Acquisition International April 2012

April 2012 /

In this Issue/

6

DEAL GURU:

8

SECTOR TALK:

Technology Turnaround Health Care Deals

26 SECTOR SPOTLIGHT:

Corporate Immigration Review

INTERNATIONAL ARBITRATION

DOING BUSINESS IN SERBIA

— Acquisition International speaks to ČAKMAKOVA Advocates / 11

AI 2012 Q1 REVIEW

www. ACQUISITION-INTL .com

— The biggest improvements to the business environment in Eastern Europe / 12

— A strong start for the Oil, Gas and IT Service industries / 30

CONTENTS: April 2012

Editors Comment Despite generally favourable conditions for global M&A activity, Q1 registered the lowest announced dollar volume in the past two and half year, with the global transaction count dropping 5.7%, while dollar volume

CONTENTS — April 2012

declined 15.7%. Europe’s M&A activity followed suit lagging in March, with deal total dropping 31.5% to 756.

From the domestic front year to date in the U.K., the deal count fell 17.2% to 674, as both domestic and cross-border transactions experienced declines in excess of 10%.

From January to March, M&A activity in Germany declined slightly from last year, with deal count decreasing by 3.4% to 394, and dollar volume slipped 3.7% to $15.8 billion.

M&A metrics in Asia (ex. Japan) softened during March following a firm February. The number of deals contracted 16.1% to 460. Through the first three months of the year, the deal count in China contracted 21.3% to 532, as domestic, inbound, and outbound transactions all

ON THE COVER - INTERNATIONAL ARBITRATION: /11

Acquisition International speaks to ČAKMAKOVA Advocates about Arbitration in Macedonia.

experienced decreases. Dollar volume slid 26.3% to $25.7 billion.

M&A activity was mixed in India through the first three months of the year. The deal count was down 3.9% to 221, despite a 25.0% increase in domestic transactions.

During the first quarter of 2012, the deal count in Japan

NEWS: /04

The Latest News stories from around the world.

climbed 21.8% to 733, with strong gains in both domestic

SECTOR SPOTLIGHT: /25

Resolving Disputes in the Construction Industry

and cross-border transactions. Dollar volume jumped 23.6% to $30.9 billion, led by outbound volume growth of over 40%.

DEAL GURU: /06

This month, Acquisition International speaks to the deal makers who are still getting the deals done, the experts

Technology Turnaround

form their specialist fields, ranging from due diligence to attracting FDI and let’s not forget the numerous country review discussing the current business environment.

Enjoy the Issue, Charlotte Abbott, Editor charlotte.abbott@acquisition-intl.com

SECTOR TALK: /08

Healthcare Deals Powered by Prequin.

How to get in touch AI welcomes news and views from it’s readers.

Corrospondence should be sent to; Address/ Acquisition International, Blakenhall Park, Barton under Needwood, Burton on Trent, DE13 8AJ. Tel/ 0844 809 4788 Email/ reception@acquisition-intl.com Website/ www.acquisition-intl.com

ADVISER MAP: /56 Contacts from around the world.

DEAL DIARY: /57

Find us on/ @acquisition-int Publication Production by Tabias Ltd.

ACQUISITION INTERNATIONAL

The Latest Acquisitions from around The World.

Doing Business in Serbia Doing Business in Slovakia Doing Business in Belarus Doing Business in Latvia Doing Business in Slovenia Doing Business in Lithuania Relocation, Relocation, Relocation Resolving Disputes Corporate Immigration Review The Future for Corporate Disputes Cross Border Inv. Opportunities Business Crime AI 2012 Q1 Review Doing Business in Finland Doing Business in Denmark Doing Business in Iceland Getting Started in Franchising Creating Value out of Due Diligence Enhancing the Flow of FDI Why Arbitrate in Toronto?

Best Practice in Post Merger Intergration Best Practice in Post Acq Integration Doing Business in BVI Transfer Pricing A Guide to Insolvency & Restructuring

/12 /14 /15 /16 /19 /20 /21 /23 /26 /27 /28 /29 /30 /38 /39 /40 /42 /44 /46 /49 /50 /51 /52 /53 /55

April 2012 /

3

NEWS:

From Around the World

BUY AND BUILD ACTIVITY

— in Europe significantly weaker in H2 2011

London [28 February 2012] - Silverfleet Capital, in conjunction with mergermarket, today publishes the findings of its 2011 Buy & Build Monitor which show a significant slowdown in Buy & Build activity.

While overall 2011 saw Buy & Build activity increase both in volume and value terms, the number of addon transactions decreased considerably during the second half of the year slumping to levels last seen at the end of 2009. 2011 saw the highest number of addons undertaken by private equity-backed portfolio companies since 2008, at 364 (versus 335 in 2010).

However, despite a strong start to the year, with 210 add-ons undertaken in H1, the second half of the year saw activity levels decline significantly, with only 154 add-ons undertaken in H2.

