Legal Business

Data deal: Davis Polk advises Markit on US merger

Data deal: Davis Polk advises Markit on US merger

Longstanding adviser Davis Polk & Wardwell has acted for Markit again as the London-based data provider signed a deal with US firm IHS for a $13bn merger.

Davis Polk’s team was led by New York-based Louis Goldberg and Oliver Smith, with Richard Truesdell and Mark Mendez acting on capital markets issues.

Giving tax advice were partners Michael Mollerus and Jonathan Cooklin, while executive compensation partner Jeffrey Crandall also acted on the deal.

Weil Gotshal & Manges is advising Colorado based IHS, in the deal which values Markit at $5.9bn, and is another example of a US deal which will take advantage of overseas tax base.

IHS shareholders will own about 57% of the combined company after the deal closes, and will pay $31.13 per Markit share.

Weil fielded a team across the US and the UK, led by corporate partner Michael Aiello, while tax partners Kenneth Heitner in New York and David Irvine in London also worked on the deal.

Banking and finance partner Allison Liff, capital markets partner Heather Emmel, executive compensation & benefits partner Paul Wessel all advised for Weil, while Washington DC antitrust partner John Scribner advised with technology partner Charan Sandhu.

Davis Polk has advised Markit on several mandates including its $1.5bn IPO, when the company listed shares on the Nasdaq exchange. The offering was the largest US IPO by a European issuer in 2014.

The firm also acted for Markit in 2015, when it repurchased $200m of its common shares, in a deal which is to be completed by the third quarter of this year. Also in 2015, Davis Polk advised Markit in connection with its SEC-registered secondary offering of 27m shares, which raised $685m.

Markit has turned to Proskauer Rose in the past when the data provider, alongside a dozen major banks, was accused by investors of rigging the credit derivatives market. The case resulted in a $1.87bn settlement.

victoria.young@legalease.co.uk

Legal Business

New York slowdown: Weil Gotshal revenue flat again as Davis Polk’s strong run comes to an end

New York slowdown: Weil Gotshal revenue flat again as Davis Polk’s strong run comes to an end

New York elite firms Weil, Gotshal & Manges and Davis Polk & Wardwell struggled to achieve meaningful growth last year, with Weil’s haul of $1.16bn in 2015 still behind what the firm generated in 2011.

Similarly, growth at Davis Polk stuttered in 2015 after notching double-digit growth in 2014 to break the $1bn barrier. Impacted by the drop-off in financial crisis-related litigation and a cooling in the capital markets space at the back-end of 2015 following the stock market turmoil in China, revenue dipped slightly to $1.07bn.

This equates to a $20m fall in revenue, ending a rapid period of growth for Davis Polk that saw it increase revenue by 27% between 2009 and 2014.

New York rival Weil posted a 1% rise in revenue to $1.16bn in 2015, continuing a period of slow growth. While last year saw a marked increase in activity levels within its cornerstone bankruptcy practice, turnover at the firm is down 5% over the past five years, having generated $1.23bn in 2011.

The number of lawyers at Weil, which laid off more than 150 people in 2013, shrunk for the third consecutive year to 1,063 in 2015. A reduction in the number of equity partners at the firm also helped to push up profitability, with profits per equity partner (PEP) up by 5% to $2.52m.

PEP at Davis Polk, meanwhile, was 1% up on 2014 to $3.33m last year.

Other US firms to post results this reporting season include White & Case, which also reported flat revenues up 1% to $1.524bn, while Cooley’s financials for 2015 show revenue has risen 14% to $912m. Hogan Lovells continues to post modest financial growth as its results showed revenue for the calendar year increased by 2.3% to $1.82bn.

tom.moore@legalease.co.uk

 

 

Legal Business

Simpson Thacher, Davis Polk and Bär & Karrer win mandates on $43bn ChemChina-Syngenta deal

Simpson Thacher, Davis Polk and Bär & Karrer win mandates on $43bn ChemChina-Syngenta deal

Simpson Thacher & Bartlett, Davis Polk & Wardwell, and Swiss firm Bär & Karrer have landed key advisory roles on China National Chemical Corp’s (ChemChina’s) $43bn bid for Swiss seeds and pesticides group Syngenta, in what will be the largest ever acquisition by a Chinese firm.

