Cravath Swaine & Moore and Herbert Smith have scooped lead roles advising AOL UK on its potential £1bn sale.
A deadline for bidders to declare an interest in buying the internet company passed at 5pm today (Monday 12 June), with BSkyB and BT among the favourites. However, it is still unclear whether AOL UK’s US parent, Time Warner, will put the company up for sale.
Should the much speculated sale proceed, Cravath is expected to advise long-standing client Time Warner on US aspects of the deal with Herbert Smith taking the lead on UK law.
The interest in purchasing AOL UK was sparked by Time Warner last month, when it instigated a strategic review of its European businesses by Citigroup. The review is due to conclude this week and is expected to recommend the sale of AOL UK.
Other options include a joint venture partnership, an arrangement that has already thrown up names such as Vodafone and O2, or do nothing.
AOL UK’s investment of around £120m in its own local loop infrastructure over the last year, however, makes it an attractive target to a company looking to increase its broadband coverage.
It is expected that by mid-2006 AOL UK will have unbundled around 300 UK exchanges and will be free to begin moving its 1.3m broadband users over to its own infrastructure.