In H1 the average value of add-ons was £70 million, which was the highest since we began tracking Buy & Build activity on a quarterly basis in Q1 2008, however in H2 this figure fell to £57 million, with Q4 seeing an average add-on value of only £34 million.

Commenting on the findings, Neil MacDougall, Managing Partner of Silverfleet Capital said: “The downward trend in Buy & Build activity we first observed in Q3 continued in Q4 and there is now clear empirical evidence of the negative impact that

the European sovereign debt crisis has had. We can only speculate on what the exact causes are, but we would expect that they include a drop in overall business confidence as well as the much tougher market for bank financing.”

“While Buy & Build strategies have been more difficult for European companies to pursue in recent months, private equity portfolio companies have of course several other ways to create value. For example, Office, a shoe retail company which we acquired in December 2010, has continued rollingout into new locations. In 2011 the company opened 8 new stores and 8 new concessions which on top of strong like-for-like growth contributed to a very healthy uplift in profitability.”

Buy & Build activity in the final quarter of 2011 continued to be weak both in terms of volumes (74 add-ons) and values (disclosed values were on average only £34 million). While we would expect as usual some upward revision of these numbers as further information emerges over the coming months, the trend is nevertheless clear if analysed on a quarterly rather than annual basis. For 2011, the number of add-ons undertaken by private equity-

backed portfolio companies reached a 3-year high of 364, versus 335 in 2010 and 236 in 2009. But, conversely, the Q4 level of add-ons was, at 74, only the same approximate level as the 75 add-ons that were completed in Q4 2009. In terms of the average disclosed value of add-ons, in Q1 2011 this was £92 million, falling to £50 million in Q2, £70 million in Q3 and then a very modest £34 million in Q4, the lowest level since Q2 2009.

As this new trend has now been consistent for the last two quarters the dichotomous nature of Buy & Build activity in 2011 is we believe best illustrated by the graph below which analyses the data by half years.

The level of Buy & Build activity had recently started to outstrip overall mid-market M& A in Europe but has now clearly fallen back in line. We suspect that the much tougher market for bank financing, often used wholly or partly by the acquiring entity to fund acquisitions, is probably a large part of the explanation for this development. In addition, it may be that with their existing banking covenants to bear in mind, management and buyout firms are taking a more cautious approach to corporate activity while the economic outlook for the Eurozone remains uncertain.

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NEWS:

From Around the World

POWER INTEGRATIONS

— Agrees to Acquire CT-Concept Technologie AG

Power Integrations (Nasdaq:POWI), the leader in high-voltage integrated circuits for energy-efficient power conversion, today announced that it has signed an agreement to acquire privately held CT-Concept Technologie AG (known as CONCEPT) for approximately 105 million Swiss francs in cash, or about US$115 million, net of cash assumed.

Founded in 1986 and based in Biel, Switzerland, CONCEPT is a developer of highly integrated, energy-efficient drivers for high-voltage IGBT modules. The company’s products are used in a range of high-voltage power-conversion applications including industrial motor drives, renewable energy generation, electric trains and trams, high-voltage DC transmission, electric cars and medical equipment.

CONCEPT employs approximately 65 people and holds 14 patents with additional patents pending.

Balu Balakrishnan, president and CEO of Power Integrations, commented:

Our strategic focus is to offer the most innovative high-voltage powerconversion products across an ever-wider range of power levels and applications. CONCEPT fits perfectly within this strategy.

Their innovative products bring integration, reliability and energy efficiency to very high-power applications—the same attributes we bring to lower-power applications.

ACQUISITION INTERNATIONAL

“CONCEPT’s addressable market, already approaching $500 million, continues to expand with the growth in renewable energy, electric vehicles and high-efficiency industrial motors, and the efficacy of these clean technologies depends on cost-effective, efficient, reliable power electronics like CONCEPT’s market-leading IGBT drivers.

These dynamics make CONCEPT an extremely attractive business and an exciting addition to our company.”

CONCEPT’s management team and employees will remain at the company’s Biel headquarters, which will become Power Integrations’ center of excellence for high-voltage driver design. Wolfgang Ademmer will continue as president of CONCEPT and will also become a vice president of Power Integrations, reporting directly to Mr. Balakrishnan.

Mr. Ademmer commented: “We are very pleased to become part of Power Integrations, a company that shares our singular focus on delivering the most innovative power-conversion products for our respective end markets.”

Power Integrations’ scale and vast customer base will help us accelerate the adoption of our products around the world. As part of Power Integrations, we can strengthen our unique position in the value chain providing innovative driver technology compatible with all major IGBT module manufacturers.

transaction to be immediately accretive to its nonGAAP gross margin, operating margin and earnings per share. The company expects the transaction to close during the second quarter of 2012.