Simpson Thacher is advising China’s state-owned ChemChina on M&A, acquisition finance and regulatory aspects with a team led by partners Alan Klein, Shaolin Luo, Chris May and Sinead O’Shea, alongside Homburger.

Davis Polk & Wardwell and local Swiss firm Bär & Karrer are acting for Syngenta.

HSBC is arranging the debt financing for the deal, with advice from Linklaters, who is acting with a team led by London banking partner Brian Gray. Clifford Chance is advising ChemChina’s financial adviser China CITIC Bank with a team led by Maggie Lo.

Clifford Chance has acted for ChemChina in the past, advising on its $7.7bn bid to buy Italian tire-maker Pirelli. The deal announced last year, gave Chinese investors a significant foothold in Italy’s manufacturing industry while signalling continued Chinese investment into Europe. Davis Polk and Bär & Karrer previously worked together advising Syngenta in its defence of a takeover proposal by agriculture company Monsanto.

Syngenta said today (3 February) that the agreed offer amounted to $465 a share, plus a special dividend of 5 Swiss francs ($4.91) a share to be paid immediately before the deal’s closing. The company also announced that a ‘future initial public offering is intended’ while the transaction will ‘enable further expansion of Syngenta’s presence in emerging markets and notably in China.’

sarah.downey@legalease.co.uk

Legal Business

Dealwatch: Davis Polk and Simpson Thacher lead as AstraZeneca takes over ZS Pharma for $2.7bn

Dealwatch: Davis Polk and Simpson Thacher lead as AstraZeneca takes over ZS Pharma for $2.7bn

Wall Street leaders Davis Polk & Wardell and Simpson Thacher & Bartlett are lead advisers on Anglo-Swedish pharma giant AstraZeneca’s $2.7bn acquisition of California-based biopharmaceutical company ZS Pharma.

The deal is the latest in a wave of takeover deals in the healthcare industry, including the potential $100bn merger of AstraZeneca and Pfizer, which came to a halt last year. Last week Dublin-based Shire moved to acquire US firm Dyax for $5.9bn, in a deal which Ropes & Gray‎, Slaughter and May, Davis Polk and Sullivan & Cromwell all advised on.

Under this latest agreement, AstraZeneca will acquire all of the outstanding capital stock of ZS Pharma for $90 per share in an all-cash transaction.

Davis Polk’s team out of New York represented AstraZeneca, comprising corporate partners Marc Williams and Brian Wolfe, partner Edmond FitzGerald for compensation advice, tax partner Neil Barr and Joel Cohen on antitrust and competition issues

ZS Pharma instructed Simpson Thacher with corporate partners Kevin Kennedy and Kirsten Jensen, employment partner Tristan Brown, tax partner Katharine Moir and IP partner Noah Leibowitz.

The transaction is expected to close by the end of 2015.

AstraZeneca has used a range of firms in the past, including RPC on its move to a new headquarters in Cambridge in 2013, and Covington & Burling when it purchased Spanish healthcare group Almirall for $2.1bn in 2014.

jaishree.kalia@legalease.co.uk

 

 

 

Legal Business

The conservation game – up close with New York’s original inner circle

The conservation game – up close with New York’s original inner circle

Amid a changing global legal market, three storied Wall Street firms retain commanding reputations. Legal Business assesses New York law’s enduring inner circle.

