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21 November 2005
Most corporate lawyers continued to have their hands full in November as both the M&A and equity markets remained buoyant. According to Thomson Financial, 260 deals (involving any UK element) totalling $34.6bn (£19.97bn) were announced last month. In contrast, October saw 249 deals valued at $84bn (£48.48bn) being announced.
The recent wave of Russian businesses seeking listings in the UK gifted Debevoise & Plimpton an instruction from Russian steel manufacturer Novolipetsk, which is set to float on the London Stock Exchange (LSE) with a value of £6bn - the biggest UK flotation for five years. It is understood that Debevoise secured the role after its Moscow office initiated a relationship with Novolipetsk. Linklaters is acting for underwriters UBS and Merrill Lynch.
Indeed, Linklaters and Freshfields Bruckhaus Deringer have virtually cleaned up on IPOs on the LSE in recent months. As first reported by The Lawyer (21 November), the magic circle firms have secured advisory roles on the £800m Britvic flotation. The soft drinks company, whose brands include licences to Pepsi, 7UP, Robinsons and Tango, confirmed that it is planning to make its stock exchange debut later this month. It is understood that Linklaters is advising Britvic, while Freshfields is acting for Deutsche Bank and Citigroup.
Meanwhile, thanks to Linklaters head of private equity Graham White, the firm also landed a role on the IPO of Gondola Holdings, the owner of the Ask, PizzaExpress and Zizzi restaurant chains. As first reported by The Lawyer (14 November), Linklaters is advising TDR Capital on the float of the restaurant owner, which returned to the LSE last month after a two-year break. The partial flotation, which is the first successful transaction Linklaters has handled for TDR, is understood to have come through some of White's private equity contacts. The Linklaters team was led by corporate partner John Lane.
On the M&A front, Weil Gotshal & Manges (Mike Francies) celebrated the completion of its first successful mandate for Lion Capital and Blackstone Group on their £1.27bn purchase of Cadbury Schweppes' European drinks business. Blackstone and Lion Capital outbid a string of other private equity firms to buy the beverages unit, which includes brands such as Orangina and Oasis. The deal is the first successful bid that Weil has acted on for the private equity houses. Earlier in the year the firm acted for Lion Capital and Blackstone in their failed bid for Allied Domecq, which was eventually sold to Pernod Ricard, advised by Macfarlanes senior partner Robert Sutton. It was also the biggest deal Lion Capital has been involved in since its split from Hicks Muse Tate & Furst in 2004. Cadbury was advised by regular adviser Slaughter and May (Tim Boxell).
Meanwhile, Drax decided to proceed with an IPO after the company's board rejected a takeover approach from a consortium comprising Constellation Energy and private equity firms Blackstone, Perry Capital Management and Hellman & Friedman, which was being advised by Freshfields partner Will Lawes. Drax, the owner of the UK's largest coal-fired power station, is being advised by Norton Rose finance partner Laurence Levy.
The current deal frenzy looks set to continue through the festive period, and indeed well into 2006. So here are some friendly words of advice David Barnes, Tim Jones, Chris Saul, Peter Charlton, Michael Walter et al: while you enjoy you enjoy your moment in the sun, spare a thought for all those poor associates who are likely to be stuck in the office completing deals while you are tucking into your Christmas dinner.