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CMS Legal Services EEIG
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contactfacts and figures
CMS
Key fa c t s
Countries
28 46
>2,800 36
>5,000
140 €808m
Turnover of all CMS firms
in 2011 calendar year
Offices
Lawyers New partners in 2011
Total employees
Chambers Band 1 rankings
Chambers Band 2 rankings
The European provider
of legal and tax services
One of the reasons clients choose CMS is that we have
the most extensive European footprint of any firm. Other
reasons include our cross-border sector and practice
expertise and our outstanding reputation in key markets.
52
80
Cities
3. contents
1
Introduction & Leadership Team 02
CMS in Portugal 04
Banking & Finance 06
Commercial 08
Competition 10
Consumer Products 12
Corporate 14
Dispute Resolution 16
Employment & Pensions 18
Energy 20
Hotels & Leisure 22
Infrastructure & Project Finance 24
Insurance 26
Intellectual Property 28
Lifesciences 30
Private Equity 32
Real Estate & Construction 34
Tax 36
Technology, Media & Telecommunications 38
Client Services 40
Growth Markets 42
People & Development 44
Corporate Social Responsibility 46
Governance 48
In this year’s Annual Review
4. D
espite the challenging market conditions
across Europe and turbulence in the
world economy, 2011 was a year of
growth and expansion for CMS. As the largest
provider of legal and tax services in Europe,
we increased our fee income, which for the
second year running amounted to more than
€800 million. Our cross-border teams of sector
specialists competed successfully for business,
winning a substantial number of pitches.
In last year´s Annual Review, we announced our
co-operation agreement with leading Portuguese
law firm Rui Pena, Arnaut & Associados. We are
delighted to be able to report that, after several
months of working together successfully, our
Portuguese friends officially joined CMS on
1 January 2012, a year ahead of schedule. CMS
Rui Pena & Arnaut, as the firm is now known, will
expand our reach in Iberia and in Portuguese-
speaking countries worldwide.
This Annual Review displays the work of CMS over
the past year across practices, industry sectors and
countries. It reinforces our claim to be the biggest
provider of legal services in Europe, covering more
jurisdictions with more lawyers than any of our
competitors. The Annual Review also shows how
CMS works on complex, cross-border transactions
and really understands the business issues facing
our clients.
Our success would not be possible without our
people. For lawyers at every stage of their career,
the CMS Academy provides a learning programme
of business-related skills that complements
their regular legal training. For all staff, the CMS
Induction Course gives new joiners the key facts
about CMS and helps them navigate their way
around the CMS world.
Looking ahead, we are confident that our broad
geographical coverage and deep expertise will
enable CMS to continue to provide the service
that our clients need. With no end in sight to the
uncertain economic situation across many of
the jurisdictions in which we operate, we will be
maintaining this approach.
I hope that this Annual Review gives you a good
impression of the people behind CMS and of the
values and principles that shape what we do.
As always, if you have any questions or thoughts,
we hope that you will get in touch with us.
Cornelius Brandi
Chairman of the Executive Committee
cornelius.brandi@cmslegal.com
Welcome to the 2011–2012 CMS Annual Review
CMS had a year of
growth in 2011. We
increased fee income
and won a large
number of pitches
introduction
2 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
5. Duncan Weston
London
Pierre-Sebastien Thill
Paris
Dolf Segaar
Amsterdam
Peter Huber
Vienna
José Luís Arnaut
Lisbon
Carlos Peña Boada
Madrid
Stanislas van Wassenhove
Brussels
Hubertus Kolster
Berlin
Managing partners’ group
Pietro Cavasola
Rome
Patrick Sommer
Zurich
chairman
Cornelius Brandi
cornelius.brandi@cmslegal.com
executive director
Matthew Gorman
matthew.gorman@cmslegal.com
See page 48 for more on CMS Governance
the cms L E A D E R S H I P T E A M
3
Our
leadership
team
i
6. CMS adds
Portuguese capacity
cms in portugal
4 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
Client Law Firm
of the Year,
CMS in Portugal
Chambers Europe Award
for Excellence 2012
C
MS welcomed a leading Portuguese law
firm as a new member on 1 January 2012.
This represents CMS’ 52nd office,
while Portugal is its 28th country.
With a history dating back to 1964, the
new member firm is well established in the
Portuguese market. It also maintains a network
of relationships with other law firms in Angola,
Brazil and Timor, enabling CMS to meet the
needs of its clients in these jurisdictions.
A large number of CMS’ 60 lawyers and tax
advisers in Portugal are rated as ‘leaders in their
field’ by the influential client guide Chambers
Europe. The office is also highly regarded across
numerous practice areas by the Europe,
Middle East and African edition of
The Legal 500.
Explaining his firm’s decision to join CMS,
Portuguese founding Partner José Luís Arnaut
comments: “The move will allow the firm to
reinforce its Iberian strategy, while becoming
a European powerhouse.”
“This adds an important jurisdiction to our
European growth strategy,” says CMS Chairman
Cornelius Brandi. “CMS in Portugal can continue
to build on its longstanding, excellent reputation,
while simultaneously strengthening our European
offering to clients.”
8. banking & finance
6 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
It was a finance deal that was
advantageous to all the parties involved.
It paved the way for new investment in
Serbia’s state-owned telecoms provider,
Telekom Srbija. And debt-laden Greek
telecoms company OTE was able to inject
some much-needed cash into its balance
sheet. The deal was heralded as one of
the largest finance transactions in south-
eastern Europe in 2012.
The role of the CMS Prague-based Central
and Eastern Europe banking team was
to advise the client, UniCredit, as one of
the lead arrangers of the loan to Telekom
Srbija. The syndication of the loan was
heavily over-subscribed, with 19 banks
taking part.
Most of the proceeds of the loan in the
€470 million deal were intended to help
Telekom Srbija buy back 20% of its shares
from OTE. The remainder refinanced
its existing loan facility. The Serbian
government owns the remaining 80%
of Telekom Srbija.
“This was a unique deal in terms of
public interest, volume, structure
and the size of the syndicate,” says
CMS Banking Partner Mark Segall,
who led the deal. “Banks were eager
to be part of it and the syndicate kept
growing as the transaction evolved.”
Telecoms loan for
share buy-back
When advising high-profile, cross-
border lenders on a complex deal
to provide finance for a major global
company, it helps to have offices
around the world.
That was certainly the case in 2011,
when an integrated banking team
from CMS, comprising lawyers from
Amsterdam, Hamburg, London
and Madrid, advised the lenders of
a €205 million syndicated loan to
Bominflot Group, one of the world’s
largest independent traders of
bunker oil for ships. Deutsche Bank
AG and HSH Nordbank AG were key
lenders, while ABN AMRO Bank, ING
Bank and others also provided funds
to the syndicate.
The loan was designed to provide
Bominflot with operational
funding, but the money also
replaces the group’s existing
finance arrangements.
The deal was structured as an
umbrella loan agreement, with
all banks using standardised
loan terms to supply funding
direct to Bominflot. CMS’
role in the deal was to advise
Deutsche Bank and HSH
Nordbank in their function
as the loan’s facility agent,
as well as advising Deutsche
Bank Luxembourg in its role as
the loan’s security agent. CMS in
Hamburg co-ordinated the advice
to Deutsche Bank and HSH
Nordbank across a number of
CMS offices. CMS in London also
co-ordinated the production of key
securities assignment documents
in countries with an English law
heritage: Gibraltar, Hong Kong
and Singapore.
More recently, CMS’ clients on
this deal have asked the firm to
revisit Bominflot’s syndicated
loan. Towards the end of 2011,
Bominflot announced it was
merging with fellow worldwide
bunkering business Mabanaft
GmbH & Co. KG.
CMS has a market-leading reputation for banking and
finance across European markets. As our recent deals
demonstrate, we regularly act for some of Europe’s
largest corporates and banks on multimillion-euro
transactions. CMS prides itself on achieving workable
solutions, whether we are structuring complex
cross-border finance deals or handling
intercreditor arrangements
CMS offices involved
Amsterdam, Hamburg,
London, Madrid
Oil trader refinancing
CMS offices involved
Belgrade, Prague
CM S a d v i s e d t h e
l e n d e r s o f a
€ 2 0 5 m i l l i o n
s y n d i c a t e d l o a n
t o B o m i n f l o t
G r o u p
€ 470 m i l l i o n
d e a l
9. 7
banking & finance
CMS Partners
head up US
equity initiative
Best Capital Markets
Law Firm of the Year
in Spain
– Corporate Intl.
The Budapest
Banking &
Finance team
is ranked in Tier 1 by
all legal directories
(Chambers,
Legal 500, IFLR)
Awards and
rankings
US securities Partner Daniel Winterfeldt
leads a team charged with developing
CMS’ international capital markets
practice. Based in London, Winterfeldt
is founder and co-chair of The Forum
for US Securities Lawyers in London, a
trade association representing more than
1,500 US-qualified lawyers and market
participants from law firms and financial
institutions in the City’s capital markets.
The Forum engages in thought leadership
on the application of, and compliance
with, US securities issues in London.
The innovative service that Winterfeldt
provides via the Forum includes an
initiative focused on the complex matter
of issuer reliance on an exemption from
registration under the US Investment
Company Act of 1940. This was
established after five prominent New York
law firms issued a memorandum on the
international application of the exemption
to equity issues, which, in some cases,
could cause problems for participants
in the London market. The Forum’s
procedures capture the range of market
practices employed by issuers.
“If you work for a non-US
investment company that wants
to sell its shares to US investors,
it’s helpful if you can find a
way to exempt yourself from
the US Investment Company
Act,” Winterfeldt says. “In many
situations, our newly developed
toolkit will allow you to do just that. It’s
based around a flexible menu of possible
procedures, each with their own points
to consider.” The draft toolkit can now be
used by issuers and underwriters accessing
the US market from London. A roundtable
event at CMS in London in December
2011 attracted more than 40 investment
banks, law firms and market makers.
Matthias Strasser from CMS in Vienna
says: “With stakeholders ranging from
the Bank of America to Deutsche Bank
providing feedback on the toolkit,
it’s pretty clear it will be well used.”