Almost all absurdity of conduct arises from the imitation of those whom we cannot resemble.
Samuel Johnson

Legal Business

Deal watch: Corporate activity in April 2015

Deal watch: Corporate activity in April 2015

GE RESTRUCTURING BRINGS IN RAFT OF ADVISERS

A host of firms picked up work on General Electric (GE)’s restructuring, fielding large cross-border teams as the industrial giant sold $26.5bn of real estate assets and announced it would divest most of GE Capital’s other holdings. Hogan Lovells led for GE on the real estate sale, with buyers The Blackstone Group and Wells Fargo represented by Simpson Thacher & Bartlett and Dechert respectively.

Weil, Gotshal & Manges is advising GE on the wider restructuring, which will return up to $90bn to shareholders, alongside Sullivan & Cromwell and Davis Polk & Wardwell.

Legal Business

Significant mandates: Hogan Lovells among raft of firms on GE’s financial restructuring

Significant mandates: Hogan Lovells among raft of firms on GE’s financial restructuring

Hogan Lovells plus a host of US firms have won roles on GE’s major financial restructuring, including the $26.5bn sale of its real estate assets, as it tries to create a ‘simpler and more valuable company’ by selling most of GE Capital’s assets.

Under the agreement, GE will sell the bulk of the GE Capital Real Estate assets – in what has been dubbed one of the largest real estate deals on record – to funds managed by Blackstone with Wells Fargo also acquiring a portion of the performing loans at closing. The company also has letters of intent with other buyers for an additional $4bn of commercial real estate assets, totalling a $26.5bn disposal.

Hogan Lovells’ cross-border team, which comprised over 75 lawyers, advised GE on the real estate sale led by partners Warren Gorrell, Bruce Gil‎christ, Prentiss Feagles, Lauren Bellerjeau, Waajid Siddiqui and Lee Berner, based in New York and Washington DC. The GE legal team was led by former Hogan Lovells partner Mark Landis, currently executive legal counsel–M&A at the company.

On the other side was Dechert representing Wells Fargo with US based partner Richard Jones leading, alongside London-based Jeremy Trinder, Jason Butwick, Mark Stapleton plus US partners Kahlil Yearwood, Philippe Phaneuf, David Linder, Daniel Dunn and, out of France, Philippe Thomas.

Simpson Thacher & Bartlett represented Blackstone with partners Greg Ressa, Sas Mehrara and Krista Miniutti leading. Bank of America and Kimberlite Advisors provided financial advice on the real estate deal.

On the wider restructuring of the business GE took advice from Weil, Gotshal & Manges on corporate and restructuring matters with Sullivan & Cromwell advising on the regulatory aspects led by Sullivan’s senior chairman Rodgin Cohen. 

Davis Polk & Wardwell led on tax matters for the company with a team including corporate partners Richard Sandler and John Meade, tax partners Neil Barr, Michael Farber and Michael Mollerus, partners Randall Guynn and Luigi de Ghenghi handling regulatory matters and investment management partners Nora Jordan and Gregory Rowland. 

GE expects to return more than $90bn to investors through to 2018, the majority of which will come from the $50bn share repurchase program with the remainder generated from the current dividend and the spinoff of its remaining 85% stake in Synchrony. The company expects that by 2018 over 90% of its earnings will be generated by its high-return industrial businesses, up from 58% last year.

jaishree.kalia@legalease.co.uk

Legal Business

US revenue round-up: Paul Weiss and Davis Polk surpass the billion-dollar mark

US revenue round-up: Paul Weiss and Davis Polk surpass the billion-dollar mark

US firms’ financials are continuing their positive trend, with recent releases showing revenue spikes and profit boosts including for Davis Polk & Wardwell and Paul, Weiss, Rifkind, Wharton & Garrison which both broke the billion-dollar mark in gross revenues last year.

For Davis Polk, both its revenue and partner profits were significantly higher; revenue was up 12.8% from $975m in 2013 to $1.1bn last year, while its average profits per partner crossed the three-million-dollar threshold to $3.3m, rising 12%. The positive result is a fundamental boost for the firm that was widely perceived to have drifted off course during the 2000s.

