital’s rescue deal to buy Tata Steel’s European long products business, which includes the Scunthorpe steel works employing 3,500 people. Slaughters advised Tata, while Forsters acted for family office Greybull.

Legal Business

Simpson Thacher tops first quarter global deal tables, as Davis Polk dominates Europe

Simpson Thacher tops first quarter global deal tables, as Davis Polk dominates Europe

Despite a looming Brexit referendum swaying levels of transactional activity, certain law firms are enjoying a healthy pipeline of deals with Simpson Thacher & Bartlett emerging on top for global M&A deal value in Q1 2016.

According to Dealogic data, the firm worked on $101bn worth of deals at announcement, a total of 26, constituting 13% of market share. Major mandates under its belt include advising on China National Chemical Corp’s $43bn bid for Swiss seeds and pesticides group Syngenta, in what will be the largest ever acquisition by a Chinese firm; and acting on the $16.5bn merger of industrial company Johnson Controls and security provider Tyco.

While M&A rankings are notoriously hard to interpret, with US securities and secondary roles typically inflating the position of non-European law firms, such figures support the argument that US-bred advisers are steadily pushing into premium deal work in the region.

Other firms to appear in the global top ten for the first quarter included Davis Polk & Wardwell in third place with $77bn worth of deals, Jones Day in fifth with $57bn, and Freshfields Bruckhaus Deringer with $49bn worth of deals.

For European M&A lawyer rankings, US firm Davis Polk & Wardwell took the lion’s share with $59bn worth of deals, followed by Fangda Partners at $51bn, Homburger in third at $50bn, Simpson Thacher in fourth at just under $50bn. Magic Circle firms Freshfields and Allen & Overy placed seventh and ninth respectively while Weil Gotshal & Manges took the tenth spot with $12bn worth of deals.

For US M&A rankings Simpson Thacher also came top, with $51bn worth of deals, a total of 17, and marking 16% of market share. Jones Day came second with deals valuing at $47bn, a total of 81, and constituting 14% of market share. Other firms in the top ten included Weil Gotshal in third, Wachtell Lipton Rosen & Katz in fourth, and Kirkland & Ellis in fifth place.

On European activity levels, Weil Gotshal co-head of private equity Marco Compagnoni told Legal Business: ‘It started slow in the New Year and then picked up towards February and March. Activity levels have been good but are taking a lot longer to do. I can’t work out the effect of Brexit on people’s minds. When you talk to people I think they assume it’s not going to happen – but when they’re looking for reasons not to do something, it hangs in the air.’

‘There’s not much about of your classic UK buy out – there’s loads of deals being done in the Baltics or Italy – a lot of interest in privatisation and transactions involving public companies. We’re getting a lot of inquiries about that. How sustainable that will be? I don’t have a lot of visibility to feel raging confidence. Not a huge amount of activity in industrials but a lot of stuff in financial services and TMT.’

sarah.downey@legalease.co.uk

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