ALM Properties, Inc.
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Who Reps 2012: Going With Experience
Company: United Rentals Inc. (commercial and construction equipment rentals)
Legal Matter: $4.2 billion acquisition of RSC Holdings Inc.
In-House Counsel: Jonathan Gottsegen, general counsel
Ouside Counsel: Frank Aquila, Sullivan & Cromwell (New York)
Corporate Counsel: Why did United Rentals want to acquire RSC [its largest competitor in equipment rentals]?
Jonathan Gottsegen: We had crossed paths with RSC for a long time. There was always a mutual admiration. Strategically, most observers would agree that the combination was a phenomenal fit. The companies were similar from a management and operations perspective, and were similar as to where they stood in the marketplace. The companies had complementary technologies, customer profiles, and branch networks.
CC: How did you choose Frank Aquila and Sullivan & Cromwell for the transaction?
JG: Even before RSC came into the picture, both the United Rentals board and senior management and myself personally had experience working with Sullivan & Cromwell. I first met Frank during my stint at Home Depot, where I was the securities and finance lawyer. The more you work with and rely on counsel, and they're able to execute across a wide spectrum of complex and difficult matters, the more comfortable you feel with one another. And the more inclined you are to further the working relationship because you know they'll get it done, and they'll get it done the right way.
CC: What made them right for this deal?
JG: With something like public M&A, we knew going in, from a legal perspective, that virtually every practice area would get picked up. There's obviously M&A deal documentation. There are also issues related to governance, commercial diligence, litigation, employment and executive compensation, tax, corporate finance, and antitrust. So you need a partner that has a deep bench with technical but also practical expertise in all of those areas. And given Frank's and S&C's expertise in large, public M&A deals, they were the right fit.
CC: What was the biggest challenge of working on the transaction?
JG: Deals like these are marathons. We needed clearance from multiple governmental agencies. We needed a successful financing. We needed stockholder approvals. On one hand, it requires considerable attention to detail, but it also requires perspective. S&C's team supported, and worked seamlessly with, our internal staff. Not only legal, but accounting, treasury, human resources, senior management, and the boardfrom the negotiation, to the time the deal was announced in December 2011, through the financing stage, the review by governmental entities, stockholder meetings, and the closing of the transaction in April.
CC: What were the major milestones you had to work through?
JG: I can highlight three of them: receiving clearance from the competition authority in Canada required a lot of work and diligence. By the same token, receiving regulatory clearance from the Federal Trade Commission was equally significant and satisfying. Third would be getting through the Securities and Exchange Commission review process.
CC: What did outside counsel bring to the table on those fronts?
JG: It's the same thing: In circumstances like this, you want to work with outside counsel who have been down the road before. You don't want to make a mistake here. It's too large, there's too much exposure, it's too public. And so that's why we chose to partner with someone like S&Cbecause they have that bench and that history of doing deals like this in the public M&A context. They know the process, they know the drill, and they recognize what it takes to get to the finish line.