Slaughters defends Bestfoods takeover

Slaughter and May is preparing to do battle with the European Commission as Unilever finally wins control of US rival Bestfoods.

The $20.3bn (£13.3bn) take over of Bestfoods, on which Unilever is is also paying $4bn (£2.6bn) of debt, was approved by its shareholders on 7 June, and will create the second largest consumer products company after Nestlé.

But it is yet to be approved by the EC and the Federal Trade Commission.

Slaughters competition partner Malcolm Nicholson, who worked with a team of five on the deal, says: “It is more a question of combined market share since it is now going to be in a dominant position. In any international transaction it should be clear that there will need to be concessions made and there will be overlap in certain areas.”

A source says competition authorities will be paying close attention to certain products.

Slaughters continues to work with US firm Cravath Swaine & Moore on advising Unilever, which has a dual listing in the UK and Holland.

Bestfoods has employed the services of Fried Frank Harris Shriver & Jacobson on corporate law and Wilmer Cutler & Pickering on anti-trust issues, including partner Bill Kolasky in Washington and John Ratliff, a partner at the Brussels office.

The battle to take over Bestfoods has been raging for over a month, though Nicholson says he has been working with Unilever on the deal for over a year.

Unilever initially offered $66 (£43.34) per share for Bestfoods, but was forced to raise the bid to $77 (£50.56) after the US firm refused the price and began serious merger talks with Campbell Soups.

Bestfoods general counsel Eduardo Sanchez, who acted with an in-house team of 12 on the deal, says: “We were also in other life and death situations. I must admit that we were working on two other deals at the same time.”