Legal Business

Baker & McKenzie acts for Bain and Brakes Group again as food distributor sells to US firm in $3.1bn deal

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Dealwatch Baker McKenzieFreshfields Bruckhaus Deringer
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Baker & McKenzie and Freshfields Bruckhaus Deringer have picked up roles as US company Sysco Corp moves to buy London food distributor Brakes Group from Bain Capital.

Magic Circle firm Freshfields is advising Sysco, the largest food distributor in the US, on a $3.1bn deal to buy the European food distributor and expand its presence to the United Kingdom, Ireland, France, Sweden, Spain, Belgium and Luxembourg.

Freshfields’ cross-border mergers and acquisitions specialist Piers Prichard Jones advised Sysco Corp from London, with assistance from Freshfields’ US head of corporate Matthew Herman.

Brakes Group and Bain Capital has engaged Baker & McKenzie to act on the deal. The firm’s head of private equity David Allen is leading a team on the transaction.

Baker & McKenzie has previously advised Bain Capital and Brakes Group on a number of transactions, including the merger of Fresh Direct with the M&J Seafood, Pauleys and Wild Harvest divisions of Brakes. The firm also advised Bain Capital and Brakes Group’s acquisition of Davigel from Nestlé.

The deal, subject to regulatory review by European Union competition authorities, is expected to be completed before the end of Sysco’s fiscal year in July 2016.

The combined companies are expected to generate annualised sales of approximately $55bn, with Sysco agreeing to take on the repayment of approximately $2.3bn of Brakes Group’s financial debt.

Freshfields had a bumper year in M&A last year, with Dealogic’s 2015 league tables recording the firm secured 190 deals worth $587.6bn. Freshfields also retained its title as top firm in the European attorney rankings, advising on $418.4bn worth of deals.

madeleine.farman@legalease.co.uk

Legal Business

Freshfields top-paid member takes home £3.2m in 2015, 68% more than year before

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Freshfields Bruckhaus Deringer‘s highest-paid LLP member took home 68% more last year, pocketing £3.2m at the end of the 2014/15 financial year, compared to £1.9m the previous year.

The firm’s LLP accounts said the profit and remuneration for the top-paid member includes payments in relation to that member’s retirement from the firm.

The increase in pay is a stark difference to what was paid in the 2013/14 financial year when the filings revealed that the highest paid member, including payments relating to retirement, took a 24% drop from £2.5m in 2013 to £1.9m. In 2014, Freshfields had 334 members on average.

In 2014/15, fee earning staff headcount rose 2.7% to 2,640 while secretarial and support staff increased 3.5% to 2,119. Overall headcount grew by more or less the same mark from 4,621 to 4,759 by 3%.

Overall staff costs at the firm increased by 2.7% from £547.7m to £562.7m despite salary and social security costs falling 1% and 5% respectively, while other staff costs rose 24% from £48.5m to £60.2m.

Revenue at the firm was more or less flat around the £1.3bn mark, while profit for the year before members’ remuneration and profit shares rose very slightly to £511.8m from £509.7m. However the profit available for discretionary division amongst members fell 13% from £552.1m to £481.3m, while profit for the year before partner annuities also dropped 4% to £506.3m from £527.6m.

For more on Freshfields see: The last champions – meet the leaders intent on sealing Freshfields’ place in the global elite

jaishree.kalia@legalease.co.uk

Legal Business

Lockstep transfer: Freshfields Japan partners face profit cut as part of global review

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Freshfields Bruckhaus Deringer is set to transfer partners in its Tokyo office from its traditional lockstep to its second-tier lockstep as part of a global profit review, Legal Business understands.

The move is expected to affect seven partners, including four practice heads, from the 31-strong office.

The review, which kicked off last year, was initially set to affect partners in non-core practice areas and smaller offices globally, is to also impact equity partners at the firm’s Fleet Street headquarters, notably in the employment and IP practices.

