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Dentons Rattagan Arocena advised the Mobivia group in the sale of 100% of the shares of its Argentine subsidiary Norauto Argentina SA to the Stellantis Group. The sale is scheduled to be carried out in two tranches, with 90% of the shares being transferred in July 2023 and the remaining 10% within one year from initial closing.

They aim to ensure a smooth process for all parties involved to guarantee stability for customers and firms alike.

Norauto Argentina SA is a leading company in automotive maintenance and specialises in sales of tires, car accessory parts and services to vehicles. Norauto was founded in France in 1970 and has since expanded internationally as part of the Mobivia Group.

Mobivia is a French company with presence in 11 countries,  committed to sustainable mobility and has been working with users since its inception creating mobility solutions and local support. They resource options for carbon-free, healthy, and safe mobility that can be accessible to all.

Stellantis is a leading multinational automobile group comprising 14 automotive brands and two mobility arms. It possesses industrial operations in more than 30 countries and sells to customers worldwide.

Dentons Rattagan Arocena, through a team led by partner Roberto P. Bauzá, provided legal advice to Mobivia in corporate, contract negotiation, labor and tax matters, among other aspects of the transaction.

 

 

Gerald Edelman, Chartered Accountants and Business Advisers, advised Lucena Capital in the strategic acquisition of Impress Group, a company established in 1997 with operational sites in Blaydon and Washington. The firm is known for tackling intricate client challenges throughout the North East region and further afield.

Jason Young has ascended to the role of managing director, succeeding the retiring directors George Peel, Steven Young, and David Haley. With a tenure of 23 years at Impress, Jason Young steps up with the backing of Ben Suquet, the driving force behind Lucena Capital. Suquet’s investment in Impress marks a collaborative effort with Young to chart the company’s progressive course.

The announcement of the deal was marked by Jason Young's declaration of entering a thrilling era for Impress. Plans are underway to funnel substantial investments to enhance the company’s offerings. Young spotlighted potential growth sectors and the intent to leverage emerging technologies in precision engineering to keep Impress at the industry vanguard.

 

Could you provide an overview of the strategic approach Gerald Edelman took when advising Lucena Capital on the MBO of Impress Group?

What were the most significant challenges faced during the MBO process, and how did your team work to overcome them?

How did Gerald Edelman ensure that the advice provided aligned with both the short-term and long-term objectives of Lucena Capital in the acquisition of Impress Group?

Can you discuss any innovative financial structures or strategies that Gerald Edelman employed to facilitate this MBO?

 

Post-MBO, what role does Gerald Edelman play in the ongoing relationship with Lucena Capital and Impress Group, and how do you support the newly formed entity in achieving its business goals?

 

Hughes Hubbard & Reed LLP, a leading international law firm, has successfully represented JOST Werke SE, a global leader in the manufacturing of smart systems for commercial vehicles, in its recent acquisition of Crenlo do Brasil. The firm acted as the primary legal advisor, leveraging its extensive expertise to navigate the complexities of this international transaction.

Gerold Niggemann spearheaded the Hughes Hubbard M&A team, bringing to the table his rich experience and strategic insights. His leadership was crucial in coordinating a multidisciplinary team comprising specialists across various legal domains—antitrust, tax, employment and benefits, real estate, compliance, and intellectual property—ensuring a seamless transaction flow.

The firm's global reach and collaborative spirit were further amplified by the involvement of local counsel, with Santos Neto providing essential Brazilian due diligence insights and Nauta Dutilh offering advice on Dutch law matters.

This transaction stands out in the Brazilian M&A market for its pioneering use of representations and warranties insurance—a testament to Hughes Hubbard's innovative approach to managing potential risks and liabilities in M&A deals.

With Hughes Hubbard’s comprehensive legal support, JOST Werke SE is well-positioned to capitalize on its expanded presence in Brazil, aligning with the company’s strategic growth objectives in South America and reinforcing its commitment to delivering excellence in the commercial vehicle industry.

