MAGAZINE
September 2022 Issue
Financier Worldwide Magazine
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COVER STORY
When it comes to M&A, potential acquirers are increasingly seeking to identify ESG-related risks and opportunities in target companies, and pursuing deals according to their own ESG principles and expectations.
FEATURES
Distressed M&A: opportunities, strategies and disruption
With the impact of disruptive events continuing to touch companies, sectors, countries and individuals across the globe, such an environment lends itself to distressed investment opportunities.
UK regulatory initiatives: themes and issues
It is logical to assume that the direction of travel will be toward greater regulation in areas such as cryptocurrency and crypto assets, as well as a persistent focus on sustainability.
Corporate culture in the age of remote working
There should be an understanding that corporate culture is not static; it adapts and evolves as circumstances change – as the pandemic starkly demonstrated. Through flexibility, companies can flourish and generate value.
Analytics at work: a data-driven approach to compliance
As global data volumes continue to grow, financial services firms need to stay ahead of the curve and navigate an ever-changing landscape – all the while searching for the ideal pathway to a more data-driven approach to compliance.
Cyber resilience: immediate response and effective recovery
In the case of a cyber attack, an immediate response from the targeted company can make all the difference between temporary difficulties and long-lasting damage.
ROUNDTABLE
Foreign investment and national security
Going forward, there is every indication that the global foreign direct investment landscape will continue to be active, with national security oversight a key priority. FW moderates a discussion between Chase Kaniecki at Cleary Gottlieb Steen and Hamilton LLP, Judith Alison Lee at Gibson, Dunn & Crutcher LLP, Christopher Peacock at Hogan Lovells International LLP, Mario Mancuso at Kirkland & Ellis LLP, and Eric J. Kadel, Jr. at Sullivan & Cromwell LLP.
SPECIAL REPORT
Q&A: Private equity investment and emerging technologies
PE firms should continue to be aggressive in creatively structuring and financing emerging technology deals. Companies offering technologies that address labour shortage and cost inflation problems may be attractive to PE firms. FW discusses private equity investment and emerging technologies with Erich Bergen, Dave DuVarney and Brian Francese at Baker Tilly US, LLP.
Private equity-led M&A trends – from boom to?
CMS The ongoing stress on markets is visible through deal dynamics in 2022 to date: transactions are still happening, but the pace is significantly slower than in 2021 and unsurprisingly valuations are the main point of attrition and delay.
The impact of public market dislocations on private markets
Adams Street Partners Investors who have worked through numerous market cycles are less likely to be paralysed by emotion and fear when they see large declines in liquid markets. They are likely to remain calm, dust off their dislocation playbooks from 2001 and 2008, and begin proactively targeting great deal opportunities.
Growth equity minority investments
Davis Polk & Wardwell London LLP Growth equity investment, where PE funds invest in established businesses with significant growth prospects predominantly through minority stakes, has grown significantly in the last 10 years.
Private equity in the antitrust crosshairs
Proskauer Rose LLP No longer in the antitrust shadows, PE is being called upon to make its case for the benefits it brings to transactions and companies. In most cases, it should not be hard to do.
Navigating conflicts of interest in the GP-led secondary market
Travers Smith Single asset GP-led deals are not easy to do, and investors and regulators rightly expect an open and fair process.
Trends in infrastructure shareholders’ arrangements
Simpson Thacher & Bartlett LLP Many of the market trends in infrastructure shareholders’ arrangements have arisen due to infrastructure investors in earlier vintage deals experiencing difficulties when wishing to sell their stakes.
Developing trends in private equity financing
Wachtell, Lipton, Rosen & Katz Two important trends in private equity financing have gained steam: first, the continued rise of ‘direct lenders’, and second, the increasing frequency of partnerships between creative borrowers and creditors to raise capital and reduce liabilities.
Q&A: Prioritising ESG in private equity
Since PE firms are in the business of value creation, ESG is a natural fit. Companies that integrate ESG into their business models will drive competitive advantage, efficiency and sustainable growth. FW discusses prioritising ESG in private equity with Karen Baum at BDO.
TALKINGpoint
Managing digital asset and cryptocurrency risk
Identifying and enforcing against digital assets is possible, but presents unique challenges, and requires industry knowledge and a clear strategy to attain. Regulation will drive greater accountability for financial services firms and will lead to increased scrutiny as to the sources of funds and the ownership of digital assets. FW discusses managing digital asset and cryptocurrency risk with Thomas Choo, Peter Hodgins, Lee Bacon, Zhen Guang Lam and Alexandra Lester at Clyde & Co.
