DEAL OF THE WEEK – Cinven/Klöckner Hengeler leads the pack on Cinven German buyout

Hengeler leads the pack on Cinven German buyout

German firm Hengeler Mueller has led a team of law firms advising private equity house Cinven on its first major German acquisition.
The firm scooped the work advising on Cinven's v925m (£576.38m) acquisition of Klöckner Pentaplast Group, the second-largest leveraged buyout in Germany this year.
Hengeler Frankurt partner Peter Weyland first worked for the client last year when he helped Lovells advise on the acquisition of Kappa Packaging. He is now the client's main German adviser.
Hengeler called in its New York best friend Davis Polk & Wardwell to advise on US aspects of the acquisition, while Freshfields Bruckhaus Deringer in London advised on the financing side.
Weyland said: “We've a long-established client relationship with Cinven, with whom we have worked on several transactions, starting with the Kappa transaction. It's one of our clients and it's us that brought in Davis Polk. We worked as an integrated team, which was very rewarding.”
The Davis Polk team was led by Frankfurt partner Patrick Kenadjian, with London partner Lydia Kess and New York partner Kathleen Ferrell advising on tax issues.
Kess said: “We have a best friends relationship with Hengeler Mueller, so this is an example of the type of transaction which really works superlatively well if you have that kind of approach. It was a multijurisdictional transaction with a German component and a US component.”
At Freshfields, London acquisition finance partner Sean Pierce led the team, and Cinven called in Kirkland & Ellis in the US to advise on high-yield issues.
Weyland said that the deal is a significant one for the client. “It was very important because it was its first truly German deal,” he said. “The Kappa transaction had a major part in Germany but it was not based in Germany. Klöckner has its origins in Germany, although around 50 per cent of its business is in the US.”
Klöckner Pentaplast is the plastic films division of Klöckner-Werke, the German industrial conglomerate.
Since 1995, Cinven has led buyouts with a total value of more than f20bn (£12.46bn), and according to Davis Polk, it is the only firm in Europe to have led eight buyouts of values exceeding h1bn (£623m).
Linklaters & Alliance acted for Klöckner on the deal, with a team led out of the Cologne office of Linklaters Oppenhoff & Rädler by partner Wolfgang Sturm.
Cinven financed the deal with the help of Deutsche Bank and Credit Suisse First Boston. Deutsche Bank was the full mandated lead arranger; it was advised by White & Case with a team from London led by US-qualified partner Mike Goetz.
White & Case pulled in its German and New York offices on the deal, and called in the London office of Nauta Dutilh for Dutch law advice. On the high-yield side, Deutsche Bank used New York's Simpson Thacher & Bartlett, which in turn used White & Case's German office for high-yield due diligence because it lacks its own German law practice.