The move comes after the partnership approved the introduction of a second tier lockstep two years ago. The second ladder runs from 10-30 points and sits alongside the traditional 17.5-50-point ladder, which the majority of partners are currently on.

At that time, Freshfields – which had more than 400 partners – abolished its non-equity partner roles and transferred them on to the second ladder, which affected around 35 salaried partners. This increase in equity partner numbers drove down the firm’s profit per equity partner for the 2014/15 financial year by 8% to £1.37m. The change came as LB100 firms reviewed their partnership models following HMRC rule changes for LLPs. 

One partner at the Magic Circle firm said the profitability drive was not performance based but directed at certain practice areas and geographies. ‘There are some local offices that would love to pay less and be able to grow their office. Not everyone wants to be paid more because then they can’t hire or promote anybody,’ said the partner.

The profitability drive comes after the firm rejected the idea of introducing three separate profit pools for the UK/Europe, Asia and the US in 2014, to allow smaller and less profitable offices to set more realistic targets in accordance to market conditions.

Freshfields would not comment on the changes.

For more on Freshfields, see the feature: ‘The last champions – meet the leaders intent on sealing Freshfields’ place in the global elite’

jaishree.kalia@legalease.co.uk

Legal Business

Taking silk: Quinn, Gibson and Freshfields heavyweights among new QCs in 107-strong round

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The Bar Freshfields Bruckhaus DeringerGibson, Dunn & CrutcherQuinn Emanuel Urquhart & Sullivan
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A trio of City heavyweights has been appointed among 107 new Queen’s Counsel (QC) announced today (11 January), an increase on last year’s round of 93. 

Of the nine solicitor advocates who applied, there were three successful candidates, a drop on 2014/15 when five solicitor advocates were appointed. This year’s appointments include Quinn Emanuel Urquhart & Sullivan arbitration head Stephen Jagusch (pictured), Gibson, Dunn & Crutcher international arbitration group co-chair Penny Madden, and Freshfields Bruckhaus Deringer London arbitration head Nigel Rawding.

However the Queen’s Counsel Selection Panel has said the number of females applicants taking silk remains ‘stubbornly low’.

A report on the 2015/16 competition showed there were 25 successful women applicants of the 48 who applied – the same amount as last year when 25 out of 43 female applicants were successful.

Nine applicants aged over 50 were appointed, the same as last year and the youngest successful applicant is 34 years old and the oldest is 57. One of the four applicants who declared a disability was successful. In 2014-15 three applicants who declared a disability were appointed. There were nine successful applicants who declared an ethnic origin other than white out of the 32 who applied, a dip on last year in which 10 applicants out of 24 were appointed.

Figures recorded since 1995 show that while applications have fallen, the success rate of those applying has vastly improved – two decades ago only 14% of all allocations for QC were successful while today the figure stands at 45%.

Justice Secretary Michael Gove will preside over an appointment ceremony at Westminster Hall on 22 February.

Chairman of the selection panel Helen Pitcher said: ‘We remain concerned that the number of female applicants remains stubbornly low, but I am pleased that of those women who did apply, 52% were successful. While I was pleased to note a rise in BAME applicants to 14% of applications it is disappointing that the success rate for BAME applicants was lower than that for applicants as a whole.’

Other high profile names to take silk include One Crown Office Row human rights barrister Marina Wheeler, the wife of Boris Johnson, public law barrister, Shaheed Fatima from Blackstone Chambers, 39 Essex Chambers’ Justine Thornton, and Wilberforce Chambers’ Tim Penny, who recently moved to the set from the now-dissolved 11 Stone Buildings.

Roche general counsel and company secretary, Funke Abimbola, who recently published a paper on social mobility and diversity in the profession with Byfield Consultancy, tells Legal Business: ‘The talent pool of those awarded silk is generally made up of the elitist of the profession. The process of application is biased towards to those with great networks and weighty referees – and not everyone will have the time to invest in the application process. Also, the blending of the roles of solicitor-advocate and the barrister hasn’t gone far enough – there are few differences between both roles now.’

