UPDATE, 5/23/12, 6:30 p.m. EDT: In addition to representing Citibank and Morgan Stanley in their roles as joint financial advisers to Eaton, Davis Polk & Wardwell also advised the two companies in their roles as joint lead arrangers of a $6.75 billion bridge financing for Eaton.
Cleveland-based Eaton said Monday it will pay $11.8 billion in cash and stock to acquire Irish electrical equipment supplier Cooper Industries in a deal that would save Eaton millions of dollars in taxes a year by creating a global electricity company incorporated in the Emerald Isle.
Bloomberg notes that moving the combined company’s headquarters to Dublin, where Cooper is based, will result in annual tax savings of $160 million by 2016—a result of Ireland’s lower corporate tax rates. Eaton predicted in its announcement of the deal that it will chop annual expenses by a total of nearly $535 million in four years. The combined company will be called Eaton Global and will be headed by Eaton CEO Alexander Cutler.
Cooper makes electrical products ranging from lighting fixtures to wiring devices, while Eaton produces electrical distribution equipment and hydraulic products. Together, the companies brought in $21.5 billion in 2011 revenue.
The deal is expected to close in the second half of 2012, pending regulatory approvals.
Simpson Thacher & Bartlett is advising Eaton with a team led by New York–based corporate partners Charles “Casey” Cogut, Mario Ponce, and Marni Lerner. Eaton is also receiving advice from the Irish firms A&L Goodbody and Matheson Ormsby Prentice. Mark McGuire is Eaton’s general counsel.
Davis Polk & Wardwell is representing both Citibank and Morgan Stanley in their roles as joint financial advisers to Eaton. Corporate partner Leonard Kreynin and tax partner Michael Mollerus are advising Citibank. M&A partner Phillip Mills and tax partner Neil Barr are advising Morgan Stanley.
Meanwhile, Cooper turned to Wachtell, Lipton, Rosen & Katz and the Irish firm Arthur Cox for legal advice. For Wachtell, executive committee cochairman Daniel Neff and corporate partner Gregory Ostling are advising on the transaction. Antitrust partner Nelson Fitts, restructuring partner Eric Rosof, and tax partner Jodi Schwartz are also advising.
Cleary Gottlieb Steen & Hamilton partners Ethan Klingsberg and Simon Jay are representing Goldman Sachs in its role as financial adviser to Cooper in the deal.
Bruce Taten is Cooper’s general counsel.