In conjunction with its approval of this transaction, Power Integrations’ board of directors has cancelled the company’s previously announced $30 million share-repurchase authorisation.

Power Integrations management will conduct a conference call at 8:00 a.m. Pacific time today to discuss the transaction with members of the investment community.

The call can be accessed by dialing 1-877-303-9795 from the U.S. or 1-631-291-4581 from outside the U.S. A live and archived webcast of the call will be available via the investor page of the company’s website, http://investors.powerint.com.

Based on full-year 2011 results, Power Integrations estimates that the acquisition will add approximately 10 percent to its annual revenues, and expects the

April 2012 /

5

DEAL GURU:

Technology Turnaround

TECHNOLOGY — Turnaround

After some turbulent times two years ago, we are starting to see real growth in M&A activity in the technology sector. James Klein of Penningtons Solicitors LLP looks at the latest trends and what we can expect as confidence in the market returns.

Until the first quarter of 2009, deal activity for the technology sector had seen eight consecutive negative quarters. Since then, however, M&A activity has started to thrive again. According to recent Ernst & Young Global Technology M&A Updates, deal count during 2010 totalled 2,658 (up 41%), returning to levels last seen in 2008, with a total deal value of $119bn (up 26% on the previous year). During 2011 deal numbers have continued to grow.

The contribution made by British companies to these figures has been increasing. Britain ranked as the second most technology-acquisitive country in the world during 2010, eclipsed only by the US. During 2010, M&A activity in the UK technology sector rose by around 50%.

There has been a recent shift towards smaller, more strategically focused deals, particularly in the areas of smart mobile technology, software as a service (SaaS), internet and mobile video, cloud computing and social networking. The top 10 deals of Q1 2011 were dominated by smart mobility and cloud computing, although three semiconductor deals also featured. A cross-sector blur is evident, as new technologies cross traditional sector lines.

There has also been a change in deal dynamics. The top 25 companies in the sector command between

6

/ April 2012

them over $500bn of cash and investments, and we are seeing more pre-emptive deals, as buyers actively seek out strategic investments. As exit opportunities improve, we have also witnessed the return of private equity, with private equity deal value reaching $19.7bn in 2010, more than double the 2009 total ($9.8bn).

In the UK, an emerging trend is the increase in e-commerce transactions, with several high profile sales this year, (for example Amazon’s acquisition of Lovefilm). Larger overseas corporates are active: in May 2011 UK-based TweetDeck was bought by Twitter for £25 million, and Misys and MicroFocus, two of the UK’s biggest tech players, are both in discussions with potential purchasers.

Technology companies are capitalising on the wealth of innovation in the market, by using their cash reserves to broaden product portfolios and integrate capabilities to draw client spending. As cost-cutting measures have run their course, M&A often remains the only way to grow earnings in future markets.

Despite the optimism, both financial and strategic buyers should remember that thorough due diligence and timely integration planning are essential for a successful technology merger.

James Klein is a partner in Penningtons’ corporate team and a member of the firm’s technology sector group.

Company: Penningtons Name: James Klein Email: james.klein@penningtons.co.uk Web: www.penningtons.co.uk

ACQUISITION INTERNATIONAL

SECTOR TALK:

Health Care Deals

HEALTH CARE DEALS — Powered by

The healthcare sector comprises companies operating in areas including biomedical, biotechnology, life sciences, medical devices, medical instruments, medical technologies, pharmaceuticals, predictive medicine and other healthcare services. According to Preqin data, this sector has attracted over $236 billion worth of private equity investment from the period 2006 to present, with 1,651 deals recorded in this time.

NO. AND AGGREGATE VALUE OF PE-BACKED BUYOUT HEALTH CARE DEALS GLOBALLY

H1 2011 - H1 2012 YTD (as at 05/04/2012) Period

No. of Deals

Aggregate Value of Deals ($bn)

H1 2006 H2 2006 H1 2007 H2 2007 H1 2008 H2 2008 H1 2009 H2 2009 H1 2010 H2 2010 H1 2011 H2 2011 H1 2012

125 111 146 138 132 107 81 106 152 152 173 152 76

11.2 61.9 54.7 24.6 13.4 3.3 1.4 10.3 11.0 9.5 15.0 16.3 3.7

YTD (as at 07/03/2012)

The aggregate value of deals in the healthcare sector reached a peak in the second half of 2006, with 111 deals valued at $61.9billion. The onset of the financial crisis led to a considerable decrease in the typical size of deals taking place within the industry. A low point was reached in the first half of 2009 when 81 deals took place, valued at an aggregate $1.4 billion. Since this trough in deal value, the recovery has been gradual and levels have not returned to those seen prior to the downturn; since the collapse of Lehman Brothers, the half-year period with the greatest value of deals that took place was H2 2011, with 152 deals worth an aggregate $16.3 billion.