‘As for the female diversity stats, this is just evident of stats at the senior end of the Bar generally. The Bar is, however, trying a lot to improve but such improvement in the next few years will continue to be marginal.’

sarah.downey@legalease.co.uk

The full list of Queen’s Counsel, by order of seniority:

Simon Paul Steven Cairnes

Jayne Margaret Adams

Kim Franklin

Kennedy Vernon Talbot

Michael Charles Anthony Bedford

Terence Edward Bergin

Peter Anthony Makepeace

Marina Wheeler

James Michael Scott Ramsden

Paul David Ozin

Steven Suppiah Perian

Timothy Charles Penny

Andrew John Moran

Henry James Witcomb

Jonathan Charles Ashley-Norman

Derek Anthony O’Sullivan

Ian James Clarke

Ian Francis Henderson

Sarah Joanne Lee

Cathryn Margaret McGahey

Michael Joseph Ivers

Kerry Louise Bretherton

Michael Andrew Horne

Andrew David Norton

Cyrus Rais Larizadeh

Aidan Patrick Casey

Douglas James Campbell

Richard Julian Henshaw Edwards

Nicholas John Grundy

Mark Eliot George Harper

Emma Rebecca Deacon

Adam John Weitzman

Katharine Susannah Gollop

Adam Sebastian Feest

Justine Thornton

Caroline Mary Shea

Siobhan Grey

Richard William Scott Ground

John Foster Harrison

Alan Grant Johns

Louise June Sweet

Gemma White

Nicholas James Johnson

Catrin Miranda Evans

Simon James Fox

Daniel Nicholas Tatton-Brown

Richard Duncan Atkinson

Philip Evans

Simon Charles Kilvington

William Laurence Latimer-Sayer

Daniel Lightman

William Owain Thomas

Aidan Vine

Thomas Charles Weekes

Jeremy Rupert Daniel Hyam

Oliver Edwin James Glasgow

Alexander Frederick Hickey

James Herbert Maxwell-Scott

Thomas Moody-Stuart

Tobias Augustine William Riley-Smith

Ben Matthew Valentin

Stephen Richard Jagusch

Giles Francis Sacheveral Cockings

Clodagh Maria Bradley

Richard Colin Wilson

Benjamin Roger Collins

James Ewins

James Abrahams

Bridget Maura Dolan

Thomas Richard Hinchliffe

Simon Spiro Malynicz

Kama Louise Melly

Peter Skelton

Clare Adele Sibson

David Ian Head

Stephen Moses

Harry David Glyn Steinberg

Julian Hector Marriott Kenny

Sudhanshu Swaroop

Richard Thomas Kimblin

Hannah Markham

Adam Charles Prest

Daniel Bayfield

Salim Abdool Hamid Moollan

Anya, Lucie, Victoria Proops

Rosalind Jayne Phelps

Daniel Benjamin Squires

David Niaz Mohyuddin

Jonathan Michael Cohen

Brian Anthony Kennelly

Paul Stuart Mitchell

John Dempster McKendrick

Guy Luke Vassall-Adams

Maya Elizabeth Jane Lester

David Stewart Mumford

Alexander Henry Spencer Booth

Lisa Virginia Busch

Riaz Hussain

Gerald Carlo Facenna

Shaheed Fatima

Laurent Charles Sykes

Jonathan Michael Davey

Jonathan Adam Hilliard

Andrew Smith

Nigel Kenneth Rawding

Thomas Plewman

Penelope Jane Madden


Legal Business

Skadden and Freshfields top global deal tables as M&A figures reach record heights

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Corporate Freshfields Bruckhaus DeringerSkadden, Arps, Slate, Meagher & Flom
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In a record year for global M&A, US firm Skadden, Arps, Slate, Meagher & Flom and Magic Circle firm Freshfields Bruckhaus Deringer were the top performers in the US and Europe respectively, according to Dealogic’s 2015 league tables.

