Legal Business

Bad timing – A&O loses M&A duo to Skadden following failed US merger talks

Bad timing – A&O loses M&A duo to Skadden following failed US merger talks

Allen & Overy has lost two well-respected London corporate partners to Skadden, Arps, Slate, Meagher & Flom just days after the magic circle firm confirmed the collapse of its merger talks with US firm O’Melveny & Myers.

Simon Toms and George Knighton have quit A&O, inflicting a considerable hit on its M&A capabilities ten days after it announced it was calling it a day on its attempts to tie up with O’Melveny after more than a year of talks.

Toms counts among his clients 21st Century Fox, which he advised in its bid to acquire European satellite broadcaster Sky, HP and Cerberus Capital Management, while Knighton recently acted on the £1.7bn sale of Virgin Money to CYBG.

The departures to a US outfit carry a particularly high symbolic value at a time when A&O’s leadership has promised to fast-track investment in its US practice as the pressure to strengthen its capabilities Stateside persist.

Meanwhile, this is the biggest coup for Skadden’s European corporate practice since the hire of former Linklaters private equity partner Richard Youle from White & Case in 2017.

A&O and Skadden declined to comment.

marco.cillario@legalease.co.uk

Legal Business

Deal watch: Seats at the table for Travers, Skadden and Gateley as Pret acquires EAT and Oliver’s chain collapses

Deal watch: Seats at the table for Travers, Skadden and Gateley as Pret acquires EAT and Oliver’s chain collapses

Two opposite developments in the UK high street have seen City and US firms advise as food chain Pret A Manger acquired rival Eat and high-profile British chef Jamie Oliver’s restaurant business went into administration.

Also keeping City insolvency practitioners busy was the news today (22 May) that British Steel has been put into compulsory liquidation.

Skadden, Arps, Slate, Meagher & Flom advised Pret as it agreed to acquire all of Eat’s 94 shops for an undisclosed sum, with plans to turn most into ‘Veggie Prets’.

The US firm’s team was led by London corporate partners Richard Youle, Katja Butler and Linda Davies. Freshfields Bruckhaus Deringer partner Alex Potter is advising Pret on antitrust.

On the other side of the table, Travers Smith’s head of private equity and financial sponsors Paul Dolman led the team advising Ardian, Horizon Capital and the other selling shareholders of Eat.

‘I acted for Horizon when they acquired Eat [in 2011] and we have acted for them ever since, so we were the logical people to advise on the sale,’ Dolman told Legal Business. ‘Travers has in-depth expertise in this sector.’

The deal sees Travers’ and Pret’s paths cross again after the City firm advised previous owner Bridgepoint on the £1.5bn sale of the food chain to JAB Holding Company one year ago, with a team including Dolman and private equity partner Ian Shawyer.

Under Bridgepoint’s ownership the company, founded in London in 1986, expanded its presence in the UK and US, and launched in France, China, Dubai and Singapore, quadrupling its revenues to £879m. It now counts over 500 shops in nine countries.

Eat was founded in 1996 and bought by Horizon in 2011 with plans to build hundreds of shops. But it has struggled in recent years and reported pre-tax losses of £17.2m in the year to end of June 2018.

Meanwhile, Daniel French, an insolvency partner at listed firm Gateley, is leading the team acting alongside administrator KPMG after Oliver’s business became the latest victim amid difficult times for the UK high street.

Jamie Oliver Restaurant Group will see 22 of the 25 eateries it operates close, resulting in 1,000 job losses.

This is the second prominent high-street insolvency Gateley has acted on this year. The firm also advised KPMG on the administration of Patisserie Valerie in January.

Elsewhere, Clifford Chance (CC)’s insolvency team is advising as British Steele entered compulsory liquidation, putting its 5,000 employees at risk of redundancy.

The government’s official receiver has taken control of the company and together with Big Four accountancy firm EY is looking for a buyer, while it continues to trade normally.

CC’s restructuring head Philip Hertz and partner Iain White are leading the team advising on the process.

The Magic Circle firm was previously among the advisers in one of the largest UK insolvencies to hit the construction industry in recent years, when construction giant Carillion collapsed in January last year.

marco.cillario@legalease.co.uk

Legal Business

A&O ups the ante on female partner promotions as Skadden ends City investment drought

A&O ups the ante on female partner promotions as Skadden ends City investment drought

Allen & Overy has promoted 14 London partners amid a scaled up 34-strong global round while Skadden, Arps, Slate, Meagher & Flom has promoted its first City partner in three years.