NUMBER OF PE-BACKED BUYOUT HEALTH CARE DEALS BY REGION

2006 - 2012 YTD (as at 05/04/2012)

Region

2006 2007

North America 153 Europe 64 Asia & ROW 19

172 87 25

2008 2009 2010 2011 2012 YTD 147 72 20

122 51 14

170 94 40

211 81 33

42 24 10

BREAKDOWN OF NUMBER OF PE-BACKED BUYOUT HEALTH CARE DEALS BY REGION

2006 - 2012 YTD (as at 05/04/2012) Region

2006 2007

North America 65% Europe 27% Asia & ROW 8% Source: Preqin

8

/ April 2012

61% 31% 9%

2008 2009 2010 2011 2012 YTD 62% 30% 8%

65% 27% 7%

56% 31% 13%

65% 25% 10%

55% 32% 13%

Unlike the trend seen in the amount of capital being used for deals in each half-year period, the number of deals taking place was not as greatly impacted by the onset of the financial crisis. Since the trough in H1 2009, the number of deals taking place rebounded to a new peak witnessed in the first half of 2011, with 173 deals recorded, in comparison to the previous peak witnessed in H1 2007 of 146 deals. It is apparent that deals in the healthcare sector have become more numerous, but are largely made up of small- and mid-cap deals in comparison to the large valued deals witnessed during 2006-2007. Looking at more recent data, so far in 2012 (to 5th April 2012), there have been 76 buyout deals witnessed across the healthcare industry globally, with an aggregate deal value of $3.7 billion.

ACQUISITION INTERNATIONAL

SECTOR TALK:

Health Care Deals

AGGREGATE VALUE ($BN) OF PE-BACKED BUYOUT HEALTH CARE DEALS BY REGION

2006 - 2012 (as at 05/04/2012) Region

2006

North America 53.6 Europe 16.4 Asia & ROW 3.1

2007

2008

2009

2010

2011

2012 YTD

45.7 33.2 0.4

9.5 6.2 0.9

8.0 3.1 0.6

10.6 6.8 3.1

24.8 4.7 1.8

1.0 2.2 0.5

Source: Preqin

NO. AND AGGREGATE VALUE ($BN) OF PE-BACKED HEALTH CARE DEALS BY TYPE

The regional breakdown of healthcare deals shows that North America appears to be the most attractive place for fund managers to deploy their capital into this industry. This region makes up over half of the total global deal volume this year, with Europe, and Asia and Rest of World representing 32% and 13% respectively. In terms of aggregate capital, Asia and Rest of World has seen the least amount of investment this year, $500 million. Europe has surpassed North America in terms of the aggregate value of healthcare deals taking place in the region, with Europe securing $2.2 billion of investment, whereas North America has only secured $1 billion.

Deals by Type: 2011 - 2012 YTD (as at 05/03/2012) Type

No. of Deals

Aggregate Deal Value

Add-on LBO Growth Capital Public to Private

133 193 56 17

9.5 7.2 0.9 17.4

Source: Preqin

In the healthcare industry, the most common type of deal is a bolt-on acquisition, with 48% of the total number of PE-backed buyout deals, representing 27% of deal value, between 2011 and 2012 YTD. On the other hand, leveraged buyouts (LBOs) have accounted for a lower proportion of deals by number (33%) over this period; however they have contributed 27% of aggregate deal value. Growth capital and public-to-private deals have contributed 14% and 4% of deal volume, respectively, over the same period. Though public-to-private deals accounted for just 4% of the number of deals that took place in 2011-2012 YTD, this deal type has contributed half of the aggregate value of deals globally. The top three healthcare deals have been recognized as public-to-private deals, which include the privatization of Kinetic Concepts

by Apax Partners, CPP Investment Board and Public Sector Pension Investment Board, the take-private deal of Pharmaceutical Product Development by Carlyle Group and Hellman & Friedman, as well as the privatization of Emergency Medical Services by Clayton Dubilier & Rice. These three acquisitions had a combined aggregate value of $13.4 billion.

THE 10 LARGEST PE-BACKED HEALTH CARE DEALS 2011 - 2012 YTD (AS AT 05/04/2012) Firm

Website

Investment Type

Deal Gate

Deal Size

Investors

Kinetic Concepts, Inc.

www.kci1.com

Public To Private

Jul-11

6,300.00 USD

Pharmaceutical Product Development, Inc. Emergency Medical Services Capsugel

www.ppdi.com

Public To Private

Oct-11

www.emsc.net

Public To Private

Feb-11

www.capsugel.com

Buyout

Apr-11

Kohlberg Kravis Roberts

Immucor, Inc.

www.immucor.com

Public To Private

Jul-11

HCA-HealthONE

www.healthonecares.com

Addon

Jun-11

3,900.00 USD 3,200.00 USD 2,375.00 USD 1,973.00 USD 1,450.00 USD

Apax Partners, CPP Investment Board, Public Sector Pension Investment Board Carlyle Group, Hellman & Friedman Clayton Dubilier & Rice -

