Despite early uncertainty about market volatility, global M&A activity is up 2 percent compared to last year, totaling $1.6 trillion for the first half of 2017, according to league tables released by Bloomberg LP and Thomson Reuters Corp.
Skadden, Arps, Slate, Meagher & Flom topped league tables when measured by number of deals by value during the first half of 2017. The firm’s lead roles on deals like Intel Corp.’s $15.3 billion sale to Mobileye NV and Becton, Dickinson & Co.’s $24 billion buy of C.R. Bard Inc. helped it rack up transactional work totaling nearly $167 billion during the first two quarters, according to Thomson Reuters.
Cleary Gottlieb Steen & Hamilton was a close No. 2 to Skadden in the Thomson Reuters rankings with nearly $162 billion in deals over the past six months. Bloomberg had Cleary Gottlieb, Davis Polk & Wardwell, Kirkland & Ellis and Sullivan & Cromwell all trailing Skadden in the deal value tables, which as previously noted by The American Lawyer can be an imprecise method of measuring M&A prowess.
In terms of number of deals announced, Jones Day once again took the top spot by volume on league tables compiled by Bloomberg and Thomson Reuters. Kirkland, as noted by sibling publication Legal Week, took top first half M&A marks in the U.K when measured by value.
The energy and power, health care and real estate industries all had strong showings in the M&A rankings to start off 2017. Thomson Reuters’ report also found that outbound M&A activity from acquirers in the U.S., as well as inbound M&A from Europe and cross-border transactions, accounted for $630.9 billion during the first half of the year, the highest totals since 2007.
In other M&A news …
Worldpay Group plc / Vantiv Inc.
On July 5, British payment processing company Worldpay agreed to be acquired by Cincinnati-based rival credit card processor Vantiv in a roughly $10 billion deal, as noted by Legal Week. Credit card companies have been targeting payment companies like Worldpay, the largest payment processor in the U.K., as consumers switch from using cash to paying via mobile devices for their purchases.
Legal Advisers: Allen & Overy for Worldpay; Skadden for Vantiv
Berkshire Hathaway Inc. / Energy Future Holdings Corp.
Warren Buffett’s conglomerate Berkshire Hathaway, ramping up its pursuit of steady returns in utilities, announced on July 7 that it would pay roughly $9 billion in cash to buy EFH, one of the nation’s largest electricity transmission companies, out of bankruptcy. EFH began Chapter 11 proceedings in 2014 and is the parent of Dallas-based power transmission company Oncor Electric Delivery Co., which will also change hands as part of the deal, according to sibling publication Texas Lawyer. The sale still needs to be approved by a bankruptcy judge and Lone Star State regulators.
Legal Advisers: Gibson, Dunn & Crutcher for Berkshire Hathaway; Kirkland for EFH; Cravath, Swaine & Moore for Energy Future Intermediate Holding Co., a holding company for Oncor; Jones Day for Oncor
Sycamore Partners LLC / Staples Inc.
New York-based private equity firm Sycamore Partners, which has remained keen on retail despite troubles plaguing the sector, announced on June 28 a $6.9 billion offer to acquire office supplies chain Staples. Despite a spate of brick-and-mortar retail bankruptcies this year, Sycamore is banking on a Staples delivery unit that sells directly to businesses to offset falling store sales. Staples was blocked last year in its bid to acquire office retail rival Office Depot Inc.
Legal Advisers: Kirkland for Sycamore; Wilmer Cutler Pickering Hale and Dorr for Staples; Cleary Gottlieb for Barclays plc and Morgan Stanley & Co. LLC as financial advisers to Staples
Walgreens Boots Alliance Inc. / Rite Aid Corp.
In an effort to alleviate antitrust concerns, Walgreens has called off a proposed $17.2 billion merger with pharmacy chain rival Rite Aid, opting instead to purchase half of Rite Aid’s 4,600 stores for $5.18 billion in cash. The deal still must pass regulatory muster, but it would give Walgreens more than 10,200 stores, as well as opportunities to cut costs and greater leverage to negotiate with health-care companies, vendors and landlords.
Legal Advisers: Simpson Thacher & Bartlett for Walgreens; Skadden for Rite Aid
EQT Corp. / Rice Energy Inc.
Pittsburgh-based natural gas company EQT announced on June 19 that it would buy Rice Energy in a $6.7 billion cash-and-stock transaction. The deal, the largest ever by EQT, will create the nation’s largest natural gas producer. It will also give the acquirer access to Canonsburg, Pennsylvania-based Rice’s midstream assets and allow EQT to drill longer horizontal wells in the state.
