CC and Linklaters act in Whitbread purchase

Clifford Chance and Linklaters have come to the end of a midnight run to complete the purchase of Allied Domecq's retail arm by Whitbread.

The u2.3bn deal was finally completed on 25 May after teams at both firms worked throughout the night to reach an agreement.

Pending a completion period ending 2 August, Whitbread, represented by Clifford Chance, acquires Allied Domecq Retailing UK – advised by Linklaters – and its 3,500 pubs.

Neil Harvey, corporate partner at Clifford Chance and part of the 20- strong team led by senior corporate partner Jeremy Brownlow, says over five different departments including competition, employment and pensions law worked on the deal.

“It is not unusual to have this many people working on a deal. It is inevitable as these things always take time,” says Harvey.

The Linklaters team was led by corporate partner Tom Wethered and involved a number of different departments spanning tax, property, litigation and environment law.

The purchase has been agreed after months of intense speculation which appeared to fall flat just days before Allied Domecq announced the completion.

Rumours had erupted that talks had fallen through over disagreements on increased debt and a reduction in Whitbread's offer.

David Mitchell, group company secretary at Allied Domecq, says: “It is like any other deal where there are little hurdles and big hurdles.”

Mitchell says he worked for over two months with the deputy company secretary and two in-house lawyers, one concentrating solely on due diligence and disclosure issues.

The deal is in the form of a paper offer which will award Allied Domecq shareholders about 230 million new shares, giving them an estimated third of Whitbread.

Whitbread will also launch a capital restructure and a u750m share buy-back.

However, since the agreement became public, rival companies such as Bass and Punch Taverns will now have the chance to enter a bid for Allied Domecq's retail arm.

US private investment partnership Texas Pacific recently bought a 70 per cent stake in Punch for u180m giving it scope to make a counter bid.