 

American National Group is a multi-line group of insurance companies, and Brookfield Reinsurance looks to own, operate, and build on the long-standing stability and success of the American National Group. The American National Group acquisition was part of a broader industry trend of acquisitions of insurers that coincide with insurance companies expanding interest in private credit assets to provide better returns amid record-low interest rates. Other firms to acquire significant insurance assets at the time included Blackstone Group, Apollo Global Management, and KKR & Co.

In 2023, Brookfield Reinsurance has continued its acquisition strategy. In February, it announced that it would acquire the U.S. commercial speciality lines platform of Argo International Holdings, a provider of property and casualty insurance products, in an all-cash transaction valued at approximately $1.1 billion. Then, in July, Brookfield Reinsurance announced an agreement to buy American Equity Life Insurance Company (NYSE: AEL). That deal, a cash and stock transaction that valued AEL at approximately $4.3 billion, followed Brookfield’s initial partnership with AEL in which it agreed to reinsure up to $10 billion of fixed index annuity liabilities and made a 19.9% equity investment in the company in October 2022. 

This scope of mergers and acquisitions activity reflects efforts by Brookfield Reinsurance to expand its insurance business in an economic climate that has changed since it acquired American National Insurance in mid-2022. Since that time, the Federal Reserve has raised interest rates 11 times to combat rising inflation. Brookfield Reinsurance will own and operate insurance companies for decades into the future

Nevertheless, M&A activity in the insurance industry has remained resilient ​​despite macroeconomic changes since mid-2022. According to a PwC report, during the six months from mid-November 2022 to mid-May 2023, a total of 194 insurance industry M&A transactions were disclosed, accounting for more than $7 billion. This contrasts with the earlier six-month span from mid-May to mid-November 2022, which saw 263 disclosed transactions with a combined deal value of $2 billion.

Acquisitions pursued by Brookfield Reinsurance fall in line with this trend. 

Terms of the Deals

The deal with Argo was seen as a noteworthy step toward broadening Brookfield Reinsurance’s offerings, with Argo's U.S. commercial speciality lines platform seen as a complementary addition to American National Group’s existing casualty market participation.

As part of the agreement, each issued and outstanding Argo common share was converted into the right to receive $30 in cash at the merger's closing, which Brookfield funded with existing cash on hand. This per-share price offered a 6.7% premium to Argo’s closing share price on the day before the merger, Feb. 7, 2023.

The acquisition of AEL targeted its fixed annuity business, one of the largest in the industry.

“Given the complementary nature of AEL’s leading fixed annuity business to our existing platform, we expect to accelerate growth in collaboration with our distribution partners and employees while continuing to meet the needs of our policyholders and other stakeholders,” said Jon Bayer, managing partner at Brookfield Reinsurance, in a statement when the deal was announced. “Under its current leadership, AEL has been transformed into an innovative, asset-light insurer that is positioned for growth, and we look forward to building on our successful partnership.” 

Under the terms of the deal, AEL shareholders will receive $55 per share, with a mix of cash and Brookfield Asset Management Ltd. class A limited voting shares, valuing AEL at a 35% premium compared to AEL’s closing share price before the deal.

Post-acquisition, AEL's headquarters will remain in Des Moines, Iowa. Brookfield Reinsurance also plans to maintain AEL's charitable contributions and focus on alternative asset strategies, with a considerable portion of AEL’s assets expected to be managed by Brookfield Asset Management Ltd. The transaction is slated for closure in the first half of 2024.

M&A Opportunities in an Uncertain Economy

Brookfield made this investment in the casualty insurance market and annuities amid a broader downturn in M&A activity and a more uncertain macroeconomic environment. And it’s not the only large firm to make these kinds of investments. Nevertheless, other recent acquisitions include Stone Point Capital LLC’s 20% acquisition of Truist Insurance Holdings Inc. for $1.95 billion and RenaissanceRe Holdings’ $3 billion acquisition of American International Group Inc.’s treaty reinsurance business.

The insurance M&A sector has been resilient largely because, despite rising rates and inflation, stable assets like casualty insurance and fixed annuity writers are attractive investments for acquiring firms with the capacity to invest patiently and to operate insurance companies that serve the interests of policyholders.

