Linklaters has strengthened its foothold in the private equity arena after advising new client property tycoon Robert Tchenguiz on the acquisition of Odeon, the UK's largest cinema chain. The firm also won the debt finance work for the newco.
The acquisition of Odeon from Cinven is the second largest private equity deal Linklaters has completed since former SJ Berwin partner Graham White was hired in autumn 2001 to spearhead the firm's drive into private equity. The previous deal was when White was instructed last year by Clifford Chance and Ashurst Morris Crisp client CVC Capital Partners in relation to the acquisition of Kwik-Fit from Ford.
Iranian-born Tchenguiz, the co-owner of Rotch Properties and former boyfriend of model Caprice Bourret, teamed up with lead investor German investment bank WestLB's Principal Finance Group and Entertainment Film Distributors on the £431m secondary buyout.
The Odeon acquisition is the first private equity deal Linklaters has completed for Tchenguiz. Historically, the firm has advised him on property work.
Privately-owned Entertainment Film Distributors, which was advised jointly by Linklaters and Richards Butler, distributes a number of blockbusters, including Lord of the Rings.
The acquisition was financed by £330m of debt finance by WestLB and Lehman Brothers. The magic circle firm also advised Castle Equity Co, the acquisition vehicle on the banking aspects of the deal. Linklaters was introduced to Castle Equity through Tchenguiz and Alethia Partnership, the buyout firm launched by former head of Morgan Grenfell Private Equity, Scott Lanphere. Last October, Alethia planned to raise £500m backed by Tchenguiz.
Weil Gotshal & Manges advised WestLB and Castle Equity on the private equity aspects of the deal. This is the largest private equity deal that the US firm has ever advised WestLB on.
Corporate partner Mike Francies, who led the deal for Weil Gotshal, said: “WestLB is a longstanding client of the firm. We were pleased to have been instructed on a large M&A deal in what is still a quiet market.”
Cinven was advised by Freshfields Bruckhaus Deringer corporate partner David Sonter, while Simon Tinkler of Clifford Chance acted for Richard Segal, Odeon's chief executive, and other members of the management team. Even though WestLB acquired the majority stake in Odeon, Segal has held onto his post of chief executive.
The Linklaters team was led by White and corporate associate Raymond McKeeve.