Legal Advisers: Wachtell, Lipton, Rosen & Katz for EQT; Vinson & Elkins for Rice Energy
Tabcorp Holdings Ltd. / Tatts Group Ltd.
A third time proved a charm as Australian regulators finally approved Tabcorp’s $4.7 billion takeover of lottery operator Tatts to create a gaming powerhouse Down Under. Tabcorp, Australia’s top horse racing and sports betting company, and Tatts had unsuccessfully tried to unite since 2006. Concerns held by the Australian Competition Tribunal stymied two previous efforts at a combination. The final deal, announced on June 20, is expected to close in August.
Legal Advisers: Herbert Smith Freehills and Gilbert + Tobin for Tabcorp.; Clayton Utz for Tatts
Greystar Real Estate Partners / Monogram Residential Trust Inc.
A new fund led by Charleston, South Carolina-based Greystar, the largest operator of apartments in the U.S., announced on July 4 that it would buy luxury apartment developer Monogram in a deal valued at roughly $3 billion, according to Texas Lawyer and fellow sibling publication GlobeSt. Plano, Texas-based Monogram owns 13,674 units in 49 multifamily communities across 10 states. To finance the deal, expected to close in the second half of 2017, Greystar received additional funding from affiliates of Dutch pension investor APG Asset Management NV, Canada’s Ivanhoe Cambridge Inc. and GIC Private Ltd., Singapore’s sovereign wealth fund.
Legal Advisers: Jones Day for Greystar; Goodwin Procter for Monogram; Morrison & Foerster for Morgan Stanley as financial adviser to Monogram
Boral Ltd. / Headwaters Inc.
Australian building supplier Boral recently completed a $2.6 billion acquisition announced late last year of South Jordan, Utah-based Headwaters. The sale, which Latin Lawyer reported yielded roles for several firms, comes amid promises by the Trump administration to invest in U.S. infrastructure. The combined company will become the largest U.S. supplier of fly ash, a key ingredient in concrete.
Legal Advisers: Skadden, Alston & Bird and Von Wobeser y Sierra for Boral; Pillsbury Winthrop Shaw Pittman for Headwaters
LetterOne Holdings SA / Holland & Barrett Retail Ltd.
L1 Retail, the retail investment arm of Russian tycoon Mikhail Fridman’s LetterOne Group, agreed on June 26 to buy British health food and supplements chain Holland & Barrett for $2.26 billion from private equity giant The Carlyle Group LP and The Nature’s Bounty Co. The target sells more than 9,000 products in over 1,150 stores in 16 countries. The deal, expected to close in September, is an indication of the continuing consumer appetite for natural foods and products.
Legal Advisers: Jones Day for L1 Retail; DLA Piper for Holland & Barrett’s management team; Latham & Watkins for Carlyle
Royal Philips NV / The Spectranetics Corp.
Dutch technology giant Royal Philips announced on June 28 that it would buy Spectranetics, a Colorado Springs, Colorado-based maker of devices to treat cardiac disease, for $2.15 billion in cash and debt. Specatranetics devices will add to Philips’ roster of medical products, which already includes scanner and ultrasound machines. The deal is expected to close in the third quarter of this year.
Legal Advisers: Sullivan & Cromwell for Philips; Cravath for Spectranetics; Davis Polk for JPMorgan Chase & Co. as financial adviser to Spectranetics
QVC Inc. / HSN Inc.
In a move to better compete against consumer giants like Amazon.com Inc. and Wal-Mart Stores Inc., West Chester, Pennsylvania-based television shopping network QVC, controlled since 2003 by cable magnate John Malone’s Liberty Interactive Corp., agreed to buy the Home Shopping Network in a roughly $2 billion deal. The transaction, expected to close by the fourth quarter of 2017, will see QVC acquire the remaining 62 percent of HSN stock that it doesn’t already own. The combined company will be the third-largest electronics retailer in the U.S.
Legal Advisers: Baker Botts for Liberty and QVC; Davis Polk for HSN
Consortium / Visma AO
Buyout giant KKR & Co. LP announced on June 29 that it would sell its entire remaining stake in Norwegian software company Visma, along with a smaller stake held by Cinven Group Ltd., for $1.81 billion to an investor group. The deal by the acquiring consortium—a group led by GIC, HgCapital, International Capital Group LLC and Montagu Private Equity LLP—is one of the largest software buyouts ever in Europe. The purchase also represents a first for a new Skadden deal team in London, as noted by Legal Week.