As worldwide deal volumes surpassed $5trn for the first time, global attorney rankings for corporate advisory work show Skadden was top of the class, advising on 293 deals worth over $1trn, beating out rivals including Wachtell, Lipton, Rosen & Katz which came second with 130 deals valued at $733.1bn, Latham & Watkins which came third with 302 deals totaling $590.2bn, followed Freshfields with 190 deals worth $587.6bn.

Skadden also came out on top in US attorney rankings, advising on 203 deals valued at $881.9bn. Notably Weil Gotshal & Manges has fallen several places. While the firm had taken the top spot in the global attorney rankings and US attorney rankings in 2014, it now sits in sixth and fourth place respectively for these categories.

Meanwhile, Freshfields retained its title as top firm in the European attorney rankings, advising on $418.4bn worth of deals, while other Magic Circle firms Linklaters, Clifford Chance and Slaughter and May came third ($228.8bn), fourth ($221bn) and sixth place ($200.3bn) respectively. New entrants in Europe’s top ten lawyer rankings included Cleary Gottlieb Steen & Hamilton in seventh place (2014: 12th) and Hogan Lovells in ninth (2014: 15th).

De Brauw Blackstone Westbroek leapt to eighth place from 38th in 2014. Major deals for the Dutch firm last year included Shell’s £47bn acquisition of BG Group alongside Slaughter and May and Freshfields, as well as the $1bn IPO of Grand Vision, the owner of Vision Express, alongside Linklaters and Davis Polk & Wardwell.

EMEA targeted deal flow accounted for 22% ($1.13trn) of global M&A, a record low and well below the average for the last ten years which stood at 35%. One of Europe’s biggest deals was in the food and beverage industry, with Anheuser-Busch InBev’s £71bn proposed takeover bid for SABMiller, an agreement which a host of firms including Freshfields and Linklaters advised on.

US targeted M&A volume reached a record high of $2.47trn, up 59% on the year before, from $1.55trn . Healthcare was the top ranked sector in 2015 with $724.4bn, up 66% from 2014 ($436.4bn) and technology came closely behind with record high volume and activity of $715.7bn via 9,367 deals, over double the 2014 total ($327.4bn).

sarah.downey@legalease.co.uk

Legal Business

Checking in: Freshfields and Stephenson Harwood advise on £1.3bn sale of the Priory

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Dealwatch Freshfields Bruckhaus DeringerStephenson Harwood
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Freshfields Bruckhaus Deringer and Stephenson Harwood have led on the sale of the Priory, the rehab clinic known for its celebrity clients, having treated the likes of supermodel Kate Moss, pop star Robbie Williams and rocker Pete Doherty.

US private equity group Advent International sold the Priory to Acadia Healthcare for £1.3bn, after buying it in 2011 for £925m. Priory’s management was advised on the 2011 transaction by DLA Piper. 

The Priory, which has a hospital in Roehampton, London, operates more than 300 facilities with approximately 7,200 beds. The group is expected to produce around $865m in revenue in 2015 with profit of approximately $196m.

Freshfields advised Advent International, with rising private equity star Adrian Maguire leading on the deal alongside corporate partner Julian Pritchard.

The Magic Circle firm has previously advised Advent International on its 2012 acquisition of Cytec Industries Inc for $1.15bn, and its sale of Domestic & General to CVC back in 2013. 

Stephenson Harwood’s head of corporate Andrew Edge led for Acadia, with support from corporate partner Andrew McLean, corporate finance partner Karima Hudson, real estate partner Simon Brading and employment partner Anne Pritam. Nashville-headquartered law firm Waller Lansden Dortch & Davis acted for Acadia in relation to its financing of the transaction.

Acadia will pay cash consideration of approximately £1.3bn, including approximately £925m used to repay Priory’s outstanding debt.