The Magic Circle firm made heavier investment in new partners than last year and also significantly improved the promotion of women, minting eight females – equal to 24% of the newest partners – of which two are part-time. Last year, A&O made up only two women in its 20-strong round, having the same month vowed to redouble its diversity efforts.

Notably, Shruti Ajitsaria, the head of its tech innovation space Fuse, was promoted to partner.

Ajitsaria said: ‘After training at A&O, I think it’s fair to say I have taken a slightly alternative career path. The success of Fuse is testament to the spirit of innovation which runs throughout the firm – from management to our trainees and across our global offices.’

Jonathan Brayne, chairman of Fuse, added: ‘Shruti has been fundamental to the highly successful launch and operation of Fuse, A&O’s tech innovation space.  I’m confident she will take it to another level as a partner and will find new ways of keeping Fuse – and with it Allen & Overy – in the vanguard of legal market tech innovation.’

The firm has a target of having 30% female partner candidates by 2021 with a view to having 30% women in its partnership overall. The other London promotions saw five made up in banking, four in corporate, two in international capital markets (ICM) and two in litigation.

Skadden, meanwhile, has promoted Denis Klimentchenko from counsel to partner for its City M&A bench, a rare investment for the firm having bypassed London altogether for two-years running.

While a show of support for the London office, the 11-strong global round is scaled back from previous years when 14 were made up in 2018 and 12 were promoted in 2017. Klimentchenko is the first promotion in London since Sandro de Bernardini was minted to Skadden’s City M&A team back in 2016.

 

The full list of A&O partner promotions:

Arnold Keizer, litigation, Amsterdam

Hilde Van der Baan, litigation, Amsterdam

Sarah Wilson, banking, Bangkok

Thales Mertens, litigation, Brussels

Kyle Nevin, banking, Dubai

Anthony Traboulsi, banking, Dubai

Zeid Qursha, corporate, Dubai

Tina LeDinh, corporate, Ho Chi Minh City

Oleg Khomenko, banking, London

Catherine Lang-Anderson, banking, London

Nick Lister, banking, London

Ed Moser, banking, London

Jodi Norman, banking, London

Michael Bloch, corporate, London

Kate McInerney, corporate, London

Hugh Robinson, corporate, London

William Samengo-Turner, corporate, London

Shruti Ajitsaria, Fuse, London

Peter Crossan, ICM, London

Suril Patel, ICM, London

Brandon O’Neil, litigation, London

Robbie Sinclair, litigation, London

Yannick Arbaut, banking, Luxembourg

Jacques Graas, corporate, Luxembourg

Paul Peporte, ICM, Luxembourg

Santiago de Vicente, real estate, Madrid

Paolo Nastasi, corporate, Milan

Bulat Zhambalnimbuev, corporate, Moscow

Magnus Mueller, tax, Munich

Xavier Jancène, real estate, Paris

Aloysius Tan, ICM, Singapore

Tokutaka Ito, corporate, Tokyo

Bartosz Merczynski, litigation, Warsaw

Maura Rezendes, corporate, Washington DC

 

The full list of Skadden partner promotions:

Christopher Barlow, M&A, New York

Julie Cohen, litigation, New York

Elena Coyle, financial institutions, New York

Alec Jarvis, tax, New York

Denis Klimentchenko, M&A, London

Joseph Larkin, litigation/corporate restructuring, Wilmington

Christopher Murphy, tax controversy, Palo Alto

Alisha Nanda, litigation, Boston

Christine Okike, corporate restructuring, New York

Paloma Wang, capital markets, Hong Kong

Geoffrey Wyatt, mass torts, insurance & consumer litigation, Washington DC

 

nathalie.tidman@legalease.co.uk

Legal Business

US firms deployed on $43bn Worldpay takeover as Freshfields scores lead on major bank merger

US firms deployed on $43bn Worldpay takeover as Freshfields scores lead on major bank merger

Skadden, Arps, Slate, Meagher & Flom is advising payment processor Worldpay on a proposed $43bn takeover offer by financial technology company FIS, while Freshfields Bruckhaus Deringer has been drafted in to act for Deutsche Bank on merger talks with rival Commerzbank.

The deal, announced yesterday (18 March), will see Worldpay shareholders receive $11 in cash for each of their shares. The merger gives Worldpay an enterprise value of around $43bn, including its debt, which Florida-based FIS expects to refinance.

