Asia is as much an emerging market as it is a sophisticated one. There has been a raft of restructuring – a result of the Asian crisis – and privatisation is still a relatively new area that experienced UK firms are able to cash in on. But there has also been some mammoth M&A deals and the flotation of the Hong Kong Stock Exchange in June has boosted initial public offering (IPO) work. There has been a lot of work in that sexy stable of European deals during the past 18 months, technology media and telecoms, and there has been an increase in securitisation throughout the region.
Hong Kong's Mass Transit Railway (MTR) was privatised, and included an IPO in October 2000. Baker & McKenzie, Freshfields Bruckhaus Deringer (led by partner Teresa Ko, left), Slaughter and May and Sullivan & Cromwell all acted on the first ever Hong Kong privatisation. More public to private deals are expected to follow as the government gets its sell-off programme underway.
Hutchison Whampoa made a $3bn (£2bn) bond issue in September 2000. Under the terms of the deal, Hutchison Whampoa sold bonds that could be exchanged into a 0.9 per cent stake in Vodafone. That made it the largest exchangeable bond issue ever by an Asia issuer. Allen & Overy (A&O) advised global coordinator Merrill Lynch.
Pacific Century CyberWorks (PCCW) completed a securities issue in November 2000. This $2.9bn (£1.98bn) deal was one of a trio of big-league transactions in which Simmons & Simmons acted for new client PCCW. The office first advised PCCW on its merger with Cable & Wireless HKT, represented by A&O, in August. Two months later, Simmons was instructed again on its alliance with Telstra, which was advised by Clifford Chance. PCCW is quite a catch for Simmons' Hong Kong office and has contributed to the firm's growing financial success. The relationship is centred around head of corporate Nick Norris (left). The firm keeps a close eye on the figures to make sure, in the words of corporate partner Paul Li (below), it is not “too reliant on the single client”, but PCCW is undoubtedly a winner for Simmons' Asia operations.
Nam Yue Group and Guangdong Enterprises restructured a $4.4bn (£3bn) debt, one of the largest restructurings in China's history. The deal lasted for two years and completed earlier this month. It was particularly significant in that both companies were two of the principal offshore investment vehicles of the Guangdong Provincial Government. A&O (led by Mark Sterling, head of the Asia business reconstruction group) represented the steering committee of the banks' creditors with PricewaterhouseCoopers acting as financial adviser. Standard Chartered Bank was the liason bank. Included in the restructuring was the privatisation of the Dongshen Water Project, the financing of a $600m (£408m) renovation for the water project, and a corporate reorganisation.
Vodafone acquired a 15 per cent stake in Japan Telecom for $2.2bn (1.5bn) in January 2001. Herbert Smith and Tokyo Marunouchi Law Office advised two of the founding companies of Japan Telecom, which was selling its stake. Andersen Mori represented Vodafone. The deal is the second largest investment in Japan by a foreign investor (the first one being Renault's investment in Nissan two years ago).
Virgin Mobile is in talks to set up a joint venture with SingTel. Virgin Mobile launched in Australia in 2000 and is near completion on its bid to open in Singapore using its unique mobile virtual network operator (MVNO) model. Ashurst Morris Crisp is advising Virgin once more, having been instructed on the UK and Australian launches.