Cerberus hands Milbank first UK work in Boxclever buyout

The London office of Milbank Tweed Hadley & McCloy has closed its first deal for US vulture fund Cerberus.

A team led by former Freshfields Bruckhaus Deringer partner Tim Emmerson and including Russell Jacobs and Derek Wee advised Cerberus on its last-minute involvement in the acquisition of the operating assets and securitised debt of Boxclever, one of WestLB’s failed investments.

Cerberus has been active in Europe, but has used a range of law firms, including Ashurst and Freshfields. However, Cerberus has a strong relationship with Milbank in the US and the firm will expect to pick up the lion’s share of Cerberus’s UK work going forward.

Boxclever’s creditors – WestLB and a range of minority creditors, including former Nomura man Guy Hands – recouped what is understood to be around £200m. It is unclear how the money will be split.

Boxclever’s receiver Tony Lomas at PricewaterhouseCoopers (PwC) was advised by Allen & Overy banking partner Gordon Stewart.

The deal has been going on since late 2003, when Goldman Sachs kicked off an auction of Boxclever’s assets. The TV rental company was originally a joint venture between Granada and Thorn, but the two sold out when WestLB’s Robyn Saunders invested in the company and undertook a whole business securitisation.

In March 2004, Cerberus lost out at auction to rival US distressed debt fund Fortress, advised by Weil Gotshal & Manges partners Mike Francies and Jacky Kelly.

However, after months of negotiations between Fortress and PwC, Cerberus re-emerged in partnership with Fortress late last year. Weil Gotshal handled the M&A deal, while Milbank handled the inter-company agreement between Fortress and Cerberus.

Fortress uses Weil Gotshal and Linklaters in the UK, although the fund also has a relationship with Milbank.