Number crunching: King & Wood Mallesons

Many unions are a result of the long-term relationship between couples, but the link between China’s King & Wood and Australia’s Mallesons Stephen Jaques seems like love at first sight.

Information provider Thomson Reuters’ data on the pair’s M&A transactions from 2007 to 2011 reveals that the firms, which are set to combine their operations through a Swiss Verein structure on 1 March, have rarely co-counselled.

Thomson Reuters recorded a total of 740 deals in which Mallesons was involved either as the target’s or the acquiror’s counsel. There are 72 recorded deals involving King & Wood in the same period.

However, in none of these deals have the two met, either representing the same client or advising the opposite sides.

Interestingly, while negotiations about the firms’ tie-up were ongoing in 2011 King & Wood worked on two major M&A transactions with other Australian firms. It co-counselled with Freehills on Chinese coal producer Yanzhou Coal Mining’s planned $2.7bn (£1.74bn) acquisition of Australia’s Gloucester Coal and worked alongside Minter Ellison and Ashurst in China Guangdong Nuclear Power Group’s $1.23bn acquisition of Namibian miner Kalahari Minerals.

Despite several big-ticket Chinese outbound deals, more than 70 per cent of King & Wood’s transactions were domestic, with both parties based in China. In comparison, about half of Mallesons’ 740 deals had a cross-border element, but only 18 involved a Chinese buyer or target.

Among the Australian firm’s China-related transactions the withdrawn bid by state-owned Aluminum Corporation of China (Chinalco) to acquire shares in Rio Tinto for $19.5bn in 2009 is one of the most high-profile. In the same year it scored the Australian legal counsel role for Chinese steelmaker Hunan Valin in its $645m acquisition of a stake in Australian miner Fortescue Metals.

In China the firm has a shorter deal list, but enjoys a long-term relationship with Beijing-based property developer Soho China.

It has advised on a number of the company’s acquisitions in China as Hong Kong legal counsel and regularly worked with its China legal counsel Zhonglun. Although Mallesons has offices in Beijing and Shanghai, it has only won two China mandates from Australian acquirors, Telstra and Horizon Oil.

Outside China Mallesons is an adviser in US- and UK-related transactions. It has advised on 157 deals with a US element, making the US the largest part of Mallesons’ cross-border portfolio, and played a role in 69 UK-related deals.

Among the international firms Mallesons has worked with, it has co-counselled on the largest number of deals with Clifford Chance (35) – with which it held brief merger talks in 2008 – and white-shoe firm Simpson Thacher
& Bartlett (30).

Target: WongPartnership?

Following its tie-up with King & Wood, Mallesons is contemplating further expansion in Asia. The firm has confirmed that it is in talks with Singapore firms including WongPartnership, about a possible merger.

In five years the firm has worked with WongPartnership on no fewer than 10 occasions, including BlackRock’s $13.5bn (£8.7bn) acquisition of Barclays Global Investor, China National Offshore Oil Corporation’s $2.5bn takeover of Norway’s Awilco Offshore, Chinalco’s $14bn share acquisition of Rio Tinto in 2008 and the $645m Hunan Valin-Fortescue Metals share acquisition.

Top five deals in 2011

  1. Mallesons advised AXA Asia-Pacific Holdings on its merger with AMP in a $13.1bn (£8.45bn) deal
  2. Mallesons played a role in SABMiller’s $12bn proposed acquisition of Foster’s
  3. King & Wood, together with Skadden and Houthoff Buruma advised Beijing Hainachuan Automotive Parts on its $270m takeover of the Netherlands’ Inalfa Roof Systems Group
  4. King & Wood and Freehills acted as the acquirer’s advisers in coal producer Yanzhou Coal Mining’s planned $2.7bn acquisition of Australia’s Gloucester Coal
  5. King & Wood worked alongside Minter Ellison and Ashurst in China Guangdong Nuclear Power Group’s $1.2bn acquisition of Namibian miner Kalahari Minerals