Casualty businesses generate consistent revenue through premium collections from policyholders, irrespective of the economic environment. In times of economic turbulence, the predictable revenue from premiums can provide a financial cushion, making casualty insurance platforms targets for diversification and long-term investment.

According to Brookfield’s most recent letter to investors, the company’s insurance investments seem to be following this playbook, paying off despite high interest and inflation.

“During the quarter, our average investment portfolio yield increased to 5.4% on approximately $45 billion of assets, about 220 bps higher than the average cost of capital,” reads the letter. “We continue to see a path to annualized earnings from this business of $800 million by the end of 2023 and, given tight credit markets, this puts us in an enviable position.”

Public Sentiment Has Power:

Why Social Media Analytics is an Essential Component of Due Diligence

Lisa Dane - Vice President, Charles River Associates

In the era of ESG and socially responsible investing, the ubiquity and virality of social media holds sway over businesses. Simply being profitable is no longer good enough, profitability must be achieved in a way that the general public agrees with. On paper, the financials of a target company could be impressive, the backgrounds of key executives could be squeaky clean. But before you breathe a sigh of relief and follow through with the investment, you must examine the most “public” of all public records—social media.

 

One controversial post, regardless of intent or accuracy, can circle the globe in an instant, and profoundly affect the business and its leadership.

 

The sheer volume of social media posts on countless topics and platforms makes analysing that sphere in a due diligence context a daunting prospect. However, sophisticated social media analytics tools allow for targeted research; information can be efficiently gathered across multiple social media platforms to identify and measure what people are saying about a company or its management, who is saying it, and how it resonates.

 

Robust due diligence in an M&A transaction should encompass a two-pronged approach to social media that focuses on what is being said about a business entity and its management, as well what the business and management are posting themselves.

 

Understanding the target company from the public’s point of view

Tools allow us to conduct “topic queries”. Those queries can be as simple as the name of the target company for any mentions of the entity or can include key words that allow the analyst to zoom in on commentary relating to a particular issue using terms such as “mismanagement” or “scam” or “accounting scandal”. The output includes graphics (see sample below), that reveal the total volume of the conversation over a period of time and on what platforms the conversation is happening (e.g., Twitter or Reddit).

 

 

The results can also be visualised by sentiment based on positive, negative or neutral coding.

 

As seen in the graph above, the software can show spikes in the conversation, which is a stark reminder of how quickly commentary can go viral. The next step is to investigate who is commenting: is it a competitor, a former employee with a grudge, a short seller, an environmental activist? Understanding the drivers of the conversation, and who is driving them can help investors refine their investment thesis and strategy.

 

Understanding the executives

As we all know, businesses are the people who run them. The social media aspect of due diligence gets you closer to understanding what makes the people of a particular company tick. It’s a window into what they believe, what they feel, and who and what is important to them.

 

In addition to conducting topic queries on the target company’s management to learn what the public may be saying about them, it’s necessary to determine whether the individuals themselves are posting content that may be relevant to your decision-making.

 

In the current global political and social environment, the public is on perpetual high alert. So, the CEO posting about a hunting vacation with friends, or the VP who endorses a politician known to have posted disparaging racial remarks can spark a social media frenzy that can alter a company’s value within days. It doesn’t matter at that point how great the target company’s product is if the public has decided they don’t want to buy “x” from someone who thinks “y.”

 

The other aspect of an executive’s social media profile that may prove relevant is who they are connected to. An executive’s connections may include people who are cause for consideration such as government officials or people at a competitor firm. Some connections could be more problematic: for example, the executive may be tied to individuals or groups espousing controversial views. Although the executive may not hold the same beliefs, the “guilty by association” factor comes into play. If a clever journalist could uncover the same connection, your prospective investment may be in peril.

 

Investors have a duty to their clients to ensure that their due diligence is as thorough as possible. More information is always better than less, especially if there is a simplified way to gather and measure it using analytical tools. Unlike financial or other company records, social media can be thought of as an evolving “record” of information which can drive sentiment in one direction, or another, affecting a company’s reputation and, in turn, its financial performance. Unlike traditional media, social media doesn’t have to be accurate or even remotely grounded in reality, but that public sentiment has power. It moves money.