In a joint statement, the companies said the combination greatly enhances FIS’ payment offering and ‘significantly increases Worldpay’s distribution footprint’.

The Skadden team advising Worldpay consists of New York partners Peter Atkins, David Ingles, Sven Mickisch, Joseph Penko and London-based partner Scott Hopkins. Willkie Farr & Gallagher was enlisted to advise FIS on the deal, with a team led by US partners Robert Rachofsky and Adam Turteltaub, and in the UK by Jennifer Tait and Henrietta de Salis.

It is the second major merger Worldpay has been subject to in under two years: in September 2017 it was bought by Vantiv, creating a company with a combined value of £22.2bn. Skadden was involved that time too, assisting the Cincinnati-based Vantiv, while Allen & Overy advised Worldpay.

Later this year, Worldpay general counsel (GC) Ruwan de Soyza is set to leave for a GC and executive committee role at a FTSE 100 technology company.

Meanwhile, Freshfields and German firm Hengeler Mueller have landed roles as Deutsche Bank and Commerzbank announced last Sunday (17 March) they were in merger discussions. Nevertheless, the rival banks warned ‘there is no certainty that any transaction will occur.’

In January 2016, Freshfields advised Deutsche Bank as it sold ¥25.7bn of its Chinese assets.

Hengeler Mueller is advising Commerzbank, with a team consisting of partners Johannes Adolff, Hartwin Bungert, Daniela Favoccia, Dirk Bliesener, Lucina Berger and Martin Klein.

tom.baker@legalease.co.uk

Legal Business

Deal watch: Slaughters leads on Wonga collapse and joins Skadden, Ashurst and CC on £3.9bn Costa deal

Deal watch: Slaughters leads on Wonga collapse and joins Skadden, Ashurst and CC on £3.9bn Costa deal

Slaughter and May has landed key roles on the high-profile collapse of payday lender Wonga and Coca-Cola’s £3.9bn acquisition of national coffee house Costa, joined by Skadden, Arps, Slate, Meagher & FlomClifford Chance (CC) and Ashurst.

The demise of Wonga, the UK’s largest payday lender, was confirmed yesterday (30 August) amidst a flood of compensation claims as the government cranks up the pressure on companies offering high-cost, short-term loans.

Wonga’s overseas businesses will continue to trade, while the Financial Conduct Authority (FCA) supervises Wonga in seeking fair treatment of customers. The UK business is not accepting any new loan applications.

Slaughters is advising the company with a team consisting of head of corporate, Andy Ryde, and restructuring and insolvency partners Ian Johnson and Tom Vickers. The Magic Circle firm is also expected to advise the administrators, Grant Thornton.

‘It’s still the very early stages,’ Johnson told Legal Business. ‘I think in this case it’s business-specific issues: they had a number of legacy issues which have led us to where we are now.’

Elsewhere, Slaughters also had a key role in Coca-Cola’s acquisition of the largest coffee company in the UK, Costa. Upon completion, Coca-Cola will acquire nearly 4,000 Costa outlets across the country as it expands its coffee portfolio, which already includes the Georgia brand in Japan among others globally.

Slaughters advised Costa’s owner Whitbread, a long-standing client of the firm. Its team includes corporate partners Martin Hattrell and Simon Nicholls, IP partner Duncan Blaikie, tax partner Mike Lane, real estate partner Jane Edwarde, pensions and employment partners Jonathan Fenn and Phil Linnard, competition partner Anna Lyle-Smythe and finance partner Matthew Tobin.

CC partners Robert Crothers and Gareth Camp advised Coca-Cola on the corporate elements of the deal. Skadden, meanwhile, fielded a team led by London-based tax partner Alex Jupp, with assistance from New York partners David Rievman and Chase Wink, in advising Coca-Cola on the tax aspects of the deal.

Coca-Cola president and chief executive James Quincey commented: ‘Hot beverages is one of the few segments of the total beverage landscape where Coca-Cola does not have a global brand. Costa gives us access to this market with a strong coffee platform.’

thomas.alan@legalbusiness.co.uk

Legal Business

Deal View: Life after Hatchard – does Skadden hunger to take its peerless M&A team to the next level?

Deal View: Life after Hatchard – does Skadden hunger to take its peerless M&A team to the next level?

