6 August 2001
26 February 2001
17 December 2001
8 May 2006
26 February 2001
1 December 2002
Big deals Ashanti Goldfields sells subsidiary to AngloGold
Value $340m (£238.57m)
An unprecedented limited recourse finance deal produced the largest mining transaction in the region and made one of the biggest goldmines in Africa.
In July 2000, troubled African-based Ashanti Goldfields Company sold half of its subsidiary Geita Gold Mine to South African company AngloGold, to support its finances.
On 27 September 2000, the parties agreed a term sheet with Barclays Capital, Dresdner Kleinwort Wasserstein and NM Rothschild & Sons to arrange a finance facility for the takeover.
Under a sale and purchase agreement, AngloGold paid $205m (£143.84m) and was permitted to arrange $135m (£94.73m) of finance for Geita Gold Mine.
Norton Rose acted for Ashanti Goldfields, led by banking partner Richard Calnan, with head of project management Jeffery Barratt and assistants Tom Day and Nazima Chowdhary. The corporate team was led by Mark Banks, with Raj Karia and Gill Gauntlet. Tanzanian taxation regulations were one of the hurdles the Norton Rose team had to overcome.
The lenders wanted to enter into gold hedging contracts, which can place a lien on future gold but the country's regulatory authority imposed restrictions on the action. The firm overcame this problem by using subsidiary companies in the Isle of Man.
Ashanti's numerous credit facilitators also increased the complexity of the deal. Restrictions imposed by the company's existing revolving credit facility, breach financing and holders of Ashanti's exchangeable loan notes needed renegotiation. "We're dealing with companies with different credit ratings and lenders with different expectations of the deal," says Barratt.
But the transaction was completed in three months, an unprecedented time scale for a limited recourse financing deal in Sub-Saharan Africa.
Allen & Overy (A&O) acted for Dresdner Kleinwort Wasserstein. Brian Harrison was lead partner aided by associates Jonathan Simpson, Antonia Lester, Michael Brown and Emma Fleming.
Apax Partners acquires Ericsson Solutions Channel
Value: $480m (£336.81m)
International private equity group Apax Partners Funds boosted its telecom industry with the acquisition of Ericsson's Enterprise Solutions Channel (EESC) business in March.
The company, which is developing as a global solutions provider with investments in online utility assistant Infomedia and new media publisher Future Network, spent $480m (£336.81) on the direct sales and services branch of Ericsson.
The transaction spanned 18 countries and took almost eight months to complete.
CIBC World Markets and UBS Warburg arranged bank financing for Apax. A senior debt facility of euro148.8 (£91.36) and a euro100m (£61.4m) mezzanine debt facility was set up. Other financing strategies included a $98m (£68.76m) equity tranche, vendor financing and a performance bond facility. The new company, known as Enterprise Solutions, took 2,400 employees from EESC.
White & Case acted for CIBC and UBS Warburg. Maurice Allen, head of bank finance in London, led the project team with head of intellectual property (IP) in Europe David Llewelyn and US-qualified acquisition finance partner Mike Goetz. "There are structural and logistical problems," says Goetz. "We've to put the appropriate debt in the appropriate places."
White & Case lawyer John Runeckles directed IP matters and Antonia Rawlinson, Emma Webster, Peter Kay, Barbara Kong and Elizabeth Porcher dealt with bank finance matters.
Apax Partners were represented by Clifford Chance's corporate partner David Pearson and finance partner Richard Starples.
Privatisation of Abu Dhabi's water and electricity supply
Value: $1.5bn (£1.05bn)
The privatisation of Abu Dhabi's water and electrical supply created the most expensive power project in the region. The proposal, called Independent Water and Power, was announced in March this year together with costs of $1.5bn (£1.05bn). Barclays Capital, Citibank and the Royal Bank of Scotland were among the seven arranging banks.
Partners Nick Buckworth and Kenneth MacRitchie from Shearman & Sterling's project development finance department, advised the banks. "The project was difficult to structure because we were managing a large group," says Buckworth.
International Power with CMS Energy clinched the deal to build a power generator capable of adding 1,350 megawatts to the existing 1,500 megawatt grid, and a seawater desalination plant with an output of 100 million gallons a day.
Bids for the deal reportedly came from the US's AES, Belgium's Tractebel with Mitsui & Co, Tokyo's Electric Power Company, and the US's PSEG Global with Japan's Marubeni Corporation.
Although there was a beauty parade for the project, Shearmans had previous experience in the United Arab Emirates through two earlier independent power ventures, Taweelah A1, a refurbishment contract, and Taweelah A2, the first private water and power plant.
CIT buys 30 aeroplanes from Airbus
Value $1.4bn (£982m)
In a depressed airline market, Airbus clinched a sale on a new fleet. The European aeroplane manufacturer won an order to supply 30 airbuses to the US's CIT Group.
The New Jersey-based buyer bought 25 150-seat A320 airbuses and five A330-200 long haul carriers for $1.4bn (£982m) in January this year. The deal took CIT's total purchases from Airbus to 80 aircrafts in two years.