 

While it is unlikely that an investment decision will ever hinge entirely on social media posts by or about an executive or the target company, using tools to efficiently distil meaningful intelligence from voluminous social data can complement and bolster traditional due diligence methods. Most importantly, it can give you a higher degree of confidence in the success of your investments.

 

Lisa Dane is Vice President with Charles River Associates. The views expressed herein are the views and opinions of the author and do not reflect or represent the views of Charles River Associates or any of the organizations with which the author is affiliated.

 

 

 

Passenger Secures a £15M Investment from Growth Partner

About the Deal

DWF provided legal advice to Growth Partner on its £15 million investment in clothing brand Passenger.

Founded in 2012 by Richard and Alexa Sutcliffe, Passenger is a rapidly-growing outdoor clothing brand with a focus on sustainability. Passenger plants a tree for every order it receives and ensures that over 90% of its product portfolio is made with lower-impact materials such as hemp, organic cotton, and recycled cotton and polyester. The firm is set to achieve revenue of £50 million in 2023.

Consumer-specialist investment firm Growth Partner is taking a significant minority stake in Passenger as part of its domestic and international growth strategy. Former Gymshark chief executive Steve Hewitt, who is investing alongside Growth Partner, will become chairman of Passenger, while Growth Partner investment director James Worrall will join the board as non-executive director. Whanau Advisory, a firm founded by Steve Hewitt and including a number of former Gymshark executives, will become a strategic advisor to Passenger.

DWF advised Growth Partner with a team led by partner Will Munday and senior associate Francesca Kinsella.

 

An Interview With Will Munday from DWF

Can you tell us more about the role that your team played during this investment?

 

I have worked with James Worrall for many years, but this was our first instruction from Growth Partner. Our market-leading regional corporate team has deep-rooted venture capital and retail sector expertise, so the chance to assist Growth Partner with its investment in Passenger was a particularly exciting opportunity that played to our strengths.

 

We got involved at the heads of terms stage and assisted Growth Partner in preparing the key legal terms included in the initial offer letter. Once the heads of terms were agreed, we carried out a focused legal due diligence exercise on the specific areas of concern for Growth Partner. As would be expected, ESG was a key area of our due diligence review and our specialist regulatory team, led by partner Dominic Watkins, added real value here. Next, we prepared and negotiated the key transaction documents – sale and purchase agreement, shareholders’ agreement and new articles of association – as well as the various ancillary corporate documents.

 

Deal management was of particular importance on this transaction as there was a challenging timetable and the team had to negotiate with Passenger’s advisers and advisers for the co-investor, Whanau Advisory. Francesca, the senior associate on the deal, should be singled out for particular praise as she managed an extremely efficient process that involved negotiating with multiple parties at any one time.

 

What unique skills and experience did you bring to bear as part of your work on this transaction?

 

DWF’s corporate team has a particular specialism in private equity and venture capital investments. With a team of over 30 lawyers in the North, we are recognised for our skill in combining legal expertise within the PE market with a distinctively energetic, decisive and clear approach. This market knowledge was vital in the smooth running of the transaction and enabled us to deliver commercial and pragmatic advice to Growth Partner in order to achieve a successful and timely completion.

 

We use technology to make the administrative and burdensome elements of transactions simpler and more efficient. A good example is our bespoke platform ‘DWF Diligence’ that we have developed to help streamline and manage the due diligence process. On the Passenger transaction it was of great value in light of the challenging timetable as it ensured the legal due diligence was carefully scoped, planned and executed. It allowed multiple users, including lawyers from various other practice areas, to access and update the legal due diligence report at the same time. Further, we were able to use real time reporting to present up-to-date progress and key information to Growth Partner in visualisations which allowed us to resolve identified issues quickly.

 

How did you work with your clients and other involved counsel to ensure a satisfactory outcome for all involved?

 

In our view, clients choose legal advisers based on ‘feel’ and ‘chemistry’. They want to know that their legal advisers will fight for their best interests, be a dedicated resource which is available when needed and engage with them in a straightforward and yet professional manner. This was our approach with Growth Partner and the team was able to develop a strong working relationship with James very quickly through regular communication at all levels.