The Priory Group

www.priorygroup.com

Buyout

Jan-11

Capio Spanish www.capiosanidad.es Hospitals China Biologic Products, www.chinabiologic.com Inc. Rural/Metro www.ruralmetro.com Corporation

ACQUISITION INTERNATIONAL

Buyout PIPE Public To Private

925.00 GBP Jan-11 900.00 EUR Dec-11 902.97 USD Mar-11 738.00 USD

Bought From/ Exiting Company

Primary Industry

Location

Medical Devices

US

Pharmaceuticals

US

Healthcare

US

Pfizer

Pharmaceuticals

US

TPG

-

US

Bain Capital, Citigroup, HCA, Kohlberg Kravis Roberts, Merrill Lynch Global Private Equity, Ridgemont Equity Partners Advent International

-

Medical Technologies Healthcare

Healthcare

UK

US

Healthcare

Spain

Warburg Pincus

RBS Asset Management Apax Partners, Nordic Capital -

Pharmaceuticals

China

Warburg Pincus

-

Healthcare

US

CVC Capital Partners

April 2012 /

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ON THE COVER:

Macedonia — A Location for Arbitration

MACEDONIA — A Location for Arbitration Acquisition International speaks to Mrs. Biljana Cakmakova, Managing Partner, Attorney at Law and Maja Jakimovska, Attorney at law at CAKMAKOVA Advocates Skopje, about why Macedonia is a location for International Arbitration. ČAKMAKOVA Advocates is a Macedonian advocates partnership founded and registered under the Macedonian Law on Advocacy, within the Macedonian Bar Association, which provides a full range of legal services to international and domestic corporate clients.

ČAKMAKOVA Advocates is composed of highly trained and experienced professional advocates, with licenses to practice law, each dedicated specifically to an area of the Law, to give the best legal assessment and assistance possible. The team of nine advocates, five associates and one administrative assistant is committed to excellence and providing the best service to the clients legal needs.

CAKMAKOVA Advocates practice covers all types of commercial cases before Macedonian courts and aims for effective dispute resolution while dealing complex cases with an international background.

CAKMAKOVA Advocates handles substantial disputes in diverse legal areas such as debt recovery and performance of commercial contracts, unfair competition, compensation of damages, infringement of intellectual property rights, employment relations and relations between companies and member of their bodies, protection of personal rights in particular in the area of economic crimes.

Our clients have come to depend and rely on the experienced and good judgment of legal advice to achieve their objectives. We are proud to say we have already assisted large and medium national and international companies with diverse fields of activities, such as EVN AG – Austria, EVN Macedonia AD Skopje, Mobilkom Austria AG – Austria and many other previous and current clients.

Mrs. Biljana Cakamakova, Mrs. Olivera Grozdanovska and Mrs. Vesna Gavriloska have been appointed as arbiters in disputes with both domestic and international elements which are lead before the Permanent Court of Arbitration within the Economic Chamber of Macedonia. Mrs. Cakmakova has been also elected as a member of the Presidency of Permanent Court of Arbitration within the Economic Chamber of Macedonia.

CAKMAKOVA ADVOCATES is dedicated to providing professional legal services to varieties of the clients, both domestic and international. The professional team of CAKMAKOVA Advocates has gained an extensive experience in its 17 years of existence.

WHAT IS YOUR CURRENT ARBITRATION CASELOAD AND WHERE IS THE SOURCE?

ACQUISITION INTERNATIONAL

“Even though the Permanent Court of Arbitration within the Economic Chamber of Macedonia has been established nearly 20 year ago, the arbitration has been used rarely by the interested parties as legal instrument for dispute resolution. This has been due to the lack of knowledge that such institution exists in Macedonia.

“However, since the beginning of 2011 the activities of the Permanent Court of Arbitration within the Economic Chamber of Macedonia for promotion of the arbitration as an instrument for out - of- court dispute resolution have been increased significantly.

Therefore we could expect for the number of cases resolved with arbitration to slowly, but surely increase in the following years.”

CAN YOU PLEASE EXPLAIN THE REGULATORY FRAMEWORKS IN PLACE WITHIN YOUR JURISDICTION THAT ALLOWS YOU TO ATTRACT INTERNATIONAL CASES? “The Permanent Court of Arbitration is competent for dispute resolution only if the parties agreed upon this solution. The parties may agree that the Permanent Court of Arbitration shall be competent for rights which the parties may freely dispose of and if the laws do not prescribe exclusive competence of the courts in the Republic of Macedonia.

The Permanent Court of Arbitration may decide in disputes with domestic and international elements.