Artificial intelligence and intellectual property
AI/ML innovations will drive the speed at which companies create new and better end-products incorporating innovations which would have taken years if not decades for humans to conceptualise. Unless there is a major change in the patent system, trade secret protection will continue to be the most commonly used way to protect AI inventions. FW discusses artificial intelligence and intellectual property with Frank L. Gerratana, Marguerite McConihe, Adam S. Rizk, Terri Shieh-Newton and Lily Zhang at Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
Cross-border restructuring between northern and southern Ireland
Among Irish companies, the true level of distress has been masked by government support schemes introduced during the pandemic. Asset value maximisation is not feasible unless there is effective coordination and cooperation between practitioners north and south of the border. FW discusses cross-border restructuring between northern and southern Ireland with Gary Digney and Seamas Keating at FPM Accountants and Gary Daly and Seamus Hempenstall at Daly Khurshid Solicitors LLP.
DEALfront
mergers & acquisitions
Swiss duty-free retailer Dufry has agreed to buy Italian airport and motorway caterer Autogrill in a deal which will create a new travel industry giant in the post-pandemic landscape.
SD Biosensor agrees to buy Meridian Bioscience for $1.53bn
In an all-cash transaction valued at approximately $1.53bn, a consortium led by bio-diagnostic company SD Biosensor, Inc. and investment firm SJL Partners LLC is to acquire global provider of diagnostic testing solutions and life science raw materials Meridian Bioscience, Inc.
private equity & venture capital
Convey Health Solutions to be taken private
In a deal that will take the technology and services company private, Convey Health Solutions Holdings, Inc. is to be acquired by TPG Capital, the private equity platform of global alternative asset management firm TPG and Convey’s principal shareholder, for $1.1bn.
£15bn UK Power Networks deal collapses
The proposed £15bn takeover of UK Power Networks, Britain’s largest electricity distribution company, by private equity giants KKR and Macquarie has collapsed.
bankruptcy & corporate restructuring
SAS files for Chapter 11 protection
In a filing that comes hot on the heels of a pilot strike, Scandinavian airline SAS AB has received approval from the US Bankruptcy Court for the Southern District of New York for all of its ‘first day’ motions as part of the company’s voluntary Chapter 11 process in the US.
Enjoy Technology files for Chapter 11 protection
In June, Enjoy Technology Inc., a retail company established by Ron Johnson, a former executive at Apple and J.C. Penney, filed for Chapter 11 bankruptcy protection at the Bankruptcy Court for the District of Delaware.
SPOTlight
Deal certainty in M&A agreements – current concerns
Cadwalader The past few years have seen extraordinary turbulence. While M&A deals have continued to be negotiated apace, privately and publicly, some buyers have come to regret their bargains, and some may have been reviewing the terms of their contracts to find a way out.
Pillars of IP governance for financial institutions
Norton Rose Fulbright Australia Even businesses that might not consider themselves active in the patent litigation space should have an IP litigation preparedness ‘playbook’ as part of their overall IP strategy.
Samiracles Consulting The world needs tacticians who can execute plans with exquisite attention to detail. Absent that capability in an organisation, strategies will fail.
Dawn raid preparedness: a practical guide
Drew & Napier LLC An underprepared workforce will lead to an ineffective dawn raid response. Companies are advised to regularly review their document and information access, as well as storage and retention policies.
Canada’s Competition Act amendments: merging parties stay tuned
McCarthy Tétrault LLP The new changes to the merger provisions are the intended first steps toward strengthening the Bureau’s ability to detect, review and challenge anticompetitive mergers.
Collateral damage – US sanctions target the secondary market in Russian stocks and bonds
Gibson, Dunn & Crutcher LLP In June 2022, the Office of Foreign Asset Control took the unprecedented step of prohibiting US persons from purchasing Russian debt and equity securities on secondary markets.
CONTRIBUTORS
Adams Street Partners
Baker Tilly US, LLP
BDO
Cadwalader
Cleary Gottlieb Steen and Hamilton LLP
Clyde & Co.
CMS
Daly Khurshid Solicitors LLP
Davis Polk & Wardwell London LLP
Drew & Napier LLC
FPM Accountants
Gibson, Dunn & Crutcher LLP
Hogan Lovells International LLP
Kirkland & Ellis LLP
McCarthy Tétrault LLP
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
Norton Rose Fulbright Australia
Proskauer Rose LLP
Samiracles Consulting
Simpson Thacher & Bartlett LLP
Sullivan & Cromwell LLP.
Travers Smith
Wachtell, Lipton, Rosen & Katz