 

As this was a significant investment for Growth Partner, albeit a minority stake, there was particular focus on negotiating the appropriate investor protections. This led to some suitably robust negotiations, but we were able to work together effectively with lawyers for Passenger (Osborne Clarke) and Whanau Advisory (Gateley Legal) to agree the key transaction documents and ensure Growth Partner’s interests as an investor were appropriately protected.

 

 

Quercus Corporate Finance advised the shareholders of Future Industrial Services (FIS) on the sale of the company to waste and resource management group, Augean.

FIS is a Liverpool-headquartered provider of hazardous waste management and specialist industrial services with branches in Rugby, Hull, Plymouth, Honiton and Berwick. The firm’s client base includes government bodies, major utilities and national and multinational corporations, and its operations extend across five waste processing, treatment and recovery sites – among them the UK’s only mercury recovery facility.

Acquired by Ancala Partners and Fiera Infrastructure in October 2021 in a £390 million deal, Augean is a Wetherby-based group that boasts 23 sites across England, Wales and Scotland. FIS chief executive David Lusher lauded the combination of the two companies in a statement. “I am incredibly proud of the FIS team and their clear focus on making us a better business for our customers, investors, employees and the environment,” he said. "It is important that the company we have built up together continues to flourish and grow. That ambition has culminated in becoming part of the Augean Group today."

Quercus Corporate Finance advised the FIS shareholders with a team led by partner Mark Whelan and associate partner Neil Giles.

An Interview with Mark Whelan at Quercus Corporate Finance

Please give us some background into this transaction and the role that your team played.

Quercus acted as joint M&A advisers to FIS and NorthEdge, alongside EY Manchester, on the sale of the company to Augean. This involved preparing the business for sale, identifying and engaging with buyers and negotiating an agreed deal.

I had a prior relationship with David Lusher and Colin Stirling, FIS CEO and Chairman respectively, for a number of years and helped David to put together the MBO when David and NorthEdge acquired the business in 2017, so it was a real pleasure to have the opportunity to work with them again. Conversely, this was our first sale for NorthEdge and I am extremely grateful to Andy Ball and John Hammond for trusting us with this important exit.

What unique skills and professional experience did you draw upon as part of your involvement in this transaction?

Our philosophy at Quercus is to develop deep, proprietary knowledge in our chosen sectors, and our demonstrable experience in and around the circular economy was very important on this transaction. It meant that we understood precisely where FIS sits in the waste value chain and hence, we could best position the business in the market.

Our strong relationships with all the industry players at a senior level were also extremely valuable in approaching and engaging with potential buyers.

When advising on sales of this nature, what are the key considerations that you take into account?

Firstly, we only take on mandates where we think we can add value and deliver a successful outcome. As an independent owner-managed business, Quercus does not operate a portfolio business model, so deal completions are very important to us!

Every sale throws up different challenges, but the key consideration is always the client’s objectives.  Many naturally want to maximise value whilst others are looking for a good home for a lifetime’s work. Ultimately, we want to create options for our clients and in our experience that is only possible on the back of high-quality preparation, so that is a big area of focus for us.

Did you encounter any significant challenges during the course of this transaction? How did you overcome them?

FIS is an exciting and fast-growing business, built on both acquisitive and organic growth initiatives. Our preparation for a sale coincided with a particularly strong period of organic growth, with some important new customer wins along with recovery from the effects of the COVID-19 pandemic. In addition, FIS continued its track record of strategic acquisitions with a highly complementary bolt-on to the Honiton business mid-way through the process. As a result, we had to carefully analyse and then articulate that growth and future upside to potential buyers to ensure that their valuations of the business properly captured that growth, rather than looking backward at historic results. We believe that we achieved this and got the buyers to focus on the right value drivers.

In what ways would you say that your work as a part of this deal fits the profile of your firm?