Disputes with international elements are considered to be if (i) at least one of the parties, in the time of conclusion of the arbitration agreement, is a natural person with residence or permanent accommodation outside of the territory of the Republic of Macedonia, or is a legal entity whose headquarters are not on the territory of the Republic of Macedonia or (ii) the place where a significant part of the obligations of the trade relations shall be performed or the place with which the subject of the dispute is in the closest relation, is not located on the territory of the Republic of Macedonia.

If the parties have not agreed otherwise, the place of the arbitration shall be in Skopje. The language of Arbitration is by rule Macedonian, however the parties may agree upon a different language. In these proceedings the parties may appoint their representatives or counselors.

The parties may agree for the dispute to be led by individual arbiter or arbitral counsel which consists of three arbiters. If the value of the dispute is below 30.000 EURO an individual arbiter shall decide in it and if it is above 30.000 EURO the arbitral counsel shall be competent to decide.

The arbitration procedure is usually commenced by filing of a lawsuit and ends with final and irrevocable decision which is binding to the parties. The parties are obliged to execute the decision without delay.

The arbitrators are selected from the list of the Permanent Court – Arbitration (list of arbitrators for disputes with international elements and list of arbitrators for disputes without an international element), but each party may select an arbitrator outside that list if it is independent and impartial person. The arbiter may be also a foreign citizen.

On their own free will the parties shall decide and choose arbitrator, with taking into consideration the arbiter’s independence and impartiality in his work, as well as his expertise in the relevant area, knowledge of the language to which the procedure is lead, the arbiter’s experience.”

The advantages of arbitration trail are the speed of proceedings, lower costs, impartiality in decision – making, the expertise of the arbitrators, the autonomy of the will of the parties in the proceedings, one instance in the proceedings, confidentiality in the proceedings, the place of the arbitration, the language of the arbitration.

Company: CAKMAKOVA Advocates, Skopje Name: Mrs. Biljana Cakmakova Email: cakmakova@mlca.com.mk Web: www.mlca.com.mk Address: 8-ma Udarna Brigada no.43/3 , Republic of Macedonia Telephone: +389 2 3233 599

April 2012 /

11

SECTOR SPOTLIGHT: Doing Business in Serbia

DOING BUSINESS — in Serbia

Compared with the majority of Eastern Europe Serbia is expected to make the biggest improvements to the business environment. PricewaterhouseCoopers ranked Serbia as the 3rd most attractive manufacturing and 7th most attractive services FDI destination among emerging economies.

The latest European Union Scoreboard report shows Serbia as the country with the highest growth in public R&D expenditures in 2011, Serbia increased budgetary R&D expenditures by 22% in the last five years which is more than all other countries in Europe. Serbia’s labour force combines exceptional working efficiency with sizable labour supply. With a unique combination of high-quality and low costs, it is one of the key factors in reaching a strong business performance.

The Serbian economy has stabilised but growth has remained slow. The recovery from the 2009 economic slump has been obstructed by the European debt crisis through trade and banking links. Growth in 2011 looked promising in the first half of the year however a decline in trade in the latter half saw growth drop to 2%. This in turn has lowered predictions for growth in 2012 and the forecast has dropped to 1.1% from a previously predicted 2.1%. This was largely as a result of declining exports following the downturn in Europe. Inward investment was below US$2bn in 2011 and will remain inadequate to finance the current account deficit, keeping the new government under tight IMF constraints. Acquisition International speaks to the experts.

Panayiotis Diallinas first joined Eurofast Global in 2007 as Regional Business Development Director of South East Europe offices. He is in charge for Eurofast’s business development activities in the Region and a Member of the Board since 2010.

Eurofast is an international boutique professional services Group with its headquarters in Lefkosia operating in South East Europe and East Mediterranean through fully fledged offices in Athens, Thessaloniki, Sofia, Bucharest, Belgrade, Podgorica, Tirana, Skopje, Zagreb, Pristina, Banja Luca, Sarajevo, Cairo and Alexandria.

“Our professional services include accounting and payroll services, transaction advisory, compliance reporting and cross border structuring. Eurofast employs over 220 people in South East Europe and East Mediterranean. It is managed by a team of professionals capable of efficiently addressing all client needs in one single meeting, using one single language for all the countries in the Region.

Eurofast in recent years has achieved worldwide market recognition for its exceptional advice, capabilities and innovation in the Region.”

12

/ April 2012

WHAT FACTORS HAVE CONTRIBUTED TO SERBIA BEING RANKED 3RD MOST ATTRACTIVE MANUFACTURING AND 7TH MOST ATTRACTIVE SERVICES FDI DESTINATION AMONG EMERGING ECONOMIES? “First of all its competitive location as well as the skilled and competitive labor force. Serbia is internationally recognized for its business reforms as well as for its investment location in South Eastern Europe. Serbian economy radically improved over the past 10 years welcoming big multinationals and attracting over $20 billion in investments.