For more details, visit www.tffuslil.org
The reach of CMS
across the European
continent is impressive
and lends itself well
to a strong cross-
border practice
Chambers Global 2012
T h e t o o l k i t
h e l p s c l i e n t s
e x e m p t t h e m s e l v e s
f r o m t h e
U S I n v e s t m e n t
Co m p a n y A c t
Corrections to commercial property
values in several European countries
have had a knock-on effect on real
estate investors. The loan-to-value
covenants of some property
investment facilities are no longer
being met. As a result, many facilities
have required restructuring.
This was the issue facing The Royal
Bank of Scotland International Limited
and The Royal Bank of Scotland plc
(RBS) when they asked CMS to help
them renegotiate their existing loan
facility to Invesco Property Investment
Trust Limited (IPIT).
An important element of this deal
involved a combined CMS Banking
and Real Estate team, supported by
Corporate, reviewing RBS’ existing
security over IPIT’s pan-European
property portfolio. The CMS team
then assessed what impact IPIT’s
proposed restructuring would have
Protecting against property trust perils
on the banks’ security over the
suggested restructured loan.
Together, lawyers from Belgium,
France, Germany, Spain, the
Netherlands and the UK helped ensure
that the banks’ security was enhanced
or at least that the restructured deal
fitted within the existing security
package in each jurisdiction.
CMS Finance Partner Ian McGarr says:
“Commercial property prices in many
European countries show no signs of
recovery, so banks want to restructure
loan facilities to real estate investors.
Our pan-European Banking and Real
Estate teams make us ideally placed to
assist banks and real estate investors.”
CMS COUNTRIES
involved
Belgium, France, Germany,
Spain, the Netherlands, the UK
10. commercial
8 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
T
his year saw the launch of an official CMS
group specialising in commercial law. The
CMS Commercial Law Group works across
more than 40 offices in Europe and beyond and
has access to more than 400 specialist lawyers.
Across CMS, almost one-fifth of our Partners
operate in this specialist practice area.
The CMS Commercial Law Group was established
to provide clients, particularly multinationals, with
a one-stop service for their commercial law needs.
Besides advising on pure commercial law issues,
such as terms and conditions, distribution, IT and
supply agreements, the new group also covers
areas including data protection and outsourcing.
Sarah Hanson, the CMS Head of the group, has
ambitious plans for her team. Together with her
cross-border colleagues, she has already begun
marketing it to clients, developing new products
and engaging in internal team-building.
For the benefit of clients, the CMS Commercial
Law Group has started to roll out a series of
cross-border comparative guides on commercial
law issues. As many legal concepts do not cross
national boundaries, these guides aim to help
clients understand where differences between
countries occur. The first guide to be published
outlined how different rules apply to the legal
concept known as the ‘battle of the forms’.
Essentially, this concept refers to the successful
party when two parties each believe their
contractual terms should prevail. A new guide
covering distribution and agency arrangements is
currently in production and more are set to follow.
An important aim of the group is to share
knowledge about commercial law developments
internationally. As well as producing cross-border
guides, the group has developed a series of
commercial training webinars for clients. Also,
internally, it organised its first pan-CMS associates’
training weekend in Zurich earlier this year,
along with the TMT sector group.
The new group is likely to improve awareness of
CMS’ cross-border commercial law expertise.
“We’ve set ambitious targets to raise our profile
and we must ensure this expertise is more widely
recognised,” Dirk Loycke, the group’s Deputy
Head, says. “We’re already acting on significant
client matters and winning recognition from legal
directories such as Juve in Germany.”
D e CM S
Co m m e rcia l L aw
G ro u p is o p g e r i cht
o m cli ë nte n te
vo o r zi e n va n
e e n o n e - s to p
Co m m e rcia l
s e r v i ce*
* “The CMS Commercial Law Group was established to provide clients with a one-stop Commercial ser vice”
Commercially minded
A new, dedicated Commercial
Law Group operates Europe-
wide and further adds to
CMS’ expertise, client offering
and broad geographic reach
11. commercial
9
What’s the most significant
case you’ve ever handled?
Advising Takeda Pharmaceutical on its
€9.6 billion acquisition of Swiss drug
company Nycomed. Despite all the long
hours, it was not only my most significant
case, but also one of the most fun matters
I’ve worked on. That was largely due to the
fantastic team that I was working with.
What work are you most proud of?
Advising Camelot on the establishment
of the EuroMillions lottery when it
originally launched in France and Spain
and then the subsequent expansion to
other European countries, namely Austria,
Belgium, Ireland, Luxembourg, Portugal
and Switzerland. It represented a first in
many ways, but unfortunately I’m still
waiting for that winning ticket!
If you could change one law,
what would it be?
The law that prohibits eating mince pies
on Christmas Day that was introduced
in Britain by Oliver Cromwell. Cromwell,
the ‘Lord Protector’ who temporarily
overthrew the English monarchy in the
17th century, believed that Christmas was
plagued by the superstitions of the Roman
Catholic Church and he also thought the
tradition had pagan roots.
If one or more EU member states leaves
the euro, what happens to all the contracts
signed with businesses resident in those
countries? That is the topic of a new report,
Eurofit: How to get in shape to deal with
eurozone risks, spearheaded by our CMS
team in London.
The report highlights a range of legal
risks that any upheaval may cause and
summarises those common contract clauses
that could cause problems. It also suggests
what steps clients can take to minimise their
risk exposure, wherever possible. A wide
range of issues is considered in the document,
from currency payment options to supply
chain issues and force majeure clauses to
termination triggers.
30 seconds with:
S arah H ans o n
CMS in London
Don’t end up being
short-changed
cms-cmck.com/eurofit
Eurofit: How to get
in shape to deal
with Eurozone risks
PUBLICATIONSi
It was not only
my most significant
case, but also one
of the most fun,
due to the team
commenT
Coming to a contract
near you – a common
European sales law?
Gerd Leutner,
CMS in Berlin
By the time you read this report,
a new pan-European sales
regulation will have made good
progress towards its adoption. The
European Commission is pushing for
the new legislation to be approved
soon, possibly by the end of 2012.
While the proposed regulation
is intended to ease international
trade, its use will not be compulsory.
Parties will remain free to base their
contracts on national sales laws or
rules based on a United Nations (UN)
treaty if they prefer. In order to be
bound by the new European sales
rule, all parties must actively ‘opt in’
to the new regime.
Like existing national sales laws,
certain provisions of the new
European regulation, such as
conditions relating to the return of
faulty goods, cannot be modified
even if all parties want them to be.
But other provisions can be varied
if all parties agree.
At present, it is too early to say
whether the draft rule is more or
less onerous than existing national
sales laws. This is something
CMS is currently investigating.
But our initial reaction is that
the actual contents of this new
law will not result in extra costs
for the companies who use it.
Instead, the main challenge for
most organisations will be the
need to learn a new additional
sales law regime and how to make
appropriate use of it.
Another change resulting from the
new rule is that, for the first time,
the European Court of Justice will
gain the power to rule on disputes
that arise from the legislation.
This means the regulation will be
applied consistently across Europe.
By contrast, under the current UN
sales law regime, national courts in
each EU country tend to give slightly
different interpretations of the
meaning of the treaty.
12. 10 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
competition
Measuring up
the competition
From training clients on competition law compliance to
helping companies threatened with European Commission
fines, CMS’ Competition Group is a leader in its field
Ensuring competition compliance
across borders
Today, if a multinational company is the
target of a competition authority ‘dawn raid’
investigation in one country, it is often subject
to similar raids in others. The existence of
bodies such as the European Competition
Network or International Competition
Network means that investigations into
alleged anti-competitive behaviour are likely
to be cross-border, co-ordinated and very
challenging for any company involved.
To reduce the likelihood that clients will be
targeted in this way, CMS’ Competition Law
Group offers comprehensive competition law
compliance training all over Europe.
One of the most significant compliance
programmes that CMS helped with in the past
12 months was for longstanding client K+S,
a leading supplier of salt and fertilisers. CMS
provided competition law compliance training
in 20 countries for the company.
The training programme undertaken by
K+S comprised two elements, the first being
guidance on competition law relevant to
the management and all sales forces in the
organisation. The second part comprised
‘dawn raid’ training and a series of checklists
for company personnel most likely to be under
scrutiny if a competition law investigation
takes place. These might be management,
sales forces, the legal department, compliance
personnel, the head of electronic data
processing and front-desk reception staff.
“It was important to the client that our guides
were translated into all local languages
where K+S has operations,” explains Harald
Kahlenberg, Head of the CMS Competition
Law Group. “Most people prefer guidance in
their native language, especially as they may
use it in stressful situations. For example, in
Germany, a competition investigation may
involve the police, who often arrive armed.”
Kahlenberg adds: “CMS’ ability to offer
such extensive compliance training is helped
by the fact that we have one of the largest
competition law groups in the world –
140 specialists based in 29 European cities.”
CMS in Mori Seiki hat-trick
CMS has had a relationship with Japan-based
engineering technology firm Mori Seiki for
years. Work undertaken has included advising
on a deal to increase Mori Seiki’s stake in
Germany’s DMG (Gildemeister). Recently,
CMS acted on another matter related to the
two companies – the third such competition
instruction since 2009.
The latest instruction involved helping obtain
cross-border competition law clearance of
a Swiss joint venture between Mori Seiki
and DMG. This alliance will take over the
distribution and service activities of both
companies in all European countries, except
Germany. Meanwhile, DMG took over Mori
Seiki’s equivalent operations in Germany.
CMS helped Mori Seiki review its merger
control filing requirements throughout Europe.
This resulted in the need to make merger
control filings in Austria, Germany, Italy and
Poland. In addition, a filing was made to the
Swiss Competition Commission.
“The co-operation of competitors requires a
cautious approach under competition law,”
explains CMS’ Kahlenberg. “When advising
Mori Seiki on this latest matter, it was helpful
to draw on the same CMS competition law
team that had advised the company the
previous year. They already knew our client’s
business, as well as its joint venture partner.”
CMS aids 90% reduction in EU fine
Breach of EU competition law can leave
companies facing fines worth 10% of
global turnover – enough to put even large
firms under severe financial pressure. The
consequences can be worse if the alleged
13. 11
competition
What’s the most significant case
you’ve ever handled?
I advised on competition law issues
relevant to a merger between two large
pharmaceutical companies that had a
very high combined market share across
a number of markets. That kept me busy
for about five months.