Export credit agencies of the UK, France and Germany supported this deal and CIT appointed the bank's syndicate agent ABN Amro as lead project manager.
ABN Amro also became the UK's and France's main lender, facility agent and security trustee. Dresdner Bank was the German lead manager and lender.
Denton Wilde Sapte advised ABN Amro and banking partner Nick Chandler directed their team. "Although Dentons has acted for banks and the Export Credit Guarantee Department on European export credit agencies' facilities, this one offers the most flexibility for the operating lessor," says Chandler. "It is a great deal to be involved in."
Associates Catherine Astruc and Lee McLernon assisted Chandler. White & Case represented CIT.
BT sells Yell to Apax Partners and Hicks Muse Tate & Furst
BT's sale of its directory business Yell was one of the biggest private equity deals in Europe. In June 2001, Hicks Muse Tate & Furst formed an equal partnership with Apax Partners to buy Yell, the leading provider of classified advertising in print, telephone and online media.
Weil Gotshal & Manges' strong relationship with Hicks Muse helped it scoop a major role in the deal as both buyers' adviser. Managing partner Mike Francies, who worked on Hicks Muse's United Biscuits and Hillsdown deal in the late 1990s, led a team of 50 lawyers on the project.
Partners included banking partner Helen Burton on debt work, corporate tax senior assistant Sarah Priestly, and IP and technology partner Barry Fishley. The US purchase of Yellow Book directories was overseen by US corporate partner Akiko Mukimo from London.
"Coordinating the US and UK tax structuring is very difficult" says Francies. "It takes complex planning. We have to consider partners with different interests."
Negotiations were held with shareholders on both sides of the Atlantic.
The Apax/Hicks Muse bid was challenged by another private consortium, US-based Kohlberg Kravis Roberts & Co and Texas Pacific, in a sale that BT hoped would raise £3bn to help clear its £28bn debt. The price was lowered when regulators imposed pricing restraints on the business.
Apex received management advice from Travers Smith Braithwaite company partner Mark Soundy. Debt providers Merril Lynch and CIBC helped finance the £2.14bn deal with a £1.45bn debt package. They were guided by Clifford Atkins from Shearmans.
Nomura buys Le Meridien
Last month brought the undoing of one of the most prolific takeovers of the 1990s. Granada purchased the Forte hotel chain in 1996 for £4bn, but now the Forte complex has been sold. Le Meridien, an international hotel chain, was the last part of the Forte operation up for grabs.
The deal, which was completed in three weeks, crossed 14 jurisdictions and created a complex debt structure.
In May, Nomura International, part of the Japanese bank, beat off competition from US hotelier Marriott to capture Meridien. The chain, which has 150 hotels in more than 125 locations, was sold for £1.9bn.
Merrill Lynch International and CIBC provided just under £1bn senior debt and senior mezzanine debt for the deal, secured on hotels around the world. A&O advised them. Its instruction involved more than 100 lawyers in nine international offices, including Frankfurt, Paris, Milan and Warsaw.
A&O banking partner David Morley led the London team with partner Cindy Cook, who directed corporate matters. "The size, speed and complexity of the deal sets it apart from most," says Morley.
The deal incorporated more than 500 lawyers worldwide. Clifford Chance real estate partner Arthur Dyson and finance partner Richard Pettit advised Nomura on financing the deal.
CMS Cameron McKenna partners Richard Price and Louise Wallace oversaw the corporate side of the deal for Nomura, while the Compass Group was guided by Freshfields corporate partner James Davis and real estate partner Mark Wheelhouse.
The deal followed a seven-month hotel auction, where Compass raised £3.26bn from four sales. Four London Signature hotels went to various buyers. The Posthouse chain was seized by Bass, and Heritage country hotels was bought by Macdonald Hotels.
Compass says that it will use the money gained from sales to carry out in-fill acquisitions.
De Beers goes public to private
This year, the world's leading gem producer De Beers was bought out by a consortium of international companies. It produced one of the world's most complex transactions and required an assortment of top-class law firms.
Ashurst Morris Crisp, Clifford Chance, Freshfields Bruckhaus Deringer, Linklaters & Alliance and Webber Wentzel Bowens were involved in the public to private acquisition. Their clients channelled their bid through newco DB Investments.
Ashursts senior partner Geoffrey Green and his team comprising corporate partner Nigel Stacey, international finance partner Mark Vickers and corporate solicitor Anthony Clare advised Debswana Diamond Company.
Maitland & Co, the European presence of Southern Africa's Webber Wentzel Bowens, advised Central Holdings with Freshfields.
Mining company Anglo-American received advice from Linklaters banking partner Benedict James, assisted by Shelley Mottershead, Rob Azurdia, Rafique Ismail and Nick Moore. Its corporate finance team was led by corporate partners David Cheyne and Michael Sullivan.
The three companies were seeking to facilitate a leveraged-buyout of De Beers for £12.9bn, and in April 2001, DB Investments raised £3bn with revolving facilities.