“Belgrade was awarded in 2007 as the City of the Future for Southern Europe by the FDI Magazine.

Over 40% of Serbia’s gross domestic product (GDP) is generated within Belgrade which engages 31,4% of Serbia’s labor force.

Serbia is also a member of the Central European Free Trade Agreement (CEFTA), enjoying Free Trade Agreement with Russia as well as Turkey, EFTA members, Belarus, and Kazakhstan and duty-free exports to the European Union and the United States for most products and services.”

Law office Kosic is a part of a group which represents the oldest law practice in region. The Law office is established as a part of the group specialised for the corporate and commercial law and it operates at the highest professional standards and participates not only in national but also in international transactions and in that purpose, special teams for M&A and corporate law, bankruptcy, restructuring, energy law, etc are formed.

Attorney at Law PhD Dubravka Kosic is a founder and senior partner in Law office Kosic and head of M&A and corporate law department.

WHAT IS SERBIA CURRENTLY DOING TO IMPROVE ITS BUSINESS ENVIRONMENT IN 2012?

“It is indisputable that the global economic crises have had a significant impact on our country.

Although Serbia acquired the status of candidate for EU, it is still necessary for legal system and institutions to be developed with the aim to improve conditions for attracting the large foreign investments. In addition to the significant legislative changes and improvement in order to simplify the administrative and bureaucratic procedures, there

have been changes in procedures for obtaining permits and approvals necessary for future investors to start business in the Republic of Serbia. Legislation of the Republic of Serbia is considerably closer to EU legislation, and set of Laws, that will have key impact on further development, has been adopted and their full implementation and benefits are expected in year 2012.

Series of investments that were initiated in 2011 and which implementation is expected in 2012, will greatly affect the future economic development.”

CAN YOU EXPLAIN WHY STRONG FOREIGN INVESTMENT AND THE CONTINUED RESTRUCTURING OF THE SERBIAN ECONOMY ARE SO IMPORTANT TO THE REGION? “The Republic of Serbia is a country with great geographic location and represents the canter of the region and the base of regional connection through its infrastructure which has been significantly developed in the last period.

The common history and cultural familiarity is the link with countries in the region therefore neighbourly relations and economical interests caused regional market connections. As a developing country, which prosperity is without doubt, countries in the region recognize Serbia as an ideal partner for the business cooperation and opportunity for entering our market as well as joint entering the global market.”

SGS Group is the world’s largest organization for inspection, testing, monitoring and certification. As a global model, SGS operates through a network of more than: 67,000 employees and 250 offices and laboratories around the world.

SGS Beograd was founded in 2001. as a full member of the SGS Group and from then begins its rapid development and winning new markets in the area of professional and specialized services. SGS Beograd today employs over 120 skilled and experienced professionals, dedicated to providing first class services and prepared at all times to create added value its customers.

Within the company are: two modern and fully equipped laboratories and office in Montenegro. SGS Beograd is able to provide services in the following business lines: Agricultural, Consumer Testing, Environmental, Automotive, Industial, Mineral, Oil,

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT: Doing Business in Serbia

Gas & Chemicals, Trade Assurance and Systems & Certification services.

Thanks to the excellent professional experience, strict adherence to ethical standards of the founders and the support of the global network, SGS Beograd has become a leading international company in Serbia in the field of inspection and certification, with the goal to become soon the same in the area of testing services.

After 26 years of professional practice, Darko Spasic founded Spasic & Partners Law Office in January 2006 together with two lady colleagues, Ana Godjevac and Vesna Milosavljevic-Stevanovic, both practice proven outstanding, talents of their generation.

Spasić & Partners are qualified and specialized in providing legal services (research, analysis, support in drafting and negotiations) in the field of foreign investments, acquisition of companies, privatisation, establishment of companies and foreign representative offices, joint ventures, corporate governance, financial transactions, credits and loans, securities, licenses, international trade (including but not limited to agency agreements and distribution agreements), transfer of technology, civil engineering, labour relations, taxes, and representation of foreign and local companies before the courts of law of Serbia and before foreign arbitrations.

Darko Spasic, Managing Partner, Spasic & Partners Law Office. Spasic & Partners cultivate exceptional meticulous approach to all services provided to all clients. Spasic & Partners are profoundly honoured to understand that such approach is recognised and appreciated by the clients – a fact evidenced by grant of mandate in more than 100 merger and acquisition projects, project finance loans, syndicated loan facilities and day-to-day support to a significant number of major international banks and companies.

Illustrative examples could include support to Lafarge in the first privatisation M&A in Serbia and subsequent corporate restructuring and further three M&As, counsel with BNP Paribas to the Deposit Insurance Agency of Serbia in first three sales of state owned banks and socially owned insurance company (with restructuring of the relevant regulatory framework), counsel to IFC and EBRD in a number of project in the Western Balkans, counsel to G4S in several acquisitions in the Western Balkans, etc.