What matter are you most
proud of?
As a young associate, I managed to have
a cartel fine that had been imposed on
a medium-sized construction company
reduced from €500,000 to €30,000
in proceedings before the Dutch
competition authority. Bankruptcy was
avoided and many jobs were saved.
If you could change one law,
what would it be?
I would change the rules requiring the
notification of mergers to competition
authorities in many member states of
the European Union. These laws create a
disproportionate burden for companies.
Tell us something interesting
about yourself
Before I joined CMS, I worked as a
référendaire – an assistant to a judge –
at the Court of Justice of the European
Union in Luxembourg for three years.
It was a truly great experience to practise
law at the heart of the European Union.
Now, I am able to draw upon this
experience, giving our clients better
EU and competition law advice.
30 seconds with:
Edm o n O ud e
Elferink
CMS in Brussels
Das CMS-Team konnte
eine Reduzierung
der Geldbuße von
Baerlocher um 90
Prozent erreichen
“The CMS team secured a 90%
reduction to Baerlocher’s fine”
Office Head Michael Bauer, secured a 90%
reduction in the fine to just €1 million.
The Baerlocher case was a legal first for
two reasons. First, the reduction was the
first successful ‘inability-to-pay’ application
under new fining guidelines issued by the
European Commission. Second, the fine
reduction was the largest ever obtained
under the ‘inability-to-pay’ rules to date.
The CMS team has since been asked by rival
law firms how it achieved this outcome. One
of Baerlocher’s competitors is challenging
the decision at the EU General Court, saying
Baerlocher’s fine reduction was unjustified.
wrongdoing took place over a prolonged
period and involved a firm’s main product.
This was the case for global chemicals
company Baerlocher, when it was
investigated by the EU Commission for its
role in a cartel in the plastic additives market.
A threatened fine of more than €20 million
was more than the company could afford.
However, a CMS team, led by EU Law
award wins
Global Competition Review 100
2012 ‘A Guide to the World’s
Leading Competition Law
and Economics Practices’:
CMS rated as leading competition
law experts in Austria, Germany,
Hungary, Italy, the Netherlands,
Poland, Russia, Slovakia,
Switzerland. Recently, Global
Competition Review added CMS
in France to its list.
14. European M&A activity in the retail sector remains
buoyant. CMS’ Consumer Products Group acts
for buyers and sellers alike
CMS at
Mid Europa’s
convenience
T
he Central and Eastern
European (CEE) retail sector has
proved a fertile area for CMS
recently. Just weeks after helping
to conclude the Delhaize Group’s
€932.5 million acquisition of Delta
Maxi, CMS was appointed by long-
standing client Mid Europa Partners
to help with its bid to take control
of Zabka Polska. Zabka is one of the
largest chains of convenience stores
in Poland, with 2,400 branches and
sales of about €640 million in 2010.
Mid Europa had Zabka in its sights
for some time. The convenience chain
had previously come onto the market
in 2007, but Mid Europa lost out on
that occasion to Penta Investments,
a Central European investment group.
When it became apparent later that
Penta was putting Zabka up for sale,
Mid Europa quickly called in CMS to
help with its tender.
However, as Warsaw-based CMS
Corporate Partner Marek Sawicki
explains, Mid Europa faced fierce
competition in its renewed bid to
win control of the retail chain.
“The disposal was arranged as
a beauty contest and we knew that
several private equity houses were
likely to be bidding against our
client,” Sawicki says.
“Once Penta decided that Mid Europa
was its preferred bidder, it imposed
a very tight timetable for negotiating
the deal. A CMS team, including
myself, Dariusz Greszta and Jakub
Marcinkowski, started discussions
one morning and the deal was signed
the next day after just 24 hours of
talks,” he adds.
Sawicki maintains that he is confident
that there is scope for more deals of
this type in the CEE retail sector.
“Our lawyers are aware of increased
activity at the moment, both in
terms of new deals being done and
also those currently in the pipeline,”
he concludes.
12 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
C onsumer products
12 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
15. CMS advises on
Saturn sale for
Metro Group
The Metro Group is one of the
world’s largest retailers, with
an annual turnover in excess of
€66 billion. So, it was a great coup
for CMS to be chosen to act for this
important client when it decided
to dispose of 34 of its Saturn stores
in France, following a strategic
review. The shops were purchased
by international retailer the
HTM Group, formerly known as
Boulanger S.A.
An 18-strong cross-border CMS
team, including lawyers from
Brussels, Cologne, Lyon and Paris,
helped the Metro Group on the
disposal, working to a tight two-
month deadline. The transaction
drew on a wide range of CMS’ legal
specialties, including corporate and
M&A, competition, employment,
IP and IT, real estate and tax.
As part of the deal, 2,000 Saturn
employees, who generate sales of
about €583 million annually, were
transferred to HTM. After a short
transition period, HTM intends to
rebrand the Saturn stores with the
Boulanger name.
C onsumer products
13
events
Breakfast briefing
for consumer
products clients
This year, the Consumer Products
Group in London is hosting a series
of roundtable breakfast briefings
and discussion forums across a range
of topics affecting consumer products.
These subject areas include health
and nutrition claims in food and
drink, category management, media
marketing, corporate reorganisations,
running competition law compliant
promotions and advertising issues.
The forums are designed to bring
together in-house legal professionals
for an in-depth discussion of the chosen
legal topic. These events give the
participants the opportunity to
discover how key legal issues for
consumer products companies
relate specifically to their own
business interests.
Attendees have welcomed the
opportunity to engage in exchanges
with their peers about the similar
challenges and experiences they face
day-to-day. The forums allow CMS
to understand better the commercial
issues that most concern clients.
The annual CMS Consumer Products
Conference is on 25 October 2012.
For information, email
louise.wallace@cms-cmck.com
What’s the most significant case
you’ve ever handled?
A very important insurance matter
that involved a railway accident.
What matter are you most
proud of?
It was a complex product liability case
where there was a claim against a
manufacturer of electronic devices.
The claimants were demanding
compensation for damages following
a fire that had destroyed an apartment.
They claimed that one of the
manufacturer’s products was to blame
for the blaze. All circumstances were
apparently in favour of the claimants, but
a very long and complex investigation
carried out by court-appointed experts
and by the parties’ own experts revealed
that the claim was groundless.
If you could change one law,
what would it be?
I would change the Italian procedural
system, which is incredibly complex
and formal and would benefit from
being simpler.
30 seconds with:
Pa o la Ghez zi
CMS in Rome
I would change the
Italian procedural
system, which is
complex and formal
16. A Christmas present for Kennametal
It was one of the largest and most complex
deals Kennametal Inc had ever undertaken,
spanning eight jurisdictions. To complicate
things further, the parties wanted to complete
the transaction within three months. But
neither challenge posed a problem for the
40-strong team of CMS lawyers advising
Kennametal, a New York-listed metals
company, on its bid to buy the Deloro Stellite
Group, a specialist alloy solutions producer.
“Shortly after negotiations began, we ran
into the Thanksgiving celebrations in the US,
followed by Christmas and New Year. There
were, not surprisingly, deal-specific issues,
too,” says London-based Corporate Partner
Martin Mendelssohn, who led the deal.
By the time the deal closed, CMS lawyers
from eight countries, including China, France,
Germany, Italy, Luxembourg, Russia and the
UK, had helped Kennametal in its bid to
buy Deloro. A range of legal specialisms
had been deployed, including corporate,
competition, pensions, employment,
real estate and tax experts.
The acquisition process revealed the conflicting
mindsets of the European private equity seller
and the New York-listed US trade buyer.
“There were differing attitudes to matters,
such as the repetition of warranties at closing
and material adverse change provisions,”
says Mendelssohn. “The ‘locked box’ concept
– where the buyer takes the risk and benefit
of the target business from an historic date
without any purchase price adjustment – is not
as widely used in the US as it is in Europe.”
Although the date of the deal’s signing –
Friday, 13 January 2012 – might have seemed
inauspicious to some, Kennametal’s General
Counsel Kevin G Nowe was delighted
with the acquisition, which completed on
1 March 2012. Nowe paid tribute to the
cross-border CMS team, thanking them
for their “tireless effort” and their “most
professional representation of Kennametal in
this transaction”. He adds: “I don’t think CMS
could have done any better.”
France and Germany working in unison
CMS teams from France and Germany joined
forces to advise the EADS Group on a deal that
established a new world leader in maritime
security. Signalis, a joint venture company,
was formed by the merger of Sofrelog and
Atlas Maritime Security.
Before the merger, Sofrelog was a subsidiary
of Cassidian, formerly known as EADS Defence
& Security. Atlas Maritime Security was a
subsidiary of naval and marine electronics
company Atlas Elektronik. The combined
entity, whose services range from small-scale
shipping monitoring systems to powerful
coastal surveillance systems, currently operates
in 50 countries worldwide.
The full-service CMS team in Germany was
led by Hamburg-based Corporate Partner
Ludwig Linder and Tax Partner Heino Büsching.
The CMS team in Paris included Tax Partner
Edouard Milhac and Corporate Partner
Jean-Robert Bousquet.
Spanish client expands into Europe
CMS in Spain led a €222 million deal in which
office supplies business Unipapel SA acquired
Spicers Group, the continental European
business of DS Smith plc.
CMS lawyers from seven countries advised
on the transaction, representing longstanding
client Unipapel. Now qualifying as Spain’s
largest maker and distributor of paper
products, the Unipapel Group is set to become
the leader in the European office supplies
industry as a result of the acquisition.
The cross-border CMS team was led by
Unipapel’s client relationship partner in
Madrid, Corporate Partner Rafael Suárez
de Lezo. CMS offices in Belgium, France,
Germany, Italy, the Netherlands and the UK
provided additional input.
corporate
14 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
Cross-border deals are CMS’ lifeblood. Our M&A team
had a busy year in 2011-2012
Collaboration
is key in M&A
CMS led a €222 million
deal in which Unipapel
acquired Spicers Group
17. corporate
15
corporate
rankings
1st Europe
Bloomberg, Thomson Reuters
Buyout by volume, mergermarket
Counsel to principals
by volume, Bloomberg
1st Central and Eastern Europe
Deals by deal count, Bloomberg
1st Germany
Deals by deal count, Bloomberg,
mergermarket, 2011 Thomson
Reuters and Corpfin mid-market
30 seconds with:
T ho mas M eyding
CMS in Stuttgart
PUBLICATIONSi
The latest edition of CMS’ highly
regarded analysis of M&A transactions
in Europe has recently been published.