Brent Turner, Acadia’s president, told Legal Business: ‘We’ve been in the UK for a year and a half and the Priory acquisition gives us expanded scale and service lines across the mental health spectrum in the UK. We’re very excited to help the Priory continue to grow. Given the continuing increase in demand for behavioural services, the market is expanding.’

tom.moore@legalease.co.uk

Legal Business

Dealwatch: Freshfields acts for Deutsche Bank as it sells ¥25.7bn of Chinese assets

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After winning a place on Deutsche Bank’s global legal panel last year, Freshfields Bruckhaus Deringer is representing the German bank on the sale of ¥25.7bn of its Chinese assets.

The firm has advised the German banking giant on the sale of its stake in Chinese financial institution Hua Xia Bank, which is set to raise nearly $4bn.

Under the terms of the transaction, Deutsche Bank will sell its entire 19.99% stake in Hua Xia to Chinese insurer PICC Property and Casualty Company for between ¥23bn and ¥25.7bn ($3.54bn and $3.96bn), subject to final price adjustment at closing. PICC Property and Casualty Company was advised by Linklaters with a team led by Beijing Corporate partner Pui Hong Chik. 

Freshfields’ team was led by corporate partners Melissa Thomas and Alan Wang based in Shanghai, and Heiner Braun in Frankfurt.

In 2010, Freshfields advised Deutsche Bank on the increase of its stake in Hua Xia, from 17.12% to 19.99%, the maximum single foreign ownership level permitted by regulators at the time. The German bank had a stake in Hua Xia since 2006. 

Freshfields was among several firms awarded positions as Deutsche Bank’s go-to advisers after the bank finalised its global legal panel in July last year. Allen & Overy, Hogan Lovells, White & Case, Cleary Gottlieb Steen & Hamilton and Latham & Watkins were also named on the panel which divides the firms regionally between Europe, the Middle East and Africa; the US; and Asia.

In April last year Deutsche Bank was fined £1.7bn for Libor rigging and suffered a fall in profits after setting aside litigation expenses of €1.5bn in the first quarter of that year. Its litigation reserves were €4.8bn at the end of the fourth quarter of 2014.

jaishree.kalia@legalease.co.uk

 

Legal Business

Property panel: Freshfields, Herbert Smith and Addleshaws make British Land roster

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Adviser reviews Addleshaw GoddardFreshfields Bruckhaus DeringerHerbert Smith Freehills
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Magic circle heavyweight Freshfields Bruckhaus Deringer has joined Addleshaw Goddard, Herbert Smith Freehills, Jones Day, King & Wood Mallesons, Mayer Brown and Simmons & Simmons on British Land’s first panel.

The property investment firm, which appointed former Freshfields partner Elaine Williams as its first general counsel in September, said it would also continue to work with other firms such as Sheppherd & Wedderburn and Carey Olsen in specialist areas.

While the panel review began before Williams joined as the FTSE 100 firm’s first general counsel in November, Williams was involved in the later stages and final decision making.

Williams said: ‘We were extremely impressed with the quality of the proposals submitted and in particular the thoughtful suggestions for effective collaboration and efficient provision of legal services. We are looking forward to developing closer collaborative ways of working with our panel firms”

King & Wood Mallesons legacy firm SJ Berwin has been a long-time adviser to British Land, with partner Matthew Priday advising on its complex acquisition of Aviva’s Paddington Central estate for £470m in ten weeks in 2013. Priday also acted on all aspects of the company’s West End portfolios including the flagship Regent’s Place scheme.

Other panel reviews to wrap up before Christmas include Edinburgh City Council, Tata Chemicals and Coca-Cola.

victoria.young@legalease.co.uk

Legal Business

Closing Cologne: Freshfields restructures German offices to create broad offering

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Europe Freshfields Bruckhaus Deringer
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In a bid strengthen its platform in Germany, Freshfields Bruckhaus Deringer is closing its Cologne office, with the bulk of its staff transferring to the firm’s existing Düsseldorf outpost.

Some 18 partners and 50-60 associates currently based in Cologne will move to Düsseldorf to ‘create a larger and broader’ offering of more than 40 partners. Also joining that office is corporate partner Andreas Fabritius and worldwide corporate practice group head Rick van Aerssen who move from Freshfields’ Frankfurt office.

