Asia deals roundup: China online video M&A and ASEAN financing deals

Kirkland & Ellis and Skadden Arps Slate Meagher & Flom have bagged the lead counsel roles in the merger of US-listed Chinese online video companies Youku and Tudou, while a number of other firms have reaped the benefit of a high level of financing deals in South East Asia.

The 100 per cent stock-for-stock transaction between Youku and Tudou has been valued at $1bn. The two companies are both listed in the US, with Youku completing its IPO on the New York Stock Exchange in December 2010 and Tudou listing on NASDAQ in August 2011.

In the merger deal, US firm Skadden is lead counsel to Youku, with Hong Kong partners Michael Gisser and Julie Gao leading. Youku was also advised by Beijing-based law firm TransAsia, led by partner Philip Qu, and offshore law firm Conyers Dill & Pearman. Skadden and TransaAsia have been the company’s legal counsel since its IPO.

Tudou’s legal team in the transaction consists of Kirkland & Ellis, Shanghai-based Fangda Partners and offshore firm Maples and Calder. Kirkland’steam was led by Hong Kong-based partners David Zhang, Jesse Sheley and Pierre Arsenault. Zhang, who joined Kirkland from Latham & Watkins in August 2011, headed the Latham team that acted on Tudou’s $174m IPO.

Fangda’s lead partner in the transaction was Jonathan Zhou and Maples and Calder’s team was led by Hong Kong partner Greg Knowles. Both firms acted for the issuer in Tudou’s IPO.

The deal is expected to complete by the third quarter of 2012, pending shareholder approvals. Upon completion, Youku and Tudou shareholders will own approximately 71.5 per cent and 28.5 per cent of the combined company, respectively. The combined company will be named Youku Tudou.

In addition to being one of the largest public M&A transactions in China, if completed, this will be the first merger between two unrelated US-listed public companies in China.

In South East Asia, meanwhile, this week has seen a large number of financing deals.

Clifford Chance has scored lead roles in three major financing transactions in the region – the S$1.8bn (£909m) perpetual securities issuance of Genting Singapore, the RM6.5bn (£1.36bn) project financing for Malakoff Corporation’s new power station in Malaysia, and the $500m (£320m) notes issuance of Indian bank Axis Bank

In Genting Singapore’s perpetual bonds issuance, Clifford Chance, led by Hong Kong partner Matthew Fairclough and Singapore partner Raymond Tong, advised the underwriters – DBS, HSBC, Deutsche Bank, JPMorgan and CIMB. Allen & Gledhill acted for the issuer. Both firms have worked with the issuer in several other transactions. Alongside Clifford Chance, Kuala Lumpur-based firm Adnan Sundra & Low acted as Malaysian counsel to the underwriters. Cains acted for the issuer on Isle of Man law.

The Genting Group, the parent of Genting Singapore, is a leading international casino operator based in Malaysia. The bonds issued are perpetual, meaning the issuer does not repay the principal, and carry an annual yield of 5.125 per cent. The issuance is the largest-ever hybrid offering in Asia.

“We continue to see real interest in the hybrid securities market across Asia, and particularly in Singapore. Very high quality names are coming to the markets, with investors showing great interest in the product,” said Fairclough.

In the project finance transaction, Clifford Chance, led by Singapore partner Ting Ting Tan, acted as international counsel to the lenders to Malakoff Corporation Berhad on the RM6.5bn financing for a new coal-fired power plant in Tanjung Bin. The project will be financed by a combination of senior and junior debt facilities, comprising of Islamic bonds and loans denominated in Malaysian ringgit and US dollars.

The lenders are Sumitomi Mitsui Banking, HSBC, OCBC Bank, Mizuho Bank and The Bank of Tokyo-Mitsubishi UFJ. It is the first participation of international leaders for a power project financing in Malaysia.

Malaysian boutique firm Albar & Partnres advised the lenders on Malaysian law. Malyaisan firms Shearn Delamore & Co, led by partner Tee Joe Lei, and Kamilah & Chong advised the project sponsor, Malakoff subsidiary Tanjun Bin Energy, on the financing and project documentation respectively.

In Axis Bank’s notes issuance,  Clifford Chance, fielding partners Johannes Juette and Matthew Fairclough, advised the underwriters, Barclays, Citygroup, HSBC, JPMorgan and Standard Chartered. Trilegal acted as the underwriters’ Indian counsel. Allen & Overy and Indian firm AZB & Partners represented the issuer.

In Indonesia, the country’s leading coal miner PT Berau Coal Energy has raised $500m from its high-yield bond offering of 7.25 percent guaranteed secured senior notes due in 2017. Jones Day Singapore partner Joseph Bauerschmidt led the firm’s team advising the issuer in the deal.

The underwriters for the issuance, Bank of America Merrill Lynch, Credit Suisse and JPMorgan, were advised by Davis Polk & Wardwell. The firm also advised the underwriters on the $152m (£97m) IPO of Berau Coal Energy on the Indonesia Stock Exchange in 2010.

In addition, a syndicate of Japanese banks has agreed to provide a loan facility of $1bn (£640m) to Sierra Gorda SCM to finance the Sierra Gorda Copper mine project in Chile.

The syndicate consists of Japan Bank for International Cooperation, Mizuho Corporate Bank, Sumitomo Mitsui Banking Corporation, The Bank of Tokyo-Mitsubishi UFJ and The Sumitomo Trust & Banking.

Sierra Gorda, a company held by Sumitomo Metal Mining, Sumitomo Corporation and Quadra FNX Mining, was advised by Sullivan & Cromwell, fielding New York partners Sergio Galvis and Christine Spillane and Tokyo partner Garth Bray. The banks were advised by Milbank Tweed Hadley & McCloy, with New York partners Jonathan Green and Richard Brach leading the team.