The consortium's financial advisers were UBS Warburg and Dresdner Kleinwort Wasserstein. Both were advised by Clifford Chance. Corporate partner Iain Hunter oversaw the corporate side of the deal, while finance partner Malcolm Sweeting led the banking team with assistant Stephen Lucas. Lucas says: "Public-to-private acquisitions are becoming increasingly large. The De Beers acquisition is a market-defining transaction."
In June 2001, De Beers, which had been publicly owned for more than a century, became a private company.
E-Plus Mobilfunk GmbH granted largest amount of funding in its sector
Value: euro2.5bn (£1.54bn)
A mobile phone company rang the changes in a market where others are finding it hard to get through.
In April, German telecoms company E-Plus Mobilfunk secured the largest amount of funding in the non-investment grade sector.
The company got euro2.5bn (£1.54bn) to refinance its debts and develop a universal mobile telecommunications system (UMTS) network - the next stage in mobile technology, where handset screens show videos.
Bank of America, Deutsche Bank, JP Morgan Chase & Co, Citibank and Salomon Brothers International financed the deal equally. The money, issued on a flexible structure with vendor financing potential, was secured on E-Plus assets. A clause also enabled the company to sell or lease roadside signal towers.
Linklaters banking partner Jeremy Stokeld was lead adviser for the financiers. "The money comes at a time when the market is suffering from a slowdown," he says. "The deal will help E-Plus to move forward."
The deal spanned England, Germany, Luxembourg and Holland.
Banking partner George Link and banking associate Kathy Bell-Walker advised E-Plus from A&O's Frankfurt office.
Morgan Grenfell Private Equity acquires Whitbread's pub estate
Value: £1.625bn and £262.5m
As the bell rang for last orders, three thirsty punters launched a nationwide brawl. Morgan Grenfell Private Equity took on Punch, Nomura and Candover/Pubmaster in a hotly contested battle for the ownership of 3,000 Whitbread pubs in March 2001.
Morgan Grenfell looked to its usual adviser A&O for help, but it had already sided with the target, trying to arrange a securitisation plan with Deutsche Bank for Whitbread. Instead, Freshfields scooped the multibillion-pound coup and went on to win the battle for Grenfell.
Despite Freshfields' success, worth £1.625bn, Chris Hanna, senior associate director at Morgan Grenfell, says that the firm was second choice. "We normally use A&O, but they were conflicted out so we used Freshfields," he says. But he adds: "We've been thoroughly impressed by it."
In just one week the sale of the estate was announced, auctioned and sold, and Morgan Grenfell became the UK's fourth-largest pub owner, acquiring sizeable chains such as Hogshead, Casa and Dome.
Freshfields corporate partner Patrick Gaynor led the advisory team, with partners David Winfield, who oversaw banking aspects, and John Fordham, who dealt with property matters.
"There's an enormous amount of work still to be done," says Winfield. "But there's an element of partnership between the banks and the equity. A major internal reorganisation is required before the securitisation can be done. We have to ensure that none of the aspects of this reorganisation prejudice the banks along the way."
Feverish pub activity continued in April, when Morgan Grenfell announced plans to sell more than 500 pubs. Again, Freshfields stepped in, and corporate partner Jeffery Roberts directed the sale of 439 pubs to Enterprise Inns for £262.5m.
Sean Watson from Camerons advised Enterprise.
VSZ sells subsidiary to US Steel
Value $495m (£347.26m)
The communist's flagship company joined forces with the US in November. VSZ akciova spolocnost Kosice (VSZ), the Slovakian steel conglomerate, sold its production business SteelKO to a Dutch subsidiary of US Steel.
Before the $495m (£347.26m) sale could take place, VSZ shareholders were consulted. There were fears that the company's communist reputation would falter under a US banner, but 99.9 per cent of VSZ shareholders approved the transaction. It launched Slovakia's largest restructuring programme and led to new practice solutions, the incorporation of English restructuring laws and tests of untried legislation.
Linklaters acted for VSZ on the deal, which sought to consolidate the company's debts. Restructuring group partners Jo Windsor and Tom Wells led managing associates Richard Bussell, Gavin McLean and Bruce Bell on the project.
"This is a fascinating project," says Windsor. "We were told it would be difficult and that it could not be done, so it's satisfying seeing the plan go smoothly."
The process involved dividing the VSZ group, which has more than 100 branches, and negotiating its links to countries that include the UK, Poland, Russia, Germany and Austria.
US Steel was required to make a $700m (£491m) inward investment to the Slovakian steel industry over 10 years, and several contracts between SteelKo and VSZ's second company OldCo were terminated.
Government support was also coveted for the Slovakian/US venture to obtain anti-monopoly approvals. President Clinton sent a congratulatory telegram to the Slovakian prime minister Mikulas Dzurinda. It read: "This restructuring means a clear future for thousands of workers and their families, a future not only for the steelworks, but also for the region."
A&O banking partners Katrina Buckley and Gordon Stewart advised the deals creditors, Dutch bank ING, Chase Manhattan and local Slovak banks. Weil Gotshal banking partner Bruce Johnson advised US Steel.
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