‘Theirs is the biggest succession issue faced by any firm in the City,’ says one Magic Circle partner of Skadden, Arps, Slate, Meagher & Flom’s prospects, following the retirement of veteran dealmaker Michael Hatchard (pictured right) at the end of last year.

The widely-admired Hatchard did much to make Skadden a US trailblazer in public M&A work in Europe. Though leveraged finance hogs the headlines these days, Hatchard and Skadden were still the competitive forces most cited by top M&A partners at London rivals. Having moved from Theodore Goddard in 1994, Hatchard (who remains a consultant to Skadden) was one of the most successful transfers ever in City law.

‘Michael is urbane, charming and clever, while being no-nonsense,’ gushes one Herbert Smith Freehills partner. ‘The epitome of an English M&A lawyer – he’s exactly the person you’d want on a pitch.’

Dwelling on the man’s deal highlights in any length would require a longer article, but representative standouts include advising Pfizer on a $69bn bid for AstraZeneca, advising Colfax Corporation on its $2.4bn acquisition of Charter International and the 2015 work on Ball Corporation’s acquisition of Rexam for £4.3bn.

Still, many question why a Wall Street institution with such a strong M&A heritage has not built more on that early progress. Yes, Mergermarket’s UK M&A league tables place Skadden at number three by deal value, having advised on $99bn of transactions over 27 deals in 2017, more than twice the ranked value of 2016. But such benchmarks are volatile and invariably inflate the role of American counsel in substantive European deal work.

The UK figures were bolstered, advising Cincinnati-based Vantiv on its £9bn acquisition of UK-listed payment processor Worldpay, with a team featuring London partners Scott Hopkins and Linda Davies.

You can question – and some do – if Skadden has enough depth to its ten-partner City M&A bench, which includes elder statesman Scott Simpson (pictured left), Lorenzo Corte, Sandro de Bernardini, Hilary Foulkes, Pranav Trivedi, Robert Stirling, Richard Youle and Katja Butler.

De Bernardini was the last internal promotion back in 2016, while the rare lateral hires of White & Case dealmaker Youle along with Butler last year brought in an M&A hand with a genuine following and presence.

The debate about how Youle’s buyout business fits into Skadden’s M&A machine has been much rehearsed, but Skadden is bullish given that Youle helped to secure a key role advising Hg Capital, the lead member of the consortium bidding for Norwegian software firm Visma for €4.64bn.

One M&A partner at a rival points to the 2014 hire of Freshfields Bruckhaus Deringer insurance head Robert Stirling as another significant addition. Stirling was instrumental in sealing a role earlier this year advising UK-listed Phoenix Group on its £3.2bn acquisition of Standard Life Aberdeen’s insurance business.

Simpson, co-head of Skadden’s global transactions practice, comments on life after Hatchard: ‘Michael laid the foundations for us to be the only firm to take on the Magic Circle on UK M&A on a regular basis. Over 20 years he also helped to build out our capabilities in banking, tax, litigation, white-collar crime, regulatory work, funds and employment law. Our strategy remains the same: be the firm of choice in Europe for the most challenging deals.’ And with an M&A tradition as rich as Skadden’s no-one doubts the firm will remain a potent force in the transatlantic deals community.

Yet the glory days of Skadden’s iconoclastic dash under Joseph Flom – when it was the most influential law firm in the corporate legal market – have surely long since passed. And the firm has been wary of expansion since being forced to shed hundreds post-Lehman. Skadden will have to be do more in Europe’s M&A market to be not only respected but once again feared.

nathalie.tidman@legalease.co.uk

See our Life During Law with Skadden’s Richard Youle

Legal Business

Deal view: Life after Hatchard – does Skadden hunger to take its peerless M&A team to the next level?

Deal view: Life after Hatchard – does Skadden hunger to take its peerless M&A team to the next level?

‘Theirs is the biggest succession issue faced by any firm in the City,’ says one Magic Circle partner of Skadden, Arps, Slate, Meagher & Flom’s prospects, following the retirement of veteran dealmaker Michael Hatchard (pictured right) at the end of last year.

The widely-admired Hatchard did much to make Skadden a US trailblazer in public M&A work in Europe. Though leveraged finance hogs the headlines these days, Hatchard and Skadden were still the competitive forces most cited by top M&A partners at London rivals. Having moved from Theodore Goddard in 1994, Hatchard (who remains a consultant to Skadden) was one of the most successful transfers ever in City law.