The study is a detailed analysis of the
European M&A deals that CMS acted
on between 2007 and 2011 – more than
1,300 in number.
CMS Head of Corporate Thomas
Meyding says: “Clients continue to tell
us how useful the study is, so we are
pleased to publish its latest edition.”
The fourth edition of
the CMS European
M&A Study
What’s the most significant case you’ve
ever handled?
That is very hard to say, because every
transaction is significant and unique due to
the human dynamics. One of the most recent
significant transactions was the sale of a 50%
stake for €2.35 billion in Dekabank. I was
representing eight different Landesbanken
(regional state banks).
What matter are you most proud of?
I can say that so far no litigation has arisen out
of M&A projects that I have been involved in –
except for one that involved fraud on the
other side.
If you could change one law,
what would it be?
The Pareto principle. I would love to have 99%
of the possible results with an investment of
20%. That would make life much easier and
I could do so much more.
Tell us something interesting about yourself
At work I survive on apples, Gummibaerchen
(jelly bears) and Diet Coke.
18. F
or parties involved in complex cross-border
disputes, international arbitration can
sometimes be expensive and time-
consuming, says Guy Pendell, Head of CMS’
Dispute Resolution Group.
While some of this time and cost is inevitable,
CMS has been exploring ways of improving the
situation for clients. One solution is a new process
known as WAVE – Work Allocation for Value
and Efficiency.
The principle behind WAVE is simple: minimise
costs by using a cross-border team of lawyers in
all suitable cases. This allows the client, after
discussions with the lead Partner, to have items
of work undertaken by appropriate lawyers in
the most cost-effective location. For example,
document reviews and initial witness interviews
can often be undertaken locally, using lawyers
who are not only experienced in international
disputes, but also fluent in one or more of the
languages relevant to the dispute.
In some cases, this means witness interviews
can be conducted in the native tongue of the
individual concerned and then translated without
the need for interpreters. Equally, conducting an
initial document review in the native language
can save significant translation costs. Our ability
to offer this service is just one of the benefits of
having a Dispute Resolution Group spanning
25 CMS offices, according to Pendell.
To deliver cost savings while maintaining the
highest level of service is essential and requires
organisation and co-ordination. All the legal team
needs to be familiar with the relevant procedures
and, of course, they must understand the
necessary issues in the case.
Catching the WAVE
of dispute success
CMS achieves this through a combined approach
of delivering effective training in cross-border
disputes to its lawyers, covering the principles
of effective case analysis, as well as offering advice
on the interviewing and examination of witnesses.
Lawyers are given advocacy training to ensure
that they understand the different approach to
hearings in different jurisdictions, ranging from
international arbitration to common and civil
law litigation. Once lawyers are fully trained,
cases and individual work streams can then be
planned and costed, using project management
techniques more commonly found in large
construction projects.
Adopting the WAVE approach has proved popular
with lawyers and clients. Recent WAVE-managed
matters include cross-border teams in London and
Moscow; Vienna and Bratislava; Bucharest and
Sofia; as well as in many other locations.
CMS lawyers are speeding up the resolution of cross-border
disputes, improving efficiency and saving clients money
16 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
dispute resolution
eguides.cmslegal.com/arbitration
19. CMS in Bucharest has successfully defended the
Romanian State in a significant investment treaty
arbitration before an International Centre for
Settlement of Investment Disputes tribunal.
The dispute centred on alleged violations of the
Greece-Romania bilateral investment treaty and
the European Convention on Human Rights. A
Greek investor had complained that AVAS, the
Romanian privatisation agency, had invoked a
share pledge related to his frozen food warehouse
business, which he acquired from the agency
in the late 1990s. The investor said this was
tantamount to expropriation and was unfair and
inequitable treatment.
The Romanian State, advised by CMS, argued
that the investor had not complied with the
share pledge’s conditions. The investor’s tax
liabilities and his alleged failure to comply with
EU food standards regulations were also brought
into question.
After a tribunal hearing in March 2011, the
investor’s claim – $91 million in compensatory
damages and $56 million in moral damages – was
dismissed. AVAS’ attempts to enforce the share
pledge were deemed ‘reasonable, appropriate
and justified’. The tribunal ruled the State had
not been excessive regarding the investor’s tax
liabilities and food safety regulations.
Bucharest-based International Dispute Resolution
Partner Gabriel Sidere led the CMS team. He says:
“This is the first hearing of its kind for CMS and is
of great significance.”
CMS wins for the
Romanian State
What’s the most significant case
you’ve ever handled?
One of my most significant cases involved
working for a client on about 100 civil
proceedings. This was further complicated
by regulatory and criminal proceedings
that were taking place at the time.
Consistency was vital to ensure that any
confusion was kept to a minimum.
What matter are you most proud of?
I think that I have reason to be proud
of the two cases where I managed to
convince the Supreme Court to change
its jurisprudence.
If you could change one law,
what would it be?
The law on the payment for copies from
court files. At one euro per page, it is
daylight robbery, especially in criminal
cases when the copies are needed either
to defend the client or to act for victims in
preparing their damage claims.
Tell us something interesting
about yourself
I love books. I can spend hours in
bookstores and buy hundreds of books –
then, inevitably, I struggle to find the time
to read them.
30 seconds with:
Dani ela
K aro llus - Brun er
CMS in Vienna
Dadurch hat der
Mandant die Möglichkeit,
Leistungen jeweils auf
dem kostengünstigsten
Weg erbringen zu lassen
“This allows the client to have items of work
undertaken in the most cost-effective way”
dispute resolution
17
client services
Initial case
assessment
CMS can now offer a fixed-price initial
case assessment in all disputes. The
purpose of this initiative is to allow busy
clients to use CMS as an extension of
their own in-house legal team when
resources are stretched. We can provide
case assessments at an early stage to
allow clients to make an informed
choice about pursuing a potential claim.
For clients, the process is very
straightforward. After being given
a brief outline of a dispute, plus
essential documents, CMS assesses
the merits of the case and carries out
an initial cost-risk-benefits analysis.
We can also provide strategic advice
on how to resolve the dispute and,
where it is appropriate, give a
preliminary assessment of quantum.
The law on payment
for copies from court
files is daylight robbery
20. employment & pensions
18 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
Cross-border
people solutions
CMS acts on major
international restructuring
Today’s economic climate means that many
companies find they must restructure their
operations. For businesses that work across
national borders, this can be very complex.
Inside the EU, many aspects of employment
law are governed by Europe-wide
directives and regulations. But, even within
these cross-border frameworks, important
national differences remain.
In March 2011, a major consumer products
business decided to undertake a global
restructuring and collective redundancy
programme. It wanted a particular type
of European law firm – an adviser with a
strong cross-border European presence.
Just as importantly, the chosen lawyers
would need to understand the finer points
of employment law at a truly local level.
Naturally, CMS fitted the bill. Not only do
leading client guides, such as Chambers
Europe, describe the Employment Group
as being one of the largest in the European
market, CMS is also ranked as a leading
employment law adviser in many European
countries. In addition, CMS has a strong
track record of advising multinational
clients on cross-border restructurings
across a wide range of industry sectors.
Nevertheless, this latest instruction was
the most demanding cross-border matter
CMS had handled. The advice covered a
full analysis across 16 separate European
jurisdictions of collective consultation
obligations, the impact of works councils
and protection against dismissal. The client
also requested a detailed breakdown of
the relevant processes and procedures
they were required to undertake in each
jurisdiction, as well as an indication of the
potential costs and legal challenges.
On top of this, all advice had to be
provided within a very tight timetable –
just 48 hours from start to finish.
CMS delivered on all fronts, winning
praise from the client. Speaking about
the client’s feedback, CMS Employment
Partner Anthony Fincham says: “The client
commented very favourably on our ability
to act within the brief, meeting the tight
deadline and delivering the written advice
within its budgetary constraints.”
Advising across national borders
The essential role of cross-border
employment law expertise was highlighted
when CMS advised Dutch energy company
Delta NV on the sale of a subsidiary to a
management buyout (MBO) team.
The premises to be sold were unique,
bridging the Netherlands-Germany border.
CMS can help multinational companies restructure their operations,
while complying with differing national employment laws
“For businesses that work across national
borders, restructuring can be complex”
Our Employment Group
is one of the largest in
the European market
Voor bedrijven met
internationale business,
kan een herstructurering
complex zijn
21. employment & pensions
19
What’s the most significant case
you have ever handled?
In a current employment case, a former
managing director tried to mislead his
shareholders by establishing a competing
group of companies. This breached all
written agreements with the original
company. The case has developed into
a string of court cases, all of which have
had a positive outcome for our client,
the former employer.
What matter are you most proud of?
I am very proud of my Employment team
in Amsterdam, as we have existed for
several years now and it is a very dynamic
group of lawyers.
If you could change one law,
what would it be?
I would change the rule that only allows
an employer in the Netherlands to give
notice to a member of staff once they have
obtained approval. I would also change
the formula that calculates severance pay
in the Netherlands. Currently, it results
in amounts being paid to staff that are
typically much higher than severance in
other jurisdictions.
If you weren’t a lawyer,
what would you be?
I would like to establish a foundation that
would stimulate, motivate and develop
children from poor backgrounds.
30 seconds with:
K atja van K ran enburg
CMS in Amsterdam
My Employment team
is a very dynamic
group of lawyers
CM S
n e g o t i a t e d a n
a c c e p t a b l e
a g r e e m e n t
Each half was run as a separate nation-
based company, despite being located on
the same site. When CMS advised on the
employment aspects of the MBO, it had to
devise a proposal that was legally robust in
both countries. CMS’ Katja van Kranenburg
led on the Dutch employment law aspects
of the deal, working alongside her
Hamburg-based colleague Bernd Roock.
To complicate matters, there were multiple
workers’ representative bodies to consult
about the sale, two with overlapping
coverage. At a national level, the local
Dutch and German works councils agreed
to share the consultation rights where
legally allowed. An additional central
works council also existed on the Dutch
side, claiming exclusive rights to be
consulted in that country. “Working in
close co-operation with CMS in Germany,
we presented our clients with scenarios
that would hold up in court, if necessary,”
says van Kranenburg.
