Allen & Overy (A&O) and Linklaters have secured the main roles on the biggest M&A deal of the year. A&O is acting as lead adviser to German utilities conglomerate RWE on its e8.5bn (£5.22bn) bid for Innogy, while Linklaters is advising the target. RWE last week put in a bid of e5bn (£3bn) for the Innogy shareholders, plus an offer to take on e3.4bn (£2.1bn) of Innogy's assumed debt. If the deal goes ahead, RWE will become the UK's fourth-largest energy retailer. RWE already owns Thames Water and hopes to cross-sell between Thames and Innogy customers. With cross-utility ownership and a substantial foothold in the UK's deregulation energy market, Innogy is an attractive target. It has received at least one other rival bid, believed to have come from Scottish Power. For legal advice, Innogy turned to longstanding corporate adviser Linklaters. Charlie Jacobs is Linklaters' main Innogy relationship partner, having advised the company on its demerger from National Power in 1999. Since the demerger, Innogy has made a number of acquisitions, and all of the big deals, including the Northern Electric asset swap and the Yorkshire Water acquisition, have gone to Linklaters. Jacobs said: "In a quiet M&A market, it's great to see a deal this size. This is a sign that there might be more activity out there." A large Linklaters team is advising Innogy on all aspects of the takeover. Corporate partners Olivia McKendrick, David Avery-Gee and Nick Taylor are working alongside Jacobs, competition advice is being covered by Bill Allan, Oliver Black and Nigel Seay, banking by Robert Elliot, tax by Mike Hardwick and employment and share schemes by Raymond Jeffers and Gillian Chapman. The small US law component is being covered by Bill Hobbs and Tom Shopshire. Linklaters worked closely with the Innogy in-house legal team, led by company secretary and managing director of corporate services Mike Bowden. Much of the work on the deal was done by the in-house team. "Our small team did all the negotiation and a group led by Alan Robinson did all the due diligence," said Bowden. "We try to do as much as possible ourselves." RWE is using longstanding corporate adviser Hengeler Mueller in Germany, but needed lawyers who could handle the UK aspects. Linklaters acted for RWE on the Thames Water acquisition, but was immediately conflicted because it was advising Innogy. The UK utilities market has been dynamic over the past few years and other firms, including Freshfields, would have had similar conflict problems. Fortunately for RWE, the company had an existing relationship with A&O. Cravath Swaine & Moore and Shearman & Sterling are advising on US law respectively. The A&O team is being led by Alan Paul, who is working with corporate partners Jeremy Thomas and Mark Dighero. Mark Friend is advising on the competition aspects of the deal, which requires an EU filing.