Legal Advisers: Latham for GIC; Skadden and White & Case for HgCapital; Ropes & Gray for ICG; Linklaters for Montagu; Freshfields Bruckhaus Deringer for Cinven; Simpson Thacher for KKR
Government Properties Income Trust / First Potomac Realty Trust
Newton, Massachusetts-based real estate investment fund Government Properties announced on June 28 that it would buy Bethesda, Maryland-based First Potomac in a $1.4 billion deal, including debt, according to GlobeSt. The acquirer owns real estate around the country that is primarily leased to government tenants. The deal, which will create a company with close to $4.1 billion in combined assets, is expected to close before year’s end.
Legal Advisers: Sullivan & Worcester for Government Properties; Hogan Lovells for First Potomac
Centerbridge Partners LP / Syncsort Inc. / Vision Solutions Inc.
On July 6, New York-based Centerbridge Partners announced a $1.26 billion deal to purchase enterprise software companies Syncsort and Vision Solutions. Upon completion of the deal, expected in the third quarter of this year, Centerbridge will merge the two companies into a single enterprise software platform operating under the Syncsort name. Santa Monica-based private equity firm Clearlake Capital Group LP, which previously owned both Synsort and Vision Solutions, will retain a minority ownership stake in the new entity.
Legal Advisers: Simpson Thacher for Centerbridge Partners
Red Ventures LLC / Bankrate Inc.
Charlotte, North Carolina-based digital marketing company Red Ventures announced on July 3 that it would buy New York-based Bankrate, an online publisher of personal finance content, in an all-cash $1.24 billion deal. The purchase by Red Ventures, which is backed by private equity firms General Atlantic LLC and Silver Lake Partners LP, is expected to close later this year.
Legal Advisers: Simpson Thacher for Red Ventures; Wachtell for Bankrate
Canada Pension Plan Investment Board / REIT Parkway Inc. / Encino Energy Ltd.
Toronto-based CPPIB, which oversees and invests pension funds on of at roughly 20 million Canadians, announced two major moves in recent weeks. On June 30, the CPPIB paid $1.2 billion to buy real estate investment fund REIT Parkway, which owns the largest office portfolio in Houston, as noted by GlobeSt. That transaction, scheduled to close in the fourth quarter of this year, is part of a long-term strategy by CPPIB to invest in stable assets in the U.S. market. The CPPIB also partnered on June 28 with Houston-based Encino Energy to form Encino Acquisition Partners, a joint venture that will invest up to $1 billion in U.S. oil and gas assets.
Legal Advisers: Sullivan & Cromwell for CPPIB on the REIT Parkway deal; Hogan Lovells for REIT Parkway; Vinson for CPPIB on the joint venture; Gibson Dunn for Encino Energy
Link Group / Capita Asset Services
Link Group, an Australian financial services firm, announced on June 26 its $1.02 billion acquisition of the asset management services arm of the U.K.’s Capita plc. The deal is a part of a European expansion plan by Link, which provides technology to manage financial ownership data, to leverage Capita’s client relationships and market positions on the continent. The transaction is expected to close by Dec. 31.
Legal Advisers: Allen & Overy and DLA Piper for Link Group; Eversheds for Capita; Baker McKenzie for joint lead managers and underwriters
Konica Minolta Inc. / Ambry Genetics Corp.
On July 6, Japanese digital technology giant Konica Minolta announced its acquisition of Aliso Viejo, California-based diagnostics company Ambry Genetics for up to $1 billion in cash. The purchase marks the largest ever for the Tokyo-based photocopier manufacturer as it looks to move away from the office equipment business and into a leading position in precision medicine. The transaction is expected to close by year’s end.
Legal Advisers: Baker McKenzie for Konica Minolta; Jones Day for Ambry Genetics
Diageo plc / Casamigos Tequila
On June 21, London-based beverage giant Diageo announced its purchase of the premium Casamigos Tequila brand—backed by a group of investors led by George Clooney—for up to $1 billion, as noted by Texas Lawyer. The deal signals a push by Diageo, the world’s largest spirits maker, to gain more ground in the fast-growing global tequila market. The deal is expected to close in the second half of 2017.
Legal Advisers: Sullivan & Cromwell for Diageo; Wilson Elser Moskowitz Edelman & Dicker for Casamigos