ACQUISITION INTERNATIONAL

WHAT FACTORS HAVE CONTRIBUTED TO SERBIA BEING RANKED 3RD MOST ATTRACTIVE MANUFACTURING AND 7TH MOST ATTRACTIVE SERVICES FDI DESTINATION AMONG EMERGING ECONOMIES? The following could be recognised as responsible for such status of Serbia: • Skilled labour, • Comparatively low cost of labour • Accessibility to EU markets • Very low or duty free access to markets of Turkey, EFTA members, Russia, Kazakhstan • Significant subsidies and incentives to foreign investors • Strong commitment to establishment of modern market economy • Business friendly environment • Legal and economic reforms striving for alignment with EU standards WHAT IS SERBIA CURRENTLY DOING TO IMPROVE ITS BUSINESS ENVIRONMENT IN 2012?

The main processes include granting of EU candidate member status to Serbia, introducing efforts aimed at control of inflation and maintenance of the Serbian Dinar and the further harmonisation of laws with EU standards

Company: Eurofast Global Name: Panayiotis Diallinas Email: panayiotis.diallinas@eurofast.eu Web: www.eurofast.eu Address: 31/4 Beogradska Street, 11000 Belgrade, Serbia Telephone: +381 11 3241 484

Company: Law office Kosic Name: Attorney at Law Dubravka Kosić Email: dubravka.kosic@kosiclaw.co.rs Web: www.kosiclaw.co.rs Address: 6 Desanke Maksimović street, 11000 Beograd, Serbia Telephone: +381113345195

CAN YOU EXPLAIN WHY STRONG FOREIGN INVESTMENT AND THE CONTINUED RESTRUCTURING OF THE SERBIAN ECONOMY ARE SO IMPORTANT TO THE REGION? Serbia is geographically central country in the Balkans with the highest population in the Western Balkans with significant infrastructure, agriculture, manufacturing and services potentials.

Company: SGS Beograd Email: sgs.beograd@sgs.com Web: www.sgs.com Address: Jurija Gagarina 7b,11070 Belgrade, Serbia Telephone: +381117155275

Company: Spasic & Partners Name: Darko Spasic Email: d.spasic@spasicpartners.com Web: www.spasicpartners.com Address: Gospodar Jovanova 73, 11000 Belgrade, Serbia Telephone: 00 381 11 2633872

April 2012 /

13

SECTOR SPOTLIGHT:

Doing Business in Slovakia

DOING BUSINESS — in Slovakia

Slovakia is an attractive place to invest, It has good ties with markets in Western and South-eastern Europe and benefits from having a central position in Europe with good and steadily growing infrastructure.

The region has a stable political & economic environment which has help to sustain growth. The country has a simple and fair taxation system. The region has highly skilled and educated workforce offering the highest labour productivity in the CEE region with favourable labour costs and flexible Labour Code.

Slovakia’s economy is expected to slow. Dependence on exports to the Eurozone means that GDP growth will be very weak in 2012. The economy grew by an estimated 3% in 2011 and growth for 2012 is forecasted to slow to 1.1%. Export volumes of goods and services are now expected to contract by 1.7% in 2012, with demand for Slovakian goods falling as the Eurozone debt crisis weighs heavily on demand.

80 percent of Slovakia’s exports go to European markets. The downturn will be felt most acutely in the manufacturing sector. Subdued exports will also hit investment. Unemployment rate is expected to peak at 15% in 2012, which will hit consumption.

Acquisition International speaks to the experts.

The Law Office of Dr. Pavol Biksadský (ADVCT legal LLC) was established in January 2006 and today our services are available to a large Slovak and foreign client base, with a special focus on Italian and English-speakingclients. Pavol Biksadsky is Managing attorney of ADVCT legal LLC, Bratislava, Slovakia.

The managing attorney, Dr. Pavol Biksadský graduated in law at the Law faculty of the Comenius University in Bratislava in 2001. During his legal practice he had worked for a number of years in top Bratislava law offices, until the time was right to open his own practice. From his offices in Bratislava and Malacky he works mainly in the area of business and civil law, with a particular focus on laws pertaining to business contracts, real estates, corporate law and labour law. He has gained considerable experience from representing clients in court and arbitration proceedings, including international arbitration.

His legal team includes four qualified lawyers plus administrative staff. Initially, our command of English and Italian language, experience with working with an international client base for more than ten years and extreme professional emphasis on the quality of our objective-orientated services were the main factors in our offer. As our client base began to expand, the real time feedback we received (and a significant factor in client retention and organic growth), indicates our swift response and “can do” attitude is rated very highly among our clients too.

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/ April 2012

CAN YOU PLEASE DESCRIBE THE CURRENT BUSINESS CLIMATE IN SLOVAKIA? “No doubt, there are a lot of uