French private equity group PAI’s championing of Linklaters has helped win the law firm its second instruction by CIBC World Markets on CVC’s recent £372m acquisition of Danske Traelast.
The deal, CVC’s second this month after buying Viterra Energy Services (see lead story), saw CIBC provide backing to the private equity company’s successful bid for Nordic building materials supplier Danske.
Linklaters was first instructed by CIBC last year in unusual circumstances, when PAI (formally Paribas Affaires Industrielles, which was spun off from BNP Paribas in June last year) completed the $1.5bn (£949.4m) secondary buyout of workwear and linen rental company Elis from BC Partners.
At the time, PAI insisted that CIBC, which replaced a lender which had dropped out of the deal, use Linklaters, despite opposition from the bank. CIBC and Crédit Agricole were the co-lead arrangers on the deal.
On the Danske purchase, Linklaters’ banking practice advised all of CVC’s lenders, with the backing of the private equity group, which has a relationship with the law firm in both finance and M&A.
Commenting on PAI’s referral policy, which requires banks to use its three preferred firms – Ashurst Morris Crisp, Gide Loyrette Nouel and Linklaters – a source said: “[PAI] makes sure it has a limited number of firms offered to the lending banks, because it means [PAI] can move faster.”
Although PAI has no formal system for referrals in place, a source said the private equity house would move towards a more “formalised” system.
It is understood that there have been no fee discounts negotiated by Linklaters, although a source said that limiting legal advisers would save on billings, because the firms would already be familiar with the documentation.