The sale of FIS is a very good example of the type of work Quercus targets as a firm. We are sell-side specialists with significant buy-side and capital raising expertise. We also have a particular specialism in the waste and recycling sector built on my 30 years of working in and as advisor to that sector. Our value proposition is very much built around our experience, expertise and international reach, and all three were very important on this transaction, especially our deep waste sector knowledge and our relationships with the key industry players.

What impact do you expect this deal to have on Augean and FIS, or on the UK waste management sector more broadly?

The coming together of both businesses will undoubtedly benefit both FIS and Augean and their respective employees as the strategic fit is strong, with plenty of opportunity to leverage each party’s strengths. More broadly, the deal is undoubtedly an important sector milestone because it demonstrates the important role that mid-market private equity investors like NorthEdge can play in helping to shape and develop the sector.

The deal has generated a lot of enquiries for Quercus from other waste operators looking to realise value and I am confident that the sector will remain busy. If you will forgive the pun, the Future is bright.

SiPearl’s €90 Million Serie A Fundraising

 

About the Deal

act Aston Avocats advised French microprocessor manufacturer SiPearl on the first round of its Series A funding.

 

Founded in 2019, SiPearl specialises in the development of energy-efficient high-performance computing (HPC) microprocessors. The firm has successfully raised €90 million in this first round of its Series A funding. Participants in the funding round included semiconductor design and silicon IP firm Arm and data and security specialist Atos Group through its Eviden business. The European Innovation Council (EIC) Fund and French Tech Souveraineté also contributed to the funding, which included up to €25 million of convertible debt from the European Investment Bank (EIB).

 

SiPearl will use the newly raised funds to bring Rhea, its first product, to market in early 2024. Rhea is an HPC-dedicated microprocessor designed to integrate with any third-party accelerator, such as GPUs, quantum processors and AI. Rhea’s energy-efficient data processing power is designed to address obstacles in research, security, energy management and many other fields. Funds will also be used to expand SiPearl’s R&D and production capabilities while scaling up its commercial operations, with more investors expected to join the funding round in 2023.

 

act Aston Avocats advised SiPearl with a team comprising associates Olivier Sanviti and Mariam Tourabaly. Orrick Herrington & Sutcliffe LLP also advised SiPearl, while EIC, EIB, Arm and Atos Group were advised by Bignon Lebray, Clifford Chance, Bird & Bird and Darrois Villey Maillot Brochier respectively. French Tech Souveraineté was advised by Degroux Brugère & Associés.

Graf Patsch Taucher Rechtsanwälte GmbH advised French consulting company Efeso on its acquisition of a majority stake in Tsetinis Consulting, a firm wholly owned by German auto parts supplier ZF Friedrichshafen. Bird & Bird also advised Efeso, while KPMG Law advised ZF Friedrichshafen.

Efeso has acquired a majority stake in Tsetinis with a view to gradually taking over the company’s entire share capital in the coming years, during which time the companies will continue their cooperation. With the acquisition of the majority stake, Efeso has bolstered itself with more than 120 new consultants based in Kuchl in the Salzburg region, further entrenching its position in Austria’s consulting market. Founded in 2000, Tsetinis specialises in all aspects of business transformation in the auto industry, including process and cost optimisation.

Efeso is a Paris-headquartered multinational organisation that specialises in industrial operations strategy and performance improvement consultancy. The group assists its clients on the optimisation and strategic alignment of industrial operations. Prior to this most recent acquisition, Efeso employed 800 people across 35 global sites.

ZF Friedrichshafen, the prior owner of Tsetinis, is one of the largest automotive suppliers in the world, present in 168 production sites across 32 countries. The group also operates in 18 main development locations across eight countries.

An Interview With Bernd Taucher

From Graf Patsch Taucher Rechtsanwälte GmbH

Can you tell us more about your involvement in this acquisition?

I have known Stefan Münch from Bird & Bird in Munich for quite a while, but we never had the opportunity to work together
on a larger M&A transaction so far, Efeso has been a client of Bird & Bird France’s partner Bertrand Levy, who introduced the German Bird & Bird Corporate Practice to Efeso. Since Tsetinis Consulting is a company incorporated in Austria with a German and a US subsidiary, an Austrian counsel was required for the transaction, and so we teamed up to successfully run this together.