Cologne’s private equity team – corporate partners Ludwig Leyendecker and Kai Hasselbach and six associates – will be transferring to the firm’s existing Munich office in a bid to ‘build out Munich as one of the hubs of private equity’.

The new office will be called the Rhineland office and will be managed by IP litigation partner Matthias Koch, who was based in Cologne. The office will focus on transactional, investigation, regulatory and litigation capabilities.

The Rhineland office will also be the main hub for global investigations in Germany, and corporate partner Franz Aleth will lead global integrations and separations with an aim to work more closely with Freshfields’ US practice.

The transition will begin next year, with the firm planning to find a new location in Düsseldorf by 2018, allowing two-years for the initial transition phase. Cologne based associates and business services staff were informed of the transition yesterday (16 December).

In November Freshfields confirmed it was restructuring to create what it said would be the ‘perfect platform’ for a stronger presence in the Rhineland.

Freshfields incoming co-managing partner Stephan Eilers said: ‘This is much more than an office merger. We further strengthen our stellar teams in Germany’s financial and industrial centres. They will work as part of our wider German practice, giving clients what they demand – capabilities in the major economic regions of Germany and a seamless cross-German offering that will harness the skills of all our lawyers in the country regardless of where they are based.’

Eilers said the firm’s restructuring was not a performance driven initiative and that it has no plans to close or restructure any other offices in Germany and Austria. The firm has around 125 partners in both countries.

jaishree.kalia@legalease.co.uk

For more on management changes and the challenges ahead for Freshfields Bruckhaus Deringer, see The last champions – meet the leaders intent on sealing Freshfields’ place in the global elite (£)

Legal Business

Taking Manhattan: Freshfields hires Skadden Arps specialist in US leveraged finance boost

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Strategic recruitment Freshfields Bruckhaus Deringer
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Freshfields Bruckhaus Deringer has continued its recent push in the US with the hire of experienced Skadden, Arps, Slate, Meagher & Flom counsel David Almroth as a partner to boost its US finance practice.

Almroth is the second finance specialist to join Freshfields from Skadden Arps after former leveraged finance partner James Douglas joined having served the US firm for 25 years up until 2010.

Almroth joined Freshfields’ leveraged finance practice today (7 December) to complement its development of a transactional practice in the US. Since joining Skadden Arps in 1995, Almroth has advised on secured and unsecured financings, asset-based loans, bridge loans, first lien/second lien financings, corporate recapitalisations, and acquisition financings.

Some of his corporate clients have included Hayes Lemmerz International; Builders FirstSource; Duff & Phelps; and Fortress Investment Group; while his private equity clients have included JLL Partners; Access Industries; Marathon Asset Management, Oaktree Capital Management, MTS Health Partners, Veritas Capital and Doughty Hanson.

Douglas, who heads the firm’s US leveraged finance practice, said: ‘Dave is a first class lawyer and we all look forward to working with him. Adding Dave to our team clearly enhances our finance offering to complement our rapidly expanding transactional practice in the US. I have known Dave for many years and both personally and professionally he is a perfect fit for what we are building here in New York.’

Freshfields’ recruitment drive comes as the firm invested in a series of high-profile hires in the last 18 months to establish the firm’s first proper US footprint. In June, Freshfields took on Simpson Thacher & Bartlett’s experienced corporate disputes specialist Linda Martin, which boosted the Magic Circle’s dispute capability in Manhattan.

This came after the firm saw the high-profile arrival of Fried, Frank, Harris, Shriver & Jacobson corporate trio Valerie Ford Jacob, Michael Lewitt and Paul Tropp; and Shearman & Sterling’s M&A veteran Peter Lyons arrival.

The strategic recruitment in US law began after the firm made provisions to allow it to pay a small band of recruits over the top of its lockstep.

jaishree.kalia@legalease.co.uk

For more on Freshfields US play, see The last champions – meet the leaders intent on sealing Freshfields’ place in the global elite (£)