Because the venture’s financial future
was uncertain, a key element was the
establishment of a shareholder-funded
severance package, payable to individual
MBO employees in certain circumstances.
A combined CMS team, involving
both employment and
insolvency specialists,
helped negotiate an
agreement that
was acceptable to
all stakeholders.
“The severance
package was an
important safety
net, required
for the MBO to
take place,” van
Kranenburg says.
Chambers Europe 2011: Employment & Pensions – France
• Band 1: This highly esteemed French outfit (CMS) houses one of the leading
employment departments in the country. The size of the team, coupled
with the various specialisations of the lawyers, enables it to handle some
of the most complex work in the area.
A ke y e l e m e n t
w a s t h e
e s t a b l i s h m e n t o f
a s h a r e h o l d e r-
f u n d e d s e v e r a n c e
p a c k a g e
http://eguides.cmslegal.com/pensions
CMS International
Guide to Pensions
PUBLICATIONSi
22. Smart transmission
networksInvestment in Europe’s energy infrastructure is essential.
CMS supported the creation of an industry first in this area
E
lectricity transmission companies across
Europe are upgrading their networks
to cope with the growing expansion
in renewable power generation. But many
encounter the same problem. Most sources
of renewable energy are in remote locations
far from conventional power stations, so how
can they be connected to their country’s major
population centres?
CMS has played its part in recent innovations.
Rather than building a major new electricity
transmission link over land, CMS advised on
a pioneering initiative to develop a seabed-
based alternative.
CMS’ role in the deal was to advise NGET/SPT
Upgrades Limited on procurement for a
project called the Western High Voltage Direct
Current (HVDC) Link. NGET/SPT Upgrades, the
project sponsor, is a joint venture between
two of the UK’s main electricity transmission
companies – ScottishPower and National Grid.
The tie-up between the two big names was
established to deliver the €1 billion, 2.2GW
project. It will be the longest 2.2GW HVDC
cable in the world at 420km.
CMS’ work on the deal was led from London,
supported by CMS in Germany and Italy, and
drew on a large range of expertise. Lawyers
from the Energy, Projects, Construction
and Planning teams were involved,
while Corporate, Procurement, Banking,
Environment, Health Safety and Oil Gas
also played a part. The cable is expected to be
fully operational in 2016.
Robert Lane, the CMS Energy Head who led
the project, says: “The Western HVDC Link
project is a first. It is tremendous to be a part
of this, addressing not only the UK’s energy
needs, but also climate change. The project
will also serve as the model for other sub-sea
solutions and will be a helpful precedent for
the ‘North Sea Grid’.”
Reporta-se não só às necessidades de energia do
Reina Unido, mas também às alterações climáticas
energy
20 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
“It’s addressing not only the UK’s energy needs, but also climate change”
23. 30 seconds with:
Mónica Carneiro
Pacheco
CMS in Lisbon
Comment
Helping market leaders
enter new territories
Penelope Warne,
Energy Partner
CMS has many years of experience
helping its oil and gas clients enter
new markets worldwide. Perhaps
the most high-profile new market
we have advised on recently is
Iraq, where we helped BP and
Eni, as well as a number of smaller
companies, to get established.
In Africa, we also acted for one
of Europe’s leading energy
companies on the development of
the Reggane Nord gas field in the
Algerian Sahara.
Advice is tailored to the specific
target country. In places such as
Iraq, political sensitivities over
ownership of oil and gas reserves
mean that petroleum operations
are governed by technical
services contracts (TSCs) rather
than licences, concessions or
production sharing arrangements.
Under a TSC, the oil companies
provide the up-front capital
to develop the infrastructure
necessary for production and,
if successful, can recover those
costs with a fee. However, under
a concession agreement, the
ownership of energy assets may
pass to the concession holder.
Besides acting for major oil
and gas companies on their
international investments,
CMS also acts for major services
companies in this sector. Our
Algerian team led by Samir Sayah
regularly advises clients, such as
Schlumberger, Baker Hughes
and Halliburton.
The diverse nature of our client
matters show the real strength
and depth of CMS’ oil and gas
capabilities. That is one reason
why guides to the world’s legal
professions, such as Chambers
and The Legal 500, consistently
rate our lawyers’ reputation for
oil and gas work, whether they
are based in Algeria, Scotland,
Poland or Portugal.
What’s the most significant case you
have ever handled?
An agreement between a client and the
Portuguese State that involved issues
arising from a time when the State
nationalised the company.
What matter are you most proud of?
Assisting a client on an important project
in the renewables sector.
If you could change one law,
what would it be?
I would reformulate the laws concerning
Portugal’s renewables sector.
If you weren’t a lawyer,
what would you be?
I would be a surgeon.
energy
21
In late 2011, CMS advised asset
management company LUXCARA
GmbH on a deal to acquire and finance
a substantial stake in Germany’s Briest
solar park. The 91MWp, €200 million solar
power station is one of Europe’s largest.
The deal saw LUXCARA acquire two
out of three of the park’s sub-sites,
which it will manage on behalf of the
FLAVEO SA, SICA-FIS fund. Acquisition
finance was provided by HSH Nordbank
AG and NORD/LB.
A CMS team, led by Energy Partners Holger
Kraft and Marc Riede, advised LUXCARA
on all aspects of the deal’s acquisition and
financing. Advice was also given in relation
to the project’s legal restructuring,
in particular its real estate agreements.
Kraft comments: “This deal was complex
for several reasons. The park’s original
builder became insolvent shortly before
financial close. Also, the investors’ assets
were physically connected to those
of another via shared infrastructure.”
CMS in solar park success
CMS in France has helped the French State
on its first successful tender to develop
large-scale offshore wind farms. When
they come into service in 2015, the five new
wind farms will each generate between
500MW and 750MW of electricity.
A multidisciplinary CMS team helped the French
ministries for the economy and energy draft the
initial tender documents. In selecting CMS, the
ministries singled out our EU-wide expertise in
the offshore wind sector, as well as our strength
in French banking, public and energy law.
CMS’ advisory role involved ensuring that
the tender documents were robust against
potential legal challenges, for example,
in relation to environmental law, while
remaining financially viable. “Long-term
investments are currently deemed very risky,
because of frequent changes of law,” explains
Paris-based Public Law and Energy Partner,
Christophe Barthélemy, who led the team.
Besides helping with the draft tender
document, CMS also advised the ministries
on which existing regulations should be
changed – again to improve the project’s
legal and financial viability. “We suggested
several rules should be changed, including
rules governing access to France’s high-
voltage electricity grid,” Barthélemy adds.
Assisting Barthélemy and Gérard Kling was
structured finance lawyer Gregory Benteux
and public law specialists Céline Cloché-
Dubois and Aurore-Emmanuelle Rubio.
Acting for the French State in wind farm first
24. Return to vendor
Despite challenges in the world’s economies, there are still
deals to be done in the hotels and leisure sector. CMS has
an impressive array of clients in this market and advises
banks and hotel chains
C
MS is known for having a substantial
banking sector client base. We also
have a Europe-wide reputation for
representing clients in the hotels and leisure
industry. So, when longstanding client
The Royal Bank of Scotland Group (RBS)
announced large-scale disposals in the hotels
and leisure sectors, it turned to CMS.
Like many recent sizeable disposals in this
sector, the RBS deal was prompted by the
credit crunch. All across Europe, banks have
been divesting their non-core assets – even
those performing well – in order to bolster
their balance sheets. In one of RBS’ most
significant disposals, CMS helped the 82%
state-owned bank sell a 918-strong pub chain,
known as the Galaxy Pub Estate. The deal was
worth £422 million.
One of the more unusual aspects of RBS’
Galaxy Pub Estate disposal, which completed
in December 2011, was that it involved RBS
selling the business to its original owners.
RBS had originally acquired the pub estate –
which largely consists of freehold properties –
in 1999 from UK brewery chain Scottish
Newcastle (SN). RBS had then contracted
back the chain’s property management
and beer supply to SN. However, in the
intervening years, SN, in turn, had been
acquired by the Amsterdam-based global
brewing giant, Heineken. It was to Heineken
that RBS sold its Galaxy Pub Estate business
in this transaction.
“The size and complexity of Galaxy’s portfolio
made this deal a challenge to advise on.
However, the fact that SN were already
operating out of the premises that were
to be disposed of undoubtedly helped the
transaction to progress as smoothly as
possible,” comments CMS Corporate Partner
Louise Wallace, who led the deal. “This,
together with the preparation undertaken
prior to the sale, helped the whole transaction
complete in just two weeks – which is a
remarkably quick timeframe for a deal of
its size.”
22 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
hotels leisure
Award wins and
deal recognitions
• Hotels Leisure –
Chambers UK, Band 1, London
• Hotels Leisure –
Legal 500 UK, Band 1
25. A significant trend in the hotel sector
has been the sale and leaseback – or
manage-back – of hotel chains’ property
assets. This trend has persisted in 2011, as
Accor continued with its €1.2 billion asset
disposal programme. Last year, our French
team advised the company on two Paris-
based sale and manage-back transactions
– one worth €105 million for the Pullman
Bercy hotel and another worth €69 million
for the hotel Sofitel Arc de Triomphe. Each
deal was advised on by Paris-based CMS
Corporate Partner Jean-Robert Bousquet,
assisted by Jean-Cécile Sommelet and
Jean-Charles Daguin.
For hotel chains, there are advantages
to this type of deal. In these latest
transactions, the buyers paid Accor for
the properties and business and Accor
agreed to manage them on a long-term
basis, ensuring steady cash flows for all
parties. Accor also received a commitment
from the hotels’ new owners that they
would carry out substantial renovations
at their own expense. From Accor’s point
of view, it meant it could manage the
“Distress-driven transactions have
been a key feature of this year’s
workload,” says CMS Hotels Leisure
Head, Rome-based Marco Casasole.
“CMS has acted in several deals of this
type in the hotel and leisure sector
during the past 12 months.”
The pros and cons of hotel ownership –
management splits
The secret of distress success
hotels in a less capital-intensive way.
However, as another matter involving
CMS in 2011 highlights, separating out
hotel ownership and management does
not always result in a happy working
relationship between the two parties.
