A landmark of American capitalism is set to change hands again and a cadre of Am Law 100 lawyers couldn’t be happier about the potential bonanza in legal fees the deal could generate.
Sullivan & Cromwell, Shearman & Sterling, and Wachtell, Lipton, Rosen & Katz are among the firms advising on the proposed $8.2 billion cash-and-stock sale of NYSE Euronext—parent company of the New York Stock Exchange—to the Atlanta-based IntercontinentalExchange (ICE).
The deal, which was announced this past Thursday, comes a year after NYSE Euronext agreed to merge with Germany’s Deutsche Börse in a $10 billion all-stock deal that ultimately crumbled in the face of scrutiny by European antitrust regulators.
As retired Skadden, Arps, Slate, Meagher & Flom corporate partner Ronald Barusch said in a column for The Wall Street Journal last year before that proposal collapsed, such cross-border exchange mergers often require teams of lawyers performing labor-intensive corporate, antitrust, regulatory, tax and litigation work. The latest deal is no exception.
Wachtell, Cleary Gottlieb Steen & Hamilton, Linklaters, and Dutch firm Stibbe, all of which advised on the $20 billion merger that created NYSE Euronext in 2006, took the lead for the combined entity on its ill-fated merger with the Deutsche Börse.
Wachtell and S&C—which both have roles on the proposed $1.4 billion merger between high-speed trading shops Getco and Knight Capital announced this past Wednesday—again are deploying deal teams for the potential tie-up between NYSE Euronext and ICE.
S&C is advising ICE on its bid for NYSE Euronext, with M&A partners John Evangelakos and Audra Cohen taking the lead from the firm. Other S&C lawyers working on the deal include chairman emeritus H. Rodgin Cohen, financial institutions partner David Gilberg, M&A partners Tim Emmerson and Olivier de Vilmorin, tax partners David Spitzer, Michael McGowan, and Nicolas de Boynes, executive compensation partner Matthew Friestedt, antitrust partner Steven Holley, securities partner Catherine Clarkin, employee benefits special counsel Lawrence Pasini and Henrik Patel, and tax special counsel David Passey.
S&C previously represented ICE when it entered the credit derivatives market with the 2008 acquisition of Creditex for $625 million. Cohen and Evangelakos also led an S&C team that advised ICE last year on a joint $11.3 billion bid with Nasdaq—the world’s second-largest stock exchange—to acquire NYSE Euronext in the wake of its announced deal with Deutsche Börse.
Earlier bid withrawn
ICE and Nasdaq withdrew that bid in May 2011 after the Justice Department indicated it would move to block any potential deal on antitrust grounds.
Shearman M&A partner John Marzulli Jr., led a team from the firm counseling New York-based Nasdaq on its aborted bid for NYSE Euronext, according to our previous reports. (Marzulli also led a group of Shearman attorneys advising Nasdaq on last week’s $390 million purchase of Thomson Reuters’s corporate services division.)
After acting as corporate counsel for Nasdaq, Shearman has assumed the role of European regulatory and antitrust counsel to ICE on its latest bid for NYSE Euronext. Lead lawyers from the firm working on the matter include financial institutions regulatory partner Barney Reynolds and counsel Azad Ali, antitrust partner Matthew Readings, tax partner Iain Scoon, and employee benefits counsel Sam Whitaker.
ICE is a longtime Shearman client, with the firm counseling the exchange on its purchase of The Clearing Corporation for an undisclosed sum, its subsequent $600 million acquisition of the Climate Exchange, its $512 million acquisition of a 12.4 percent stake in Brazilian clearing firm Cetip, and its purchase of a 79.12 percent stake in the derivatives and spot natural gas business of APX-Endex for an undisclosed sum.
The legal teams
Johnathan Short, a former McKenna Long & Aldridge partner, serves as general counsel and corporate secretary for ICE.
The legal team advising NYSE Euronext on its proposed sale to ICE is being led by Wachtell M&A partner David Karp and antitrust partner David Schwartz.
Wachtell served as NYSE Euronext’s lead legal adviser last on the proposed merger with the Deutsche Börse. Though antitrust concerns helped kill that deal, similar issues may not play as prominent a role in the proposed union of NYSE Euronext and ICE because there is little overlap between the two exchanges, according to news reports.
Reuters reports that, if the proposed merger wins regulatory approval, it will create the world’s third-largest exchange, with a combined ICE-NYSE Euronext able to offer a derivatives and equity exchange platform.
Magic Circle firm Slaughter and May is advising NYSE Euronext through antitrust partner Claire Jeffs and corporate head Frances Murphy. Jaap Willeumier, head of banking and finance at Stibbe, is providing counsel on Dutch legal aspects of the proposed merger.
Former Milbank, Tweed, Hadley & McCloy associate and current NYSE Euronext deputy general counsel Tracey Heaton is leading an in-house team from the exchange working on its proposed sale to ICE.
Davis Polk & Wardwell corporate partner John Amorosi is representing Morgan Stanley, which is serving as financial adviser to ICE in connection with its bid for NYSE Euronext.
Brian Baxter writes for Am Law Daily, a Daily Report affiliate.