Slaughter and May seven-year associate James Cook took a leading role in advising on RSA Insurance Group’s £7.2bn acquisition by listed Canadian insurer Intact Financial Corporation and listed Danish insurer Tryg A/S last summer. In May 2021 he was made a corporate partner.
“This was probably my last major deal before I became a partner, and it’s exactly the kind of high-speed, complex and significant transaction that I hope to see plenty more of”, Cook recalls. “At the risk of sounding cheesy, deals like this are genuinely the reason that I enjoy doing what I do so much!”
RSA Insurance – UK’s largest M&A deal of 2020
Slaughter and May fielded a 20-strong multi-disciplinary team to advise on what turned out to be the largest UK public M&A transaction announced in 2020.
Led by the firm’s head of corporate Andy Ryde, the team consisted of experts in public takeovers, business separations and restructurings, debt and equity financing, pensions, financial regulation, antitrust, share incentive schemes and employment.
“The biggest technical challenge of this job was bringing all the moving pieces together. Not only was it the largest public takeover announced in 2020, I would say it was also the most complex”, Cook says.
As will all major deals of this period, the work was done under the confines of lockdown. “The parties to the transaction were spread over three different countries and time zones, and in the past that might have involved large amounts of travel and multi-day all parties meetings. That was replaced by short, quick check-ins between small groups of relevant people as and when they were needed to deal with issues – which was definitely more efficient”, Cook adds.
“One of the key things I love about this job though is the team spirit and the fun around that even when we are working very hard. Without doubt, that is something that takes a lot more work to maintain when everyone is working from their bedroom or kitchen table. So, I do think there is a “best of both worlds” that we can, and are, aiming for going forward.”
James Cook’s professional background
Cook joined Slaughters as a trainee solicitor back in September 2011, spending 18 months in the London office and six months in the Hong Kong office during his training contract. He qualified into the corporate team in September 2013, and has been there ever since, including a six-month secondment to Rothschild’s Global M&A Specialist Advisory team in 2015.
He’s racked up an impressive roster of deals in that time, advising on the likes of Vodafone’s €18.4bn acquisition of Liberty Global’s business in Germany in August 2019, and advising Rolls Royce on its proposed recapitalisation package, including its £2bn rights issue, in late 2020.
Since the RSA transaction, Cook says the firm has continued to see a high level of M&A activity, “a trend which started around Q3 last year and has continued”, he explains. “There’s been a lot of press about how this has been fuelled by financial investors having “dry powder” to deploy, but we are also seeing many corporates looking to make strategic moves. Most recently, I have been supporting Reckitt on its key strategic sale of its Infant Formula and Child Nutrition business in China to Primavera.”
How the complex RSA deal was got over the line
To successfully compete the RSA deal, Slaughters designed a structure that enabled the business to be divided, so that Intact would hold its Canadian, UK and international businesses, Tryg would hold the Norwegian and Swedish businesses, and both buyers would hold RSA’s Danish arm in a joint venture that could be sold to a third party.
The bidders and RSA reached an agreement on a complex security package designed to provide protection to the RSA pension schemes involving guarantees, equity subscription arrangements and payment direction agreements.
The team obtained 18 antitrust, financial regulatory and other regulatory approvals within six months of the transaction being announced. The financing structure put in place meant that the bidders executed their various financing arrangements smoothly, in the correct timeframe and delivered the necessary ‘certain funds’.
Among the multiple innovative structures put in place to deliver this transaction, was a pre-wired separation of RSA’s Scandinavian business, committed to in a court-approved scheme of arrangement, to provide certainty that the separation could take place at completion and the bidders were ensured of the necessary division of the RSA group.
There was a joint venture holding structure for RSA’s Scandinavian business, with custom-designed governance and control mechanisms, to ensure compliance with antitrust laws and financial regulation.
The overseas nature of the bidders, separation of the RSA group and future expected changes in pensions law required a bespoke structure to be designed and implemented from scratch, and conditionality. Funding and FX mechanisms were required to allow the bidders to meet the necessary ‘certain funds’ requirements of the Takeover Code, while funding the transaction through a combination of CD$ cornerstone, MTN and bought deal private placements, GBP bridge and term loan facilities and an underwritten DKK Rights Issue.
The cross-firm team led from the outset on the RSA side on the design, assessment and execution of all aspects of this unique structure, working very closely with RSA’s general counsel and chief finance officer.
The structure required multiple re-designs and involved co-ordination with the bidders’ advisory teams, financing providers, investment banks, regulators, Queens’ Counsel and multiple client teams.
Ultimately, the firm’s ability to field a team with wide-ranging expertise, a close working relationship with each other and a holistic view of each piece of the transaction was critical to delivering an executable transaction at high speed.
About James Cook
2021-present: Partner, Slaughter and May
2013-2021: Associate, Slaughter and May
2011-2013: Trainee, Slaughter and May
Who’s Who: the Slaughter and May corporate team
Corporate: Andy Ryde and Robert Innes (partners), James Cook, Sonya Mononen, Ellie Nugent (associates), Alexander Cranstoun (trainee)
Competition: Jordan Ellison (partner), Jonathan Slade, Andrew Gilbert, Gareth Goh (associates)
Employment: Padraig Cronin (partner), Rosemary Nelson (associate)
Financial regulation: Nick Bonsall (partner), Tom Hilton-Stevens (associate)
Financing: Guy O’Keefe (partner), Claire Cooke (associate)
Pensions: Daniel Schaffer (partner), Sophia Russell (trainee)
Tax: Mike Lane (partner), Alex Sim (associate)