Ally Financial’s decision to sell its Canadian auto finance operations to the Royal Bank of Canada for $4.1 billion, and The Toronto-Dominion Bank’s $5.9 billion purchase of Target’s credit card portfolio has yielded roles for a quartet of top Am Law 100 firms.
Sullivan & Cromwell M&A partner Andrew Gerlach and corporate partner Jay Clayton are leading a team from the firm advising Detroit-based Ally, the former lending arm of General Motors known as GMAC until 2010.
Also advising Ally on the sale to Canada’s largest bank are S&C senior chairman H. Rodgin Cohen, Latin America practice head Sergio Galvis, tax partner Andrew Solomon, employee benefits partner Marc Trevino, and IP special counsel Spencer Simon, who joined the firm earlier this year from Jones Day, where he was partner.
The deal announced Tuesday is the second Ally transaction in as many weeks for S&C, which recently fielded a similar team to advise the bank holding company in connection with the $865 million sale of its Mexican subsidiary ABA Seguros to insurance giant ACE Limited, according to our previous reports.
William Solomon Jr. serves as Ally’s general counsel. The U.S. Department of the Treasury continues to own about 75 percent of Ally as a result of a $17.2 billion bailout by the federal government during the financial crisis. While Treasury has so far recouped roughly $6 billion of that investment through the sale of securities, Ally’s divestiture of its Canadian unit will provide proceeds for further repayment of federal loans. (Former Ally parent GM sold all of its remaining preferred shares in the company last year.)
Douglas Marshall, cochair of the corporate practice at Osler, Hoskin & Harcourt, is leading a team of lawyers from the Canadian firm advising RBC on the deal with Ally. Other attorneys working on the matter include corporate partners Stephen Clark and Kashif Zaman, antitrust partner Shuli Rodal, marketing and distribution practice head Kelly Moffatt, employee benefits partner Douglas Rienzo, and labor and employment partner Jason Hanson. Last year Osler advised RBC on its $1.1 billion acquisition of the half of London-based RBC Dexia Investor Services it didn’t already own, according to our previous reports.
David Allgood serves as general counsel for Toronto-based RBC. Heenan Blaikie strategic adviser Jacques Lamarre is a member of RBC’s board of directors, as are Paule Gauthier of Quebec’s Stein Monast and prominent Canadian lawyer Edward Sonshine.
Norton Rose Canada structured finance partner James Rumball, banking partner Suzana Lobo, and antitrust partner Kevin Ackhurst in Toronto are advising GM on an agreement in which RBC will become a provider for the auto giant’s Canadian ”subvented business” upon the close of the deal with Ally in the first quarter of 2013. (An RBC press release states that “subvented loans are low-rate consumer auto loans subsidized by the manufacturer.”)
In the second major transaction announced north of the border Tuesday, Toronto-based TD Bank, Canada’s second-largest bank by total assets, said it has agreed to acquire Target’s consumer credit card portfolio for nearly $6 billion.
Simpson Thacher & Bartlett M&A practice head Lee Meyerson, M&A partner Maripat Alpuche, financial services regulatory partner Stacie McGinn, structured finance partner Laura Palma, tax head Steven Todrys, East Coast IP transactional head Lori Lesser, and antitrust senior counsel Michael Naughton are advising longtime client TD Bank on the matter. The bank has previously turned to Simpson for counsel on its $6.3 billion acquisition of Chrysler Financial in late 2010 and $8.5 billion acquisition of Commerce Bancorp in 2007. (TD Bank tapped top Canadian firm Torys for counsel on its $8.7 billion acquisition of Bank of America’s Canadian credit card business last year, according to our previous reports.)
Several top Canadian lawyers sit on TD Bank’s board of directors. They are board chairman Brian Levitt, a former Osler cochair who is now counsel at the firm; deputy chair Frank McKenna, a former counsel at Osler and fellow Canadian firm McInnes Cooper; and Harold MacKay, a retired partner and counsel with MacPherson Leslie & Tyerman in Regina, Saskatchewan.
Christopher Montague serves as general counsel for TD Bank, whose in-house legal department in the United States was shaken up this year amid a discovery dispute involving Greenberg Traurig in litigation related to disgraced Fort Lauderdale lawyer Scott Rothstein, according to sibling publication Corporate Counsel.
The internal legal team handling TD Bank’s acquisition of Target’s credit card portfolio is being led by vice president for legal transactions Leslie Johnson, assistant general counsel Norie Campbell, managing legal counsel Josh Death and Rita DiLuca, senior counsel Rory Engels, F. Jay Meyer, and Jacqueline Parker, and legal counsel Charles McCarragher.
Skadden, Arps, Slate, Meagher & Flom structured finance partner Andrew Faulkner is taking the lead on the transaction for Minneapolis-based Target, the second-largest retailer in the U.S. behind Wal-Mart. The $5.9 billion purchase price that TD Bank has agreed to pay for the credit card portfolio is equal to the gross value of outstanding receivables. Sidley Austin advised Target in connection with legal issues related to the operation of the program agreement going forward.
Target general counsel Timothy Baer and general counsel for financial services Susan Smith took the lead in-house on the TD Bank transaction, which is expected to close in the first half of 2013. Last year Target turned to Osler and Faegre & Benson for counsel on its $1.85 billion acquisition of 220 store leases in Canada.