During 2011, CMS was asked by
InterContinental Hotels Group (IHG)
to help it resolve a dispute with the then
leaseholder of two of its German hotels,
Neue Dorint GmbH. The relationship had
broken down to such an extent that, in
March 2011, IHG had pulled out of the two
hotels managed by Neue Dorint in Berlin
and Duesseldorf.
A CMS team led by Corporate Partner
Gerd Leutner was able to negotiate IHG’s
return to the two hotels, by working
with both properties’ owners – Union
Investment Real Estate GmbH in Berlin
and DKÖ Objektgesellschaft Königsallee
Dr. Herbert Ebertz KG in Duesseldorf.
Three months after CMS had resolved the
issue, the IHG flag was once again flying
over both hotels.
Distress-driven
transactions have been
a key feature this year
What matter are you most proud of?
We got to know Invesco Real Estate through
the work of several CMS offices for Accor
across a number of jurisdictions. Although
they were on the other side of the Accor deals
at that time, Invesco subsequently chose CMS
as its preferred legal adviser.
Tell us something interesting
about yourself
For almost a year I was a second lieutenant in
the Carabinieri, the Italian military police.
Although the training at the military academy
was a bit of a shock, I have to admit it was
quite an experience – and I was fitter than
I have ever been before or since.
If you weren’t a lawyer,
what would you be?
My home town is less than 30 minutes’ drive
from where Ferrari, Maserati and Lamborghini
are created, so I’ve always been quite fond
of motors. I think that I might have made a
good car designer or mechanical engineer.
This would, of course, depend on being able
to grasp the maths required for the job.
30 seconds with:
M arco Cas as o l e
CMS in Rome
One of the most significant matters
of this type in 2011 involved CMS
advising The Royal Bank of Scotland
plc (RBS) on the sale of a 42-strong
hotel portfolio that was operated by
Marriott Hotels. Banking giant RBS
had taken effective control of the hotel
portfolio in June 2011 after its previous
owners, a British Virgin Islands-based
holding company, had gone into
administrative receivership.
A CMS team led by Hotels Leisure
Partner Tom Page has now spent almost
a year planning and implementing
a sales process that will help the
administrative receivers and RBS
find a buyer for the Marriott hotel
portfolio. An announcement on this
is expected shortly.
Invesco ha scelto CMS
come consulente legale
“Invesco chose CMS as its preferred
legal adviser”
hotels leisure
23
26. infrastructure project finance
24 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
Upgrading Europe’s infrastructure requires money,
innovative thinking and technical expertise. The market
for public-private partnerships (PPPs) and private finance
initiatives (PFIs) remains dynamic. Our projects team
works across this sector, advising financiers, project
companies and government institutions
CMS advised private sector financiers
and the European Investment Bank
(EIB) on a €410 million PPP project to
widen the A8 motorway in Germany.
This 58km scheme was named one of
the EU’s key Trans-European Transport
Network projects.
Our team advised UniCredit and BBVA
as arrangers to the deal. The project
was granted up to €250 million of EIB
funding to ensure its financial viability.
The payment model used is unusual.
The road is financed by tolls on heavy
goods vehicles, making the project’s
income stream unpredictable. Part of
this risk was absorbed by the EIB, which
granted what is known as an LGTT
Guarantee Facility, in addition to
its structured finance facility.
In Germany, road tolls are collected
by a body called Toll Collect,
which passes the money to
relevant local authorities.
They pay toll receipts to
the concession company,
which funds road-
widening work and
pays for debt service.
The deal was named
the Deal of the Year
2011 award by Project
Finance magazine.
“This model is being rolled out
to similar projects,” says CMS Partner
Marc Riede, who led the finance team.
On the fast track
to toll road success Thanks to a deal advised on by CMS, the
North Sea is proving to be an important
source of renewable energy in the form
of wind-generated electricity.
In 2011, CMS helped a consortium
of investors to build an offshore wind
farm 180km north-west of the German
coastal town of Bremerhaven. The
€1.7 billion 400MW scheme is due to
go live in 2013 and will be capable of
powering 445,000 homes.
CMS advised the consortium company
Global Tech I on all aspects of the project,
including its financing, the contracts
for the supply and installation of the 80
wind turbines, the construction of an
offshore transformer station, as well
as the associated service and
maintenance agreement.
As one of the first commercial offshore
windfarms in the German North Sea to
have secured bank financing, this project
will prove to be a benchmark transaction
for future financing in this field. It also
won the PFI Wind Deal of the Year
award for 2011 from the trade journal
Project Finance International.
The CMS team that worked with Global
Tech I included advisers specialising in
banking and finance, led by Marc Riede,
as well as those specialising in projects
and public law, headed by Holger Kraft.
Another first in offshore wind
D e a l o f
t h e Ye a r
2 011
CM S a d v i s e d
o n a € 410 m i l l i o n
d e a l t o w i d e n t h e
A 8 m o t o r w a y i n
G e r m a n y
27. infrastructure project finance
25
Further co-operation between the
TMT and the IPF sector groups has led
to CMS’ first instruction on a satellite
PPP. Joanne Wheeler, Jonathan
Dames and Paul Smith are leading a
London-based team advising Com
Dev, the manufacturer of space
hardware, on a PPP study with the
European Space Agency to develop
further a satellite-based Automatic
Identification System. This new
system is for the long-range tracking
of shipping, using existing on-board
collision avoidance and navigational
aid systems.
CMS has also hosted a full-day
conference attended by British
government ministers and key players
from the satellite industry and the City
of London. The discussion throughout
the day was around easing the terms
of financing for satellite transactions.
The keynote speaker, Lord Green, the
UK Minister of State for Trade and
Investment, spoke of the necessity
for clear government support
and the need to get hi-tech
developments to the market
earlier, which was widely
reported by the media.
Meanwhile, John Snowdon
of Britain’s export credit
agency, UK Export Finance
(UKEF), told the industry
participants and funders
that UKEF was ready,
willing and able to provide
credit support to satellite
financing transactions.
As PFI and PPP projects become common
across Europe, there is an increasing trend
to restructure and refinance portfolios.
Over the past 12 months, CMS has
been active in this market, acting on
numerous transactions by investment
funds acquiring stakes in existing PFI/
PPP projects, as well as for the banks
providing finance to those funds. In a
single transaction, worth about £1 billion,
we helped refinance a substantial projects
portfolio, which included a large number
of PFI/PPP projects.
PPPs in space Acquiring and financing PFI/PPP portfolios
“Because these transactions are relatively
complex, it is not unusual for deals of this
type to take several months to negotiate,”
says Infrastructure Project Finance
Partner Andrew Ivison. “The challenge
for the year ahead is identifying the
sources of funding, not only for MA
activity in the projects and infrastructure
sector, but also for ‘greenfield
transactions’, too, as banks continue to
retrench or exit the market completely.”
T h e t r e n d i s
t o r e s t r u c t u r e a n d
r e f i n a n c e t h o s e
P F I a n d P P P
p r o j e c t s t h a t a r e
m o r e m a t u r e
O n e
t r a n s a c t i o n
w a s w o r t h
£1 b i l l i o n
T h e 4 0 0 M W
s c h e m e
s h o u l d p o w e r
4 4 5 , 0 0 0 h o m e s
b y 2 013
CM S h o s t e d a
c o n f e r e n c e w i t h
g o v e r n m e n t
m i n i s t e r s a n d
i n d u s t r y
p l a y e r s
CM S h a s
b e e n a c t i v e
i n t h i s
m a r k e t
28. “Our track record in longevity risk transfer,
together with the expertise of our Derivatives,
Pensions and Regulatory teams, means
we are ideally placed to help clients in this
fast-growing market,” adds James Parker,
the Partner who led the CMS team on the
Rolls-Royce deal.
Helping JLT to reshape its
European network
CMS’ cross-border capabilities were
highlighted when we advised
longstanding client Jardine Lloyd Thompson
(JLT) on a deal to reshape its European
operations in 2011. JLT, Europe’s leading
independent insurance broker, instructed
CMS on a deal to spin off its Italian business
into a joint venture with Marine Aviation
SpA. JLT retained a 25% stake in the
new venture.
CMS’ insurance expertise has helped clients expand internationally,
reshape existing operations and handle the challenges and
insurance risks of an ageing population
Managing pensions and longevity risk
Over the past year, CMS lawyers have played
a key role in helping insurers, reinsurers
and other financial institutions working in
the rapidly evolving pensions and longevity
de-risking market.
CMS teams have acted on three of the four
largest longevity deals in the UK market in
2011. We advised a major European reinsurer
backing a £1.7 billion longevity swap between
Credit Suisse and the pension scheme for
broadcaster ITV. Later in the year, CMS lawyers
from London and Paris helped international
reinsurer SCOR Global Life SE in its reinsurance
of a £3 billion longevity transaction between
Deutsche Bank and the Rolls-Royce UK
pension scheme. In mainland Europe, the
team was involved in the syndication of the
€12 billion longevity swap between Dutch
insurer Aegon and Deutsche Bank.
“With Solvency II on the radar for occupational
pension schemes across Europe, ever stronger
demand for longevity de-risking solutions looks
inevitable,” says Mike Munro, a Partner in CMS’
Financial Services and Products team who was
involved in the ITV and Aegon deals.
26 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
insurance
With Solvency II on the
radar, stronger demand
for longevity de-risking
solutions is inevitable
Covering the globe
29. The Italian deal was the second cross-border
transaction on which CMS had advised the
broking giant in the previous 12 months.
In 2010, CMS in London and Vienna helped
JLT on its collaboration to invest in the GrECo
Group, a Vienna-based pan-Central and
Eastern Europe (CEE) insurance broker.
The CMS team advising on JLT’s Italian
disposal and joint venture was led by
Rome-based Corporate Partner Marco
Casasole. The deal, along with its CEE
predecessor, was run in conjunction
with CMS in the UK. UK Partners
Ed Foss and John Cadman also advised.
Litigating over the fallout of the
Fortis collapse
It was one of the largest casualties of the credit
crunch – the failure of Fortis, previously one of
the world’s largest companies. The Benelux-
based insurance, banking and investment
management firm had to be rescued by the
Belgian, Dutch and Luxembourg governments
in 2008, following its ill-fated attempt to
jointly acquire ABN AMRO in unison with The
Royal Bank of Scotland and Banco Santander.