Legal Business

Skadden zeros out of London for second year running in global partner promotion round

Skadden zeros out of London for second year running in global partner promotion round

While other US rivals beef up their London partner headcount, Skadden, Arps, Slate, Meagher & Flom has for the second consecutive year passed over its City office for promotions, making up 14 new partners in a heavily US-focused round.

The move sees an uptick of partner promotions generally for the New York giant from last year’s round of 12 lawyers but continues its omission of the City branch. Four of the promotions – effective 1 April – were made outside of the US: one each in Frankfurt, Hong Kong, Paris and Tokyo.

Sandro de Bernardini was the last internal promotion in the firm’s London M&A team back in 2016, while the rare lateral hires of White & Case dealmaker Richard Youle along with Katja Butler last year have been much-talked about. Going the other way, US rival Cooley earlier this year snapped up Skadden’s veteran M&A partner Michal Berkner after more than 20 years at the firm. Overall lawyer headcount in the London office fell over 2017, according to our latest Global London report.

Notwithstanding a lack of growth in the City, Skadden has handled some impressive deals in recent months. Playing to its strengths with US corporates, its UK figures were bolstered in 2017 by a prestigious mandate to advise Cincinatti-based Vantiv on its £9bn acquisition of London Stock Exchange-listed payment processor Worldpay.

With Youle at the helm, the firm also last year advised HgCapital as lead consortium member  in its €4.64bn bid for Norwegian software company Visma, one of Europe’s largest ever software buyouts.

Nathalie.tidman@legalbusiness.co.uk

For more on his recent move to Skadden, read Life During Law: Richard Youle 

Legal Business

Life during law: Richard Youle, Skadden, Arps, Slate, Meagher & Flom

Life during law: Richard Youle, Skadden, Arps, Slate, Meagher & Flom

When I moved to Hull from Sheffield at five my next-door neighbour was a just-born, [Linklaters partner] Alex Woodward – Woodie. A very good friend. Our mums and dads are very good friends. Went to the same schools, drank in the same pubs.

Woodie is super-smart, so he got a training contract at Linklaters, whereas I trained at Stamp Jackson & Procter in Hull.

Legal Business

Skadden and A&O act on Vantiv’s £9bn buyout of UK payment processor Worldpay

Skadden and A&O act on Vantiv’s £9bn buyout of UK payment processor Worldpay

An Allen & Overy (A&O) team is advising UK company Worldpay on its £9bn sale to US payment processor Vantiv, the largest US merchant acquirer by transaction volume, in its bid to cover the global market.

The A&O team is led by corporate partner Duncan Bellamy, who also led A&O on London Stock Exchange (LSE) listed Worldpay’s 2015 initial public offering (IPO), and is joined by M&A partner Seth Jones.

Skadden, Arps, Slate, Meagher & Flom represented Cincinnati-based Vantiv on the deal. In 2016, the company processed 25 billion transactions with a combined $930bn value.

In a joint statement, Worldpay and Vantiv said they saw a ‘compelling strategic, commercial and financial rationale’ for the combination, which will create a global company with a ‘strong position’ in the four core regions: the US, Europe, Asia-Pacific and South America.

Worldpay was subject to an offer from US banking giant JPMorgan Chase yesterday, but the company announced today that an agreement had been reached with Vantiv.

The deal values Worldpay’s shares at £3.85 each, with shareholders entitled to 55p per share. A Worldpay spokesperson confirmed that the value of the merger was subject to share price change, but that the ultimate value will be around £9bn.

Vantiv chief operating officer Charles Drucker will lead the group as executive chairman and co-chief executive while Vantiv’s Stephanie Ferris will assume the role of chief financial officer.

Worldpay chief executive Philip Jansen will continue as a chief executive for the combined company.

Following the merger’s completion, Worldpay shares will be delisted from the LSE. Common stock in Vantiv, which will be the ultimate holding company of the combined group, will continue to be listed on The New York Stock Exchange.

A&O, Weil, Gotshal & Manges and Freshfields Bruckhaus Deringer advised Worldpay on its 2015 IPO. The float was the largest of the year. It gave Worldpay a market value of more than £5bn.

At the time, Bellamy, David Broadley and US securities partner Jeff Hendrickson advised Worldpay. Weil’s team advising Advent International and Bain Capital was led by London partner Marco Compagnoni, with Peter King, Samantha McGonigle and Simon Lyell. Freshfields advised underwriter Goldman Sachs, led by capital markets partner Mark Austin.

tom.baker@legalease.co.uk