FTSE 250 company Essar Energy’s legal team is being restructured following its controversial de-listing and general counsel Sheena Singla is considering an informal panel shake-up as a result.
India’s Essar Capital, controlled by billionaire brothers Shashikant and Ravikant Ruia, made a 70p-per-share offer to take Essar Energy private two months ago. The company was removed from the London Stock Exchange in June following a tussle between the brothers and minority shareholders over the company’s valuation, which was significantly lower than its 420p debut price in a 2010 IPO (19 April 2010).
Lead minority shareholder Standard Life Investments reportedly turned to Skadden Arps Slate Meagher & Flom to resist the delisting. However independent directors of the company recommended the Ruia offer in May after EGFL won acceptances from nearly two-fifths of the minority shareholders in the months after the March offer.
Former Freshfields Bruckhaus Deringer associate Singla worked on Essar’s IPO and led the take-private deal. She will now be moved underneath Essar’s parent company, Essar Global Fund Limited (EGFL), owned by Essar Capital, along with her team, which faces restructuring (25 April 2011).
The shape and size of Essar Energy’s legal capacity is currently under debate however the three-strong group is understood to have already been downsized.
The delisting has prompted an informal review of the company’s external advisers as well as impacting the in-house team.
Currently Singla turns to Clifford Chance, Eversheds, Freshfields, Herbert Smith Freehills, Linklaters, Shearman & Sterling and Wragge Lawrence Graham & Co among others, having drawn up an informal roster following the 2010 IPO.
Singla has retained strong ties to Freshfields since working on the company’s IPO as an associate at the firm with partners Stuart Grider and Neil Radford. She was put in charge of building Essar Energy’s legal team in London after being headhunted from the magic circle firm.
Linklaters partner Charlie Jacobs is also a particularly strong contact, having acted for underwriting banks Deutsche Bank and JP Morgan on Essar’s IPO and advised the company as the target throughout the take-private deal. Clifford Chance partner Tim Lewis ran the deal from the bidder side.
However the company is eyeing up firms with a different offering to magic circle and US firms, particularly targeting those with sector focuses.
Firms like Dentons, whose ‘Division E’ group includes the firm’s UK energy capacity, are in the frame. The company has also set its sights on Ashurst and Baker & McKenzie as firms with a strong geographic reach that operate different models.
Essar is also asking firms to offer capped fees, particularly for project work. However the company is not expected to put in place a formal panel.