Now, CMS is acting on behalf of QBE, the
global directors’ and officers’ insurance
provider, in the claims-handling process
against Fortis and its former management.
According to Leonard Böhmer, the
Utrecht-based Insurance Partner who is
leading the CMS team acting for QBE, the
focus is now on the fallout from the recent
decision reached by the enterprise chamber
of the Dutch Court of Appeal. The Court
concluded that Fortis’ former directors and
managers had “mismanaged the company”
and “misrepresented the financial position
of Fortis at the time of the public offering of
shares to fund the takeover of ABN AMRO”.
“The decision of the enterprise chamber is
the first landmark of the dispute on the issues
of directors’ and officers’ liability,” Böhmer
explains. “All cases of this type start and
effectively end in this court. The decision will
serve as a guide for future court decisions on
the liability of both Fortis and the individual
directors and officers.”
CMS at the forefront of insurance
market consolidation
The insurance sector is one that has long
been ripe for consolidation and CMS has
been instrumental in recent moves by several
established insurers to increase their global
reach. In the past 12 months, lawyers from
across CMS have helped two major insurance
companies get established in Europe – one
from Japan and another from New Zealand.
A cross-border team advised new client Mitsui
Sumitomo, the seventh largest non-life insurer
in the world, on its entry into Germany, as
a prelude to a wider European expansion.
Leading the CMS team was Cologne-based
Insurance Regulatory Partner, Winfried
Schnepp, supported by a team in London and
Paris that included Partners Paul Edmondson,
Chris Southorn and Laurent Mion.
CMS advised on the acquisition by CBL
Insurance Limited, New Zealand’s largest
credit and financial surety insurer, of European
Insurance Services Limited, an underwriting
agency operating in the UK, France and Spain.
CMS in London and Paris advised on the deal,
which absorbed European Insurance Services’
offices in Tunbridge Wells (UK), Paris and
Madrid into CBL Insurance’s growing empire.
In both transactions, regulatory approval was
crucial and an important area on which CMS
advised. Whether acquiring existing insurance
companies or establishing in greenfield
locations, Europe’s insurance regulators want
assurances that the target companies’ new
owners are acceptable and have adequate
capital resources available.
“European insurance regulators are not just
looking for reassurance that new market
entrants meet existing capital requirements,
but also those required under the new
Solvency II Directive,” explains CMS’ Schnepp
who acted on the Mitsui Sumitomo deal.
CMS è stato
fondamentale nelle
scelte compiute da
società assicurative
affermate per
accrescere la loro
presenza sul mercato
“CMS has been instrumental in
moves by established insurers to
increase their global reach”
27
insurance
£3billion
The value of the longevity transaction
between Deutsche Bank and Rolls-Royce,
advised upon by CMS
30. intellectual property
Consistently
inconsistent
CMS in London. “Ideally, if a patent holder wins
a patent battle in one country, that ruling would
automatically be enforceable in every European
country where the patent infringement had
occurred. Unfortunately, that cannot happen
under the existing regime, except on an interim
basis. This is because each ‘European’ patent is
actually regarded as ‘national’ and each country’s
courts can only rule on the legality of that patent
in their own state.”
Beckett adds: “It would be helpful if a court in
a single European country was allowed to hear
and rule on whether a patent had been infringed
irrespective of where in Europe the alleged
infringement had occurred. But, again, this cannot
currently happen. This is because Europe’s patent
laws, while they are all based on the same general
principles, also have subtle differences that
a single ruling might not be able to reconcile.”
The CMS team insists that the creation of
a unified patent regime would make many of
these legal and logistical problems disappear.
The group acknowledges the effort being made
at a European level to bring about harmonisation.
“There are now proposals to standardise what can
and cannot be patented across Europe,” says
IP specialist Matthias Eck from CMS in Stuttgart.
“If this reform were implemented, it would
I
t is a question that is often on our clients’
minds, especially those in the technology and
pharmaceuticals sectors. When will Europe end
its internal squabbling and create a unified EU
patent?” explains Markus Deck, a CMS Intellectual
Property (IP) Partner from Duesseldorf. “The
topic also cropped up on a recent CMS visit to
our clients in Asia. They could not believe how
complex the European patent system is.”
The frustration felt by our clients in Asia about the
European patent regime is not unique – clients in
Europe also say the current system is difficult to
navigate. It has been possible to submit a single
application to register a patent simultaneously
in several EU states for some years. However,
the downside of this system is that it creates
a series of national patents, each governed by
the respective nation’s laws. Despite decades of
legal and political wrangling, there is no single,
overarching European patent. In addition, no one
European court has the power to make a definitive
pan-European ruling about a patent’s legality.
The members of the CMS patent litigation team
who deal with this reality on a daily basis say
the lack of a unified system in Europe is not just
a problem when initially registering patents.
It creates difficulty for European patent holders
trying to enforce their rights on a continent-wide
CMS helps clients navigate Europe’s patent laws
and protects their interests when involved in
cross-border disputes
basis. As high-profile spats between smartphone
and tablet manufactures have illustrated, cross-
border patent recognition and enforcement is of
central importance to many companies’ existence,
regardless of their business sector.
“In order to enforce their rights across Europe,
a patent holder must bring separate claims in each
EU state where they believe a patent infringement
is occurring, which can be very time-consuming
and expensive,” says Nick Beckett, IP Partner for
28 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
intellectual property
“Clients cannot believe how complex
the European patent system is”
Mandanten staunen
über die Komplexität
des europäischen
Patentsystems
31. remove the risk that courts in different EU
countries would come to different decisions about
whether a patent that has been granted under the
current system is valid under their national law.”
Until a single European patent system is in place,
companies have no option but to endure the
national differences that render cross-border
enforcement difficult, says London-based IP
Partner Jeremy Morton. “However, one of the
advantages of having 150 IP lawyers across
Europe is that CMS understands these national
differences and can advise our clients how best
to work within them.”
Jean-Guillaume Monin from CMS in Lyon adds:
“Experience tells us that it can take more than
20 months for the Patent Court in Paris to rule on
a patent dispute and about 17 months in the UK.
However, patentees have a higher success rate
when enforcing their rights in France compared
with the UK – about 35% versus 10%. In France,
the patentee success rate is even better if we only
take into consideration infringement proceedings
based on a European patent.”
“By having access to this kind of market
intelligence, our patent litigation team can advise
clients involved in cross-border patent disputes
when – and in which country – it is advisable to
start their claim,” Monin concludes.
What’s the most significant case
you have ever handled?
We represent a satellite operator being
sued by the copyright owners of television
programmes viewed using a satellite dish
and a decoder. Our client does not want
to pay royalties, because the broadcasting
organisations have already paid them.
The broadcasting organisations no longer
broadcast the content themselves, but
they still pay for the act of broadcasting.
Satellite operators or cable operators
should not pay what the broadcasters have
already paid. After referral to the Court
of Justice of the EU, the case is pending
before the Brussels Court of Appeal.
What matter are you most proud of?
We won a case for the ‘.eu’ domain
registry against a Chinese individual who
registered 10,000 domain names in bad
faith. Rather than forcing the organisations
or individuals to claim the transfer of
their domain name or leave their rights
infringed, one court order demanded the
release of the domain names.
If you could change one law,
what would it be?
I would change the Belgian Distribution
Act of 1961. It provides too much
protection for a distributor whose
distribution agreement is terminated.
The Act lets a court decide how much
compensation is due to the distributor
on an agreement’s termination. It would
be better if a distributor were entitled to
compensation for a percentage of this
personal turnover for every five years the
distribution agreement has lasted.
30 seconds with:
To m H eremans
CMS in Brussels
I would change the
Belgian Distribution
Act of 1961
29
intellectual property
commenT
Tax: another
important factor in
the patent equation
Diogo Duarte de Oliveira,
CMS in Luxembourg
It is not only patent laws that vary
across Europe. The treatment of
patents from a tax perspective also
differs between countries.
To counter this lack of harmony at
a European level, one idea gaining
traction across the continent is the
concept of the ‘patent box’. A patent
box is a preferential tax regime for
patent profits. Such schemes are
intended to boost research and
development, while incentivising
companies to retain ownership of
the patents they create. The UK is the
latest EU state planning to introduce
such a scheme, following Ireland,
Luxembourg and Switzerland. As a
country with a patent box regime since
2008, Luxembourg’s experience in this
field suggests that this tax incentive
works. It may be because the scheme
is generous. In total, 80% of royalties,
damages and capital gains realised on
certain intellectual property (IP) rights
are exempt, creating an effective tax
rate of about 5%.
Unlike the proposed UK scheme, the
Luxembourg tax break offers reliefs
on other IP rights besides patents, such
as software copyrights. We believe
that this could make Luxembourg an
attractive location for international
lifesciences companies to base their
operations in the longer term.
32. lifesciences
30 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
T
akeda Pharmaceutical Company Limited
has a strong and longstanding relationship
with CMS. Even so, the work recently
undertaken by CMS for the Japan-based business
was remarkable for its sheer scale and reach.
CMS advised Takeda on its acquisition of Swiss-
headquartered Nycomed A/S last year in one
of the largest global lifesciences transactions
of 2011. The deal was worth €9.6 billion
and 70 jurisdictions were involved.
Recognition of the achievement soon followed.
The transaction was named private equity
deal of the year by the Financial Times and
mergermarket. CMS’ role was highly commended
at the 2012 Legal Business Awards.
CMS has subsequently been retained to act on
the integration of Takeda and Nycomed. “Being
asked to handle Takeda’s post-integration issues
was a true seal of client satisfaction,” says Sandra
Rafferty, the Corporate Partner who led the initial
deal. “It made sense. We had learnt a lot about
Nycomed through the due diligence process
that would be of relevance for integration and
Takeda was familiar with our team and working
practices. Of course, we were familiar with them.”
CMS’ wide geographical footprint, industry sector
expertise and cross-border integration have been
instrumental in securing the firm’s role in advising
Takeda. “We have a genuinely multidisciplinary
team advising Takeda, including lawyers from
numerous CMS offices,” adds Rafferty.