Similarly, disputes leader Paul Weiss has particularly outshone competitors enjoying its 15th record-breaking year in revenues in a row. Gross turnover surged to $1.03bn, up 11% from when the firm grossed $934.5m in 2013 and lifting average partner profits by 6% from $3.6m to $3.8m in 2014. The firm’s overall headcount rose 10% percent from 854 to 943, while partner ranks grew by just four heads to 135, a more modest 3% rise.

Since the credit crunch hit, Paul Weiss is one of the few firms that has managed to keep revenues well above water. Speaking to Legal Business earlier this year, Paul Weiss chairman Brad Karp said: ‘Breaking the billion-dollar revenue mark in 2014 was a very significant milestone for us. We are very proud of what we have accomplished – not just in 2014, but in the seven years since the financial crisis began. Over that period, our revenues have increased by 60%, our profitability has increased by 50%, and our pro bono hours have increased by more than 50%.’

Also enjoying double-digit growth so far this was energy focused Houston firm Baker Botts, which recently saw its revenue shoot up 11.4% to $653m from $586m in 2013, while net income soared 22.6% to $299.3m. But it was the firms’ profits per partner that truly shone at $1.7m – a 25.5% increase on 2013’s $1.36m – this was after the firm posted flat partner profits in 2013.

‘2014 was an exceptional year,’ said the firm’s managing partner Andrew Baker. ‘We achieved these results while making sizable new investments in our long term growth in the form of substantial new marketing, business development, practice management, pricing and information technology systems.’

jaishree.kalia@legalease.co.uk

For more analysis of the surging US market see: The blessed – unheralded, Wall Street’s elite comes roaring back

Legal Business

World’s largest airport operator: Mayer Brown and Davis Polk help Spain’s €4.3bn AENA float take-off

World’s largest airport operator: Mayer Brown and Davis Polk help Spain’s €4.3bn AENA float take-off

Mayer Brown and Davis Polk & Wardwell have won roles advising Spanish airport operator Aena (Aeropuertos Españoles y Navegación Aérea) on its €4.3bn float on the Madrid Stock Exchange.

The Spanish government sold its 49% stake in Aena, the world’s largest airport operator with some 47 airports worldwide, to raise €4.3bn, giving the group a total equity value of up to €8.7bn.

Mayer Brown’s London based banking and finance partner Robert Flanigan advised Aena alongside partner George Baptista out of New York, while local firm Pérez-Llorca’s capital markets head Vicente Conde also advised the airports operator.

Madrid-based corporate partner Michael Willisch at Davis Polk advised the underwriters including Goldman Sachs, Morgan Stanley, and Bank of America Merrill Lynch while Uría Menéndez corporate partner Alfonso Ventoso also acted for the underwriters.

In what is the largest floatation on the Madrid stock market since the onset of the financial crisis, the initial public offering (IPO) has shown signs of a sustained economic recovery in Spain.

The group had originally intended to float in the fourth quarter of 2014, however the IPO was put on hold after the Spanish government decided to re-appoint an auditor through a public tender process. Following the procurement process the auditor was switched from PwC to Ernst & Young (EY) with the delay working well for the government which at the end of 2014 was expecting to raise around €3.8bn.

jaishree.kalia@legalease.co.uk

Legal Business

Slaughters, Davis Polk and Skadden cash in on Shire’s biggest ever takeover

Slaughters, Davis Polk and Skadden cash in on Shire’s biggest ever takeover

Dublin-headquartered Shire, took to the January sales with the $1.5bn it received in a break-fee from US pharma giant AbbVie following the collapse of their proposed $55bn tie-up late last year, securing the acquisition of biotech firm NPS Pharma.

The company returned to Slaughter and May, which drafted the AbbVie break-fee due to the political climate around tax inversion deals, to advise on the purchase of biotech NPS for $5.2bn. The deal is Shire’s largest-ever acquisition and comes amid increased pressure to deliver shareholder value.