Arthur Cox, A&L Goodbody to act on sale of First Active

First Active acquiror RBS looks to Linklaters and A&L Goodbody in 2003’s largest Irish corporate deal

Arthur Cox and rival A&L Goodbody have picked up heavyweight instructions on Ireland’s biggest corporate deal so far this year, the e887m (£619.2m) acquisition by the Royal Bank of Scotland (RBS) of mortgage provider First Active.

Arthur Cox’s longstanding involvement with First Active secured the work. Ronan Walsh, the First Active client partner, advised Ireland’s fifth-largest bank on its dual listing in Ireland and London in 1998. Walsh is again involved in the current deal, along with M&A partner Colm Duggan, tax partner Caroline Devlin and John O’Dwyer, who is handling employment issues.

News of the deal broke on Monday 6 October with a Rule 2.5 announcement issued by RBS. Under Irish law, this official announcement of the intention to make an offer is the first step towards a takeover.

The offer, unusually for the Irish market, is being made by way of a court-approved scheme of arrangement, pursuant to Section 201 of the Irish Companies Act. This is partly because of the size of First Active’s enormous shareholder base of 140,000.

The deal’s timetable in-volves the publication of a shareholders’ circular within 28 days of the Rule 2.5 announcement, along with High Court, shareholder and regulatory approval. Approval will be granted assuming RBS secures both a majority in the number of shareholders and 75 per cent of the value of the company.

The team from A&L Goodbody is advising RBS on local law issues, although the bank’s bid is being led out of London with a Linklaters team, featuring partners Robert Elliott and Conor Hurley on banking and tax issues respectively. Merrill Lynch is financial adviser to RBS, while JPMorgan is advising First Active.

Duggan at Arthur Cox, who has worked before with Linklaters lawyers – specifically Hurley on the Vodafone-Eircom deal in 2002-03 – said that the last few months in Ireland had seen an acceleration in the number of deals.

“There seems to have been more M&A activity in the third quarter of the year than in the previous two quarters, as a result of the recovery in the stock markets and the underlying strength of the Irish economy,” said Duggan.