What specialised skills and experience did you and your colleagues draw upon as part of your work?

I am an M&A, private equity and corporate finance lawyer, originally trained for years in one of the largest leading Austrian corporate law firms. Graf Patsch Taucher has the market now as a boutique firm for nearly 20 years and I believe we have a particularly strong track record for international corporate and transactional matters. To name a few, our clients include the premium sporting goods producer HEAD, SIMMO AG, the Canadian Canopy Growth, the Luxembourg APS Group, the Emeren Group (before: Renesola) the Swiss Health & Nutrition AG and the petrochemistry champion Borealis., We advised all of them in corporate finance and/or M&A projects in the past and ongoing.

We are also quite strong in the start-up sector assisting FL3XX and the large Austrian automotive consulting firm EFS Consulting on convertible loans and private equity or M&A transactions. We work in very lean teams, which means that I know of every step that is taken in a transaction, which our clients prefer since there is no need for alignment – as is the case with larger teams working on a transaction. With my nearly 30 years of international transaction experience, I certainly know what it needs to get a deal done and dusted.

What are the most important factors to keep in mind when advising on an acquisition of this nature?

In my view, two things are crucial. Firstly, it is all about communication. Good lawyers solve problems, whereas excellent lawyers ask the right questions before they solve anything. This means that prior to working on a transaction, we are eager to fully understand the structure proposed for the project. We may get involved at a point of time where clients have already signed a letter of intent with a certain structure in place. By asking the right questions, we try to quickly understand our clients’ and the transactions’ needs, which may require a change to the originally proposed structure. Excellent communication in all directions is a must, including all parties involved who promote a deal, such as advisors, financing banks or funds.

Once we have agreed on a structure with our client, we look to get the other side of the transaction on board. To this end, we  try to understand the other party’s interests and whether we can argue a revised structure also to their benefit. M&A projects always include parties with different interests; however, we obviously aim to get the best solution for our clients which in parallel should also be the best solution for the counterparty on the deal. We are tough on the issue but gentle in our communication with the counterparty and their advisors. At the end of the day, we want to bring about a successful deal together.

With this in mind, it is absolutely crucial to develop a perfect understanding of the counterparty and its positions and also the positions of any other advisors or stakeholders in a transaction. And this is exactly how I try to run a project at Graf Patsch Taucher.

Did you encounter any challenges as part of this work? If so, how did you overcome them?

Well, every transaction has its challenges. In the Efeso/Tsetinis deal it certainly was the timing. The timeline proposed by the parties was extremely tight and there were also other bidders in the race.  We had to carry out a very quick and very focused but still thorough due diligence, while working in parallel on the share purchase agreement, the shareholders’ agreement, new articles of association and other ancillary documentation, including corporate documentation and documents for the public registers, POAs, etc. How did we overcome this? Simply by working night and day with high speed, high motivation and high concentration. Nothing else would have worked in this case.

In what ways would you say that your work on this acquisition fits the profile of your firm?

The Efeso/Tsetinis transaction perfectly fits our firm’s profile. Over 70% of my corporate work is international. In the Efeso/Tsetinis transaction we were working with the German and French offices of Bird & Bird, our client was headquartered in Paris and we were supported and guided by Efeso’s leading people based in Belgium, the Netherlands, Germany and the US.

Do you have any further comments to make about this transaction?

Let me say that I am very grateful and humble that I had the opportunity to work with so many not only wonderful but also professionally experienced and organised people – both alongside Efeso and its shareholder EURAZEO and also on the side of the seller, ZF Friedrichshafen AG. It was a great pleasure and honour working on  this transaction.

This decision follows the unconditional clearance by the European Commission of all other EEA countries and referral back to the ADLC for France.

The deal involved overlaps in the wholesale and retail distribution of pharmaceutical goods in several European countries. The ADLC considered both local markets and a national market taking into account the buyer power of the Pharmaceutical Purchasing Groups which mainly operate at national level. CRA played a pivotal role in showing the role of PPGs and the increasing competitive constraints from players evolving outside the defined market, convincing the ADLC to accept the proposed behavioural remedies.

