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

Legal Business

Skadden, White & Case, Freshfields, Simpson lead elite firms on Europe’s largest software buyout

Skadden, White & Case, Freshfields, Simpson lead elite firms on Europe’s largest software buyout

Skadden, Arps, Slate, Meagher & Flom and White & Case advised HgCapital as it led a consortium of investors purchasing €4.64bn of stakes in Norwegian software company Visma, in one of Europe’s largest ever software buyouts.

US buyout firm KKR is selling its entire €1.59bn stake in Visma, while private equity firm Cinven is selling 40% of its Visma holdings.

Private equity partners Richard Youle and Katja Butler, left White & Case last month to join Skadden in anticipation of the deal’s announcement. 

White & Case remain advisers to Hg on the debt component of the deal, with a team led by London’s banking partner Colin Harley and Brussels’s antitrust partner Pontus Lindfelt.

The investor group includes Intermedia Capital Group (IGC), Montague, the Government of Singapore Investment Corporation (GIC) and Visma’s management team.

KKR is advised by Simpson Thacher & Bartlett, alongside ABG Sundal Collier, Morgan Stanley, EY and OC&C, while Freshfields Bruckhaus Deringer, in a team led by Adrian Maguire and Victoria Sigeti, advised Cinven.

Ropes & Gray advised new client ICG, led by private equity partner Helen Croke and finance partner Malcolm Hitching, who led on the debt aspects of the deal. 

Linklaters advised Montagu with a team led by financial sponsors co-head Alex Woodward.

Oslo-headquartered Visma provides mission critical accounting, resource planning and payroll software to small and medium-sized businesses in the Nordic and Benelux region.

Before the deal, Hg, Cinven and KKR each owned a third of Visma. Following the deal, Hg will hold 41% of Visma, Cinven will retain a 17% share, while Visma management will hold 7%. The rest of the consortium will hold minority stakes.

Hg initially invested €114.8 million in Visma in 2006, completing a public-to-private de-listing from the Oslo stock exchange valuing the business at £382m at that time. HgCapital subsequently continued to hold a stake in the business over the following eight years, before re-investing again in 2014, alongside both KKR and Cinven, each holding 31.3% of the company at that point.

Between 2006 and 2016, Visma’s revenues grew at a compound annual rate of 17. The company completed more than 120 bolt-on acquisitions over the same period and improved operating margins from 15% to 25%.

Schjødt is advising HgCapital on Norwegian aspects of the deal and Wiersholm for Visma and the management team.

Private equity firms have been increasingly interested in software companies in recent years.

Marco.cillario@legalbusiness.co.uk

Legal Business

Dealwatch

Dealwatch

SKADDEN PULLS MOODY’S IN €3BN DEAL

Allen & Overy (A&O) and Skadden, Arps, Slate, Meagher & Flom led as Moody’s agreed a €3bn (£2.6bn) deal to buy Dutch data group Bureau van Dijk from Swedish private equity company EQT. Skadden advised Moody’s, alongside Dutch adviser Stibbe, while A&O acted for EQT. Latham & Watkins advised the banks, while Baker McKenzie acted for van Dijk’s managers. Simmons & Simmons is also playing a role, providing employment and pensions advice to Moody’s.

Legal Business

Freshfields and Skadden win roles on LSE’s $685m buyout of Citi yield book

Freshfields and Skadden win roles on LSE’s $685m buyout of Citi yield book

Freshfields Bruckhaus Deringer and Skadden, Arps, Slate Meagher & Flom have won places advising on the London Stock Exchange (LSE)’s $685m buy-out of Citi’s yield book and fixed-income indices.

The purchase, which includes the World Government Bond Index, is anticipated to close in the second half of 2017 subject to regulatory clearance.

The yield book’s analytics platform serves 350 institutions globally including investment management firms, banks, central banks, insurance companies, pension funds, broker-dealers, hedge funds and investment management firms.

Freshfields advises LSE on the transactions, with US regional managing partner Peter Lyons and London based IP partner Giles Pratt leading on the deal.

Skadden’s New York based partners Jeffrey Brill, Stuart Finkelstein, Erica Schohn and Kenneth Schwartz advised Citi.

Freshfields previously advised LSE on its failed merger with Deutsche Börse. The Magic Circle firm advised alongside Linklaters on the deal – which was the third attempt at a tie-up.

Former Freshfields M&A veteran Mark Rawlinson advised alongside partners Andrew Hutchings and London M&A co-head Piers Prichard Jones, LSE while Linklaters corporate partner Roger Barron acted for Deutsche Börse, along with Simon Branigan in London and Ralph Wollburg and Staffan Illert in Germany.

Last week Skadden announced it had picked up global and EMEA PE co-head Richard Youle, along with recently promoted PE partner Katja Butler.

madeleine.farman@legalease.co.uk

 

Legal Business

‘Move makes sense’: Skadden breaks up White & Case City PE duo with Youle hire

‘Move makes sense’: Skadden breaks up White & Case City PE duo with Youle hire

In what amounts to a break-up of one of the City’s most storied private equity partner duos, Skadden, Arps, Slate Meagher & Flom has hired White & Case’s global and EMEA PE co-head Richard Youle, along with recently promoted PE partner Katja Butler.

The move splits the long-running and successful pairing of Youle and Ian Bagshaw, who had known each other since Youle was Bagshaw’s trainee at Eversheds in the 1990s. Youle (pictured) joined White & Case with Bagshaw in 2013 after resigning from Linklaters after seven years with the Magic Circle firm.

They were then both named co-heads of PE at White & Case in 2015 and have been central to a strong run of form for the City office of the US firm. Two years after their arrival, the private equity group in London was already pulling in close to the £40m that the Linklaters team had been generating under their leadership.

A spokesperson for White & Case said: ‘We can confirm that Richard Youle and Katja Butler are leaving White & Case to join Skadden. We wish them every success in their future endeavours. Our private equity team and leadership is deep and broad on a global basis and will continue to be run by Ian Bagshaw based in London and Oliver Brahmst based in New York.’

Bagshaw told Legal Business: ‘Richard is a great partner, I’ve had the pleasure of working with him for ten years. This move makes sense for him. We have had a great run since joining up in 2013 and will continue building out White & Case’s private equity practice in London going forward with the wider team.’

Youle advises PE houses and financial sponsor clients on all forms of leveraged M&A and portfolio assistance including restructuring advice, with clients such as HgCapital, Montagu, Oaktree and Mid Europa Partners.

Butler was made up to partner at White & Case in January and her focus is on PE deals as well as providing assistance to sponsor-held portfolio companies between buyout and exit.

White & Case’s London office saw a 4% increase in turnover to $290m as the firm posted a 7% increase in global revenue for 2016 reaching $1.63bn, up on last year’s 1% increase in revenue of $1.52bn.

In 2016, Kikland & Ellis hired David Holdsworth, one of Linklaters’ last remaining private equity heavyweights in the City, as the US firm rebuilt its London office. This followed a six-partner team announced in February 2016 to depart Kirkland to set up a City PE team at Sidley Austin.

Earlier this year, a group of five Paris corporate partners – collectively responsible for a book of business worth £8m – moved from Ashurst to Freshfields Bruckhaus Deringer.

georgiana.tudor@legalease.co.uk

For more on the City private equity shark tank, see ‘ABC – the brutally simple world of a private equity lawyer’