The tussle between Paribas, Societe Generale and Banque Nationale de Paris (BNP) took a new turn last week, when the French banking regulator COB issued a double-edged ruling which threatened to break apart Paribas’ defence to the hostile takeover bid by BNP.
COB ruled that Paribas should have revealed its defensive pact with French insurer AXA, which has a 7% stake in Paribas, when BNP first announced its bid. Both AXA and Paribas had agreed not to sell their cross shareholdings without the other’s approval.
Paribas only revealed the pact when it issued its response to the bid, two weeks after it was made. COB has ruled that the agreement is null and void because it was not disclosed. Early reports had Paribas fuming at the ruling, with chairman Andre Levy-Lang saying that his lawyers – Jean-Pierre Martel at Rambaud Martel and Linklaters & Alliance’s Thierry Vassogne – had told Paribas it was unnecessary to reveal the pact.
But now Paribas has calmed down and a spokesman told Legal Week it had no intention of appealing. A source said Paribas was confident that the pact was “perfectly valid and binding” and that it would continue to form the core of its defence against BNP.
With the arrival of BNP’s hostile bid the matrix of French and international legal advisers has developed into an interesting pattern. Paribas is using Linklaters & Alliance alongside specialist M&A firm Rambaud Martel; Societe Generale is using Sullivan & Cromwell and takeover specialists Darrois Villey Maillot Brochier; while BNP is using another M&A specialist, Bredin Prat, alongside Paris firm Veil Armfelt Jourde La Garanderie and Cleary Gottlieb Steen & Hamilton for US advice.
Sullivan & Cromwell partner Pierre Servan-Schreiber says: “It is interesting that in such a large [French] takeover battle the Anglo-Saxon firms have such a prominent role. It used to be just the usual players.
“French clients are turning toward good teams of French lawyers in large Anglo-Saxon firms,” he adds.
Travers has fastest-growing clients
If you asked corporate lawyers which firm had the most – and most profitable – FTSE and AIM-listed clients on its books the vast majority would plump, rightly, for Slaughter and May.
But ask which firm acts for the fastest-growing client base and clients with the fastest-increasing earnings and most would be left scratching their heads.
So step forward Travers Smith Braithwaite, whose 41 listed clients saw their pre-tax profits grow by more than 20% according to the latest edition of the Hemscott Company Guide.
After Travers Smith comes Clifford Chance, Norton Rose, Dibb Lupton Alsop and Eversheds.
Fast-growing clients are good news for the law firms that act for them, requiring advice on the investments and expansion that comes hand in hand.
So, while Slaughter and May remains undisputed top dog, the partners at Travers Smith and the others will be looking to piggyback on their clients’ growth.
(See news story, page 2)
Bill heralds ‘adverse tax regime’
Linklaters, the tax committee of the City of London Law Society and various professional and industry bodies are busy putting pressure on the Inland Revenue to amend proposals in this year’s Finance Bill that “subject UK bondholders, particularly convertible bondholders, to an unexpectedly adverse tax regime”.
Or so says Linklaters partner Martin Lynchehan. The intention of the bill is to close a loophole in the old relevant discount securities (RDS) rules which allowed bonds that were certain to be redeemed for a premium to be taxed as a capital gain rather than income.
Lynchehan says the new rules are too wide and will affect new issues as well as the tax profile of existing bonds. This week the bill reaches the committee stage and Lynchehan is “quite confident it will be amended”.