Patrick Sommer from CMS’ Zurich office is one
member of the team working on the integration
process, along with Pietro Cavasola from CMS
in Italy and Ralf Kurney of CMS in Germany.
Logistically, it also helped that CMS has a large
presence in Zurich, where Nycomed has its
main operation. CMS’ specific expertise in
pharmaceuticals regulation has also proved
key, especially during the integration phase.
CMS’ ongoing role advising on the integration
of Takeda and Nycomed requires legal skills
that complement those in evidence during
the main acquisition. During this process,
CMS won praise from Takeda for its ability to
negotiate effectively with the sellers, even within
tight constraints. By contrast, the integration
process is much more lengthy and will ensure
that CMS further deepens its relationship
with Takeda during 2012 and beyond.
CMS played a key role in one of the biggest global lifesciences
MA deals of 2011. Its work to integrate the two companies continues
A winning
combination
Takeda/Nycomed
was named
private equity
deal of the year
commenT
What is driving major deals
in the pharma sector?
David Butts, CMS in Sofia
33. lifesciences
31
What’s the most significant case you have
ever handled?
A price-fixing investigation – our client Bayer
Switzerland is being investigated by the Swiss
Competition Commission. An important case.
What matter are you most proud of?
Being part of the CMS team working on Takeda’s
acquistion of Nycomed A/S. We showed we were
the right choice to handle such a complex,
multi-jurisdictional matter.
If you could change one law,
what would it be?
Patent laws in Europe make life difficult for
innovative companies, especially lifesciences
clients. The process must be simplified.
Tell us something interesting about yourself
I was the General Counsel at Holcim, a global
company based in Switzerland. It made me see
how lawyers can make clients’ lives easier.
30 seconds with:
Patrick S o mm er
CMS in Zurich
Lifesciences remains one of the prime industries
for global MA activity, with Takeda’s
acquisition of Nycomed being just one example
of a spate of deals in this sector.
Several factors are driving this trend. Established
pharmaceutical companies are focusing their
MA activity on emerging markets, where their
portfolios may be too weak to take advantage
of anticipated growth – principally in the BRIC
countries and Turkey, but also in the rest of Asia
and south-east Europe. Several companies also
face a ‘patent cliff,’ with their patents on major
‘blockbuster’ drugs about to expire. Moreover,
low RD productivity has resulted in diminished
pipelines of new drugs in development, driving
large companies to acquire promising small or
start-up competitors to maintain or enhance
their portfolios. Finally, a desire to diversify
established product lines may also drive MA.
The growing role of private equity investment
as a driver of deal activity in the pharmaceutical
sector is worth noting. In Europe, total private
equity investment increased from €3.4 billion
in 2009 to €5.7 billion in 2010, says the European
Private Equity and Venture Capital Association.
On the disposals side, private equity houses play
a crucial role in MA. Before being acquired by
Takeda, Nycomed was owned by a consortium
of private equity houses, including Nordic
Capital and Credit Suisse.
Since CMS is a leading adviser in Europe in
the pharmaceuticals market, such trends
vindicate our creation of a 50-strong dedicated
Lifesciences team, working across national
borders and legal specialisms. The team works
closely with lawyers from other CMS disciplines,
such as private equity and consumer products,
offering a ‘one-stop shop’. Whether advising
companies on the acquisition of start-ups or
multinational competitors, our experience
illustrates our understanding of this sector and
how we help clients meet strategic objectives.
34. I
nvolvement in one of the largest private equity
deals in Central and Eastern Europe (CEE) is
bound to present logistical challenges. When
acting for a potential purchaser in a competitive
bid situation, things are rarely straightforward.
But, CMS could never have anticipated the last-
minute hurdle it encountered when acting
for Advent International on its 2011 bid to buy
Provimi Pet Food from the Provimi Group.
Provimi Pet Food is the third largest producer of
private label wet and dry pet food in Europe. The
deal had an enterprise value of €188 million. CMS
had been working for Advent for almost seven
months, advising on acquisition and financing.
There were few problems beyond co-ordinating
a 130-strong legal team across nine CMS offices.
Then, an unexpected corporate reshuffle at
Provimi Group meant a key document had to
be stamped by a Russian notary for the sale to
proceed. It became clear that, with fewer than
24 hours to go before the deal deadline, the
notary lined up by the sellers could no longer carry
out his duties. No notaries were available due to
a day-long Russian notaries’ annual convention.
”Thanks to the efforts of the Moscow office,
especially Partners Maxim Boulba and David
Cranfield, we fixed the problem,” says
International Private Equity Partner Graham
Conlon, who led the deal. ”In 24 hours, we
managed to persuade a notary to leave the
convention to stamp the document to meet the
noon deadline in London. It was very close – the
document was stamped with less than a minute to
spare. Our lawyers had spent the morning rushing
around Moscow, getting paperwork in place.”
A key ingredient was the deal’s ability to
attract funding. Prague-based Partner Ana
Radnev led this part of the deal, helping Advent
negotiate with the banks that helped finance
the transaction. “This was a great example of
CMS’ banking and corporate lawyers working
together,” she says.
Chris Mruck, Advent’s Managing Partner,
has praised CMS for its cross-border expertise.
He says: ”This was a complex multi-country
acquisition and I was pleased with CMS’ ability
to provide a seamless one-stop-shop service
across jurisdictions and practice areas.‘
CMS’ local market knowledge helps clients
advising private equity investors in semi-mature
markets. Conlon adds: ”Our lawyers understand
local practices and give our clients commercially
pragmatic advice, while safeguarding interests.”
T h e d o c u m e n t
w a s s t a m p e d
w i t h l e s s t h a n
a m i n u t e t o s p a r e
b e f o r e t h e n o o n
d e a d l i n e
Czech Republic, France, Hungary, the
Netherlands, Poland, Russia, Slovakia
other offices
involved in this deal
CMS’ speed, efficiency and local know-how was put
to the test in a recent deal to buy a pet food firm
Tracking
down
local
expertise
32 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
private e q uity
35. private e q uity
33
The European Union’s (EU’s) Alternative
Investment Fund Managers Directive
(AIFMD) comes into force at national
level in 2013. Those affected should be
preparing now.
EU managers affected by AIFMD can
apply to their national regulator to be
authorised from July 2013 and must
obtain authorisation before July 2014.
Authorisation is compulsory if EU-based
managers are involved in promoting or
operating an Alternative Investment
Fund (AIF) – typically, those holding
private equity, hedge and real estate
underlying investments. Authorisation
is conditional upon factors such as
capital requirements, compliance with
AIFMD’s operational requirements and
engagement of a depositary for each
AIF. Custodian banks are expected
to operate as depositaries, but the
depositary must be independent of the
Alternative Investment Fund Manager
(AIFM) of the AIF.
Non-EU managers can continue to
market AIFs in the EU under existing
private placement rules, subject
to certain requirements. Managers
outside the EU should also be able to use
a passporting regime from 2015. The EU
may abolish private placements in 2018.
Despite the compliance burden, from
2013, EU-based AIFMs will be entitled
to manage funds throughout the EU
without complying with different
nationality requirements. They will be
entitled to passport the marketing of
EU funds to professional investors in the
EU and may be allowed to market the
AIFs to retail investors under national
law. The equivalent benefit should
apply to non-EU managers marketing
to EU investors under the third-country
passporting regime scheduled for 2015.
AIFMs should exploit opportunities, but
address investors’ concern that erosion
of investment returns due to compliance
with AIFMD is kept to a minimum.
The buyer and the
seller refused to talk
to or see each other
commenT
Authorised to invest
Melville Rodrigues, CMS in London
What’s the most significant case you
have ever handled?
A complex private equity deal that involved
a privatisation, a refinancing of 40 leisure
resorts, a management package that involved
100 managers, as well as an antitrust clearance
in many countries across Europe.
What matter are you most proud of?
Having closed a deal after nine months of
negotiation, during which the buyer and the
seller refused to talk to or see each other.
It didn’t help that both individuals were equal
partners in the target company.
If you could change one law,
what would it be?
I would change the French Civil Code to secure
the enforceability of put and call options.
30 seconds with:
Chris to phe
Bl o nd eau
CMS in Paris
€188
million
The enterprise value of the
Provimi Pet Food deal
36. real estate construction
34 C M S A N N U A L R E V I E W 2 0 11 – 2 0 12
T
he push to cut Europe’s carbon emissions
is putting pressure on the real estate
sector to improve new buildings’ energy
efficiency. But, as CMS recently discovered,
the use of ‘green clauses’ is growing, despite
a patchwork of regulations and market practices
across the continent. This is because their use
is key to safeguard the value of real estate
investments in the long term.
Recently, CMS has taken steps to help
property owners, users, investors and asset
managers by producing a new e-guide, the
CMS Study on the Use of Green Lease Clauses
in Europe. Combining market intelligence
from 21 countries, the study is a useful tool for
comparing regulations and practices in different
states. The guide includes recommendations on
drafting green leases.
Explaining the thinking behind the guide,
Stuttgart-based Real Estate Partner Dirk
Rodewoldt says: “With so much focus on
green buildings, we wanted to find out what
was being done across Europe, identifying
best practice.”
His Amsterdam-based colleague Arnout
Scholten adds: “Environmentally friendly and
sustainable buildings are starting to become
the norm across Europe, as the continent aims
to meet its Kyoto Protocol targets. So, ensuring
buildings stay green during their entire lifetime
is essential to future-proof investments.”
When making purchasing decisions, property
investors can now rely on energy certificates,
an important new requirement in this area.
However, as CMS found when researching the
guide, not all Europe’s energy certificates are
directly comparable. “This can be confusing both
to investors and users alike,” says Brussels-based
CMS Partner Bruno Duquesne. He believes
that, in future, certification standards should
be harmonised across the continent for both
new and existing properties. “This development
would be beneficial to the real estate industry
across Europe,” Duquesne concludes.
The CMS e-guide: Study on the use of Green Lease Clauses in Europe can be downloaded
at http://eguides.cmslegal.com/greenleases
We wilden nagaan
wat er gedaan werd
in Europa, om best
practices te identificeren
“We wanted to find out what was
being done across Europe, identifying
best practice”
CMS’ real estate expertise is guiding clients through environmental legislation, letting
them make informed purchasing decisions – and has helped Poland’s football squad
Navigating the
green lease minefield
