Freshfields breaks EU merger barrier

Clearance of the Hewlett-Packard-Compaq merger is particularly gratifying for Freshfields because it follows hard on the heels of the European Commission's decision to block both Schneider-Legrand and Tetra Laval-Sidel.
The Freshfields team was led out of the London office by antitrust partner Jenny Connolly, supported by Rod Carlton. Connolly was previously a Freshfields corporate partner, but switched to antitrust two years ago. She has a long relationship with Hewlett-Packard and masterminded the corporate aspects of its global demerger from Agilent Technologies. Hewlett-Packard has traditionally used Linklaters for complaint-based antitrust work, but preferred Connolly on its first big EU transaction.
Other law firms have hit a brick wall on big mergers since last July. Clifford Chance and Shearman & Sterling were rebuffed by the commission in the GE-Honeywell decision, which Simon Baxter at Clifford Chance is still appealing. Skadden Arps Slate Meagher & Flom fared even worse, as Honeywell axed Jim Venit's Skadden team when the merger failed.
Wilmer Cutler & Pickering advised Tetra Laval on the blocked $1.5bn (£1.06bn) takeover of French packaging manufacturer Sidel, which has left the Swedish company with over 95 per cent of Sidel's shares. Allen & Overy client Schneider Electric is stuck with 98 per cent of the shares in French manufacturer Legrand, which the commission has now ordered it must completely divest.
Freshfields lawyers benefited from the absence of political involvement in the Hewlett-Packard case. GE-Honeywell and Schneider-Legrand both showed that it is unwise to attempt political persuasion, whether your lobbyist is George W Bush or Jacques Chirac. Hewlett-Packard kept politics out of the merger and ducked press coverage wherever possible.
Sources close to Hewlett-Packard said that Freshfields got it right tactically by addressing as many of the commission's issues as possible before actually filing last December. Freshfields' task was also made easier by the commission caseworker on Hewlett-Packard – investigator Paul Mallerick Smith is described by Brussels insiders as “tough but highly professional”, in contrast to the GE-Honeywell investigator Enrique Gonzalez, who has a reputation as being “extremely difficult”.