A CRA team including Laurent Flochel, Romain Bizet, and Sylvestre Boittin Duchesne advised both Parties for the European Commission and the ADLC proceedings.

Q&A with Laurent Flochel

Vice President at Charles River Associates

Tell us more about your involvement in the acquisition.

We have assisted both Parties since the beginning of the project. We have worked extensively to gather the relevant data for each Party and carried out all competitive analysis in the prenotification and then during the notification phase. We have also helped the legal teams with the design of potential remedies.

During the prenotification phase, we assisted the Parties to answer to the numerous questionnaires issued by the European Commission, which has been a very heavy task. The Commission cleared the case in Italy and referred back to the French Competition Authority (ADLC) for the analysis of the French market. We then assisted the Parties in this new phase.

What were some of the challenges you were faced with?

In this market, the competitive interactions between the wholesalers and their clients take place at two levels: at a national or multiregional level with the pharma purchasing groups and at a local level with the pharmacies. The Commission and the ADLC carried out their competitive analysis both at the level of the catchment area of each depot and at the multiregional or national level.

How did you resolve them?

We managed to convince the ADLC that the competitive pressure exerted by the purchasing groups is very important and that the competitive analysis should not be limited to the local level (i.e. at the level of the catchment areas). In this market very precise and granular data are available. It allowed us to calculate very accurate market shares in value at different levels.

What have been some of the key trends you’ve seen in the M&A space this year?

The last two years have been very intense in the M&A activity and there is a clear trend for the various competition authorities to a stricter merger control on both sides of the Atlantic. The CMA in the UK is today probably the toughest agency.

Greenberg Traurig advised Altán Redes, S.A.P.I. de C.V. with a team including Juan Manuel González Olguín, Rodrigo Orozco Waters, Miguel Flores Bernés, Edgar Olvera Jiménez, Maribel Tovar Frías, José Abel Rivera-Pedroza and Natalia Mejía.

Del Castillo y Castro Abogados advised Altán Redes, S.A.P.I. de C.V. with a team including Fernando Del Castillo, Linda García de Alba, Karla Silva, Maricruz Cervera and Gabriela Ríos.

Creel, García-Cuéllar, Aiza y Enríquez, S.C. advised Altán Redes, S.A.P.I. de C.V. with a team including Iker Arriola, Edgar Ancona and Ana Lucía Quintanilla.

White & Case also advised Altán Redes, S.A.P.I. de C.V. on the deal.

Curtis, Mallet-Prevost, Colt & Mosle advised Banco Nacional de Obras y Servicios Públicos, Nacional Financiera and Banco Nacional de Comercio Exterior with a team including Rodrigo Valverde Sánchez, Irene Cuéllar, Mario Gutiérrez, Raúl Archundia and Andrés Hernández Romo.

Kelley & Ortiz S.C. also advised and represent directly in the judicial procedure and restructuring proceess negotiating the terms of the agreement, Banco Nacional de Obras y Servicios Públicos, Nacional Financiera and Banco Nacional de Comercio Exterior advised through their partner Santiago Kelley Pérez de la Vega, and other lawyers form the legal firm, including José Enrique Sánchez Torres .

FunBox is an amusement arcade business that recently opened an outlet at Gravity Wandsworth in London and has another location scheduled to open in Liverpool later this year, with a third location reportedly in the works for London’s Westfield Stratford shopping centre. Its acquisition by Urban Fun spanned three jurisdictions across the UK, US and Germany.

A holding company established by Sega Amusements International CEO Paul Williams, Urban Fun will retain FunBox founders Albert Corrigan and MatthewDeith on its leadership board following the acquisition. Paul Williams will remain CEO of Urban Fun, with Matthew Deith becoming managing director and Albert Corrigan becoming operations director.

In addition to the services provided to FunBox Gmbh by Werner, Luger & Partner, global law firm Taylor Vinters advised sister company FunBox UK, while Menn Law Firm Ltd advised US software company Garner Green on the sale of intellectual property rights. Menzies advised the buyer.

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