Raft of firms land roles as Chinese mining companies snap up international assets

A number of Australian and Canadian law firms have been called in to act on two Chinese mining companies’ recent overseas acquisitions ­- Hanlong Mining’s A$1.65bn bid for Perth-based Sundance Resources and China Minmetals’ A$1.3bn takeover of Montreal-based Anvil.

In Sichuan Hanlong Mining’s bid to acquire Australia Stock Exchange (ASX)-listed iron ore miner Sundance Resources, Mallesons Stephen Jaques is acting for the bidder, while Clayton Utz is the advisor to the target company. The Mallesons team is led by Sydney partner David Friedlander and the Clayton Utz team is headed by Perth partner Mark Paganin.

It is Hanlong’s second offer to Sundance. Its original offer in July of A$0.50 per share, which is A$0.07 lower than the current one, was rejected by the target company.

Hanlong, however, will have to hire strong white-collar-crime lawyers for defense, as two of its senior executives and an employee are being investigated by the Australian Securities & Investments Commission for alleged insider trading activities, according to The Australian.

A week before Hanlong Mining’s sweetened deal, Hong Kong-listed Minmetals Resources agreed to buy Toronto and Australia dual-listed copper miner Anvil Mining for A$1.3bn. Through the deal, Minmetals will acquire three copper mines in Africa.

Minmetals’ external legal counsel include Freehills in Australia, Davies Ward Phillips & Vineberg in Canada, Linklaters in Hong Kong and Paris and Kalamba & Associes in Democratic Republic of Congo. Clayton Utz and Canadian firm Lawson Lundell are advising Anvil Mining. Canadian firms Cassels Brock & Blackwell and Stikeman Elliott are representing Anvil’s independent directors and the company’s largest shareholder Trafigura Beheer respectively.

The value of resources deals by Chinese companies since the beginning of the year has reached $18.5bn, compared with $20.8bn for the whole of 2010, according to Bloomberg.

The strong resources deal flow driven by Chinese acquirers has fuelled several global law firms’ further expansion in Canada and Australia. However, a China-based partner from a leading Canadian firm told The Lawyerthat compared to global law firms, leading independent firms in Canada and other jurisdictions still enjoy a considerable part of the market share.

“There’s no question that global law firms have some advantage in vying for certain types of work, in particular transactions with many very complex issues in each of a number of jurisdictions where the global firm has a strong presence. These are the higher profile and seemingly more glamorous transactions, but still the minority,” he said. “Most cross-border transactions which we see coming into or going out of China are still those involving two principal jurisdictions and perhaps one other with less onerous demands.  At the end of the day, the client wants a law firm which it knows and can trust to make sure that things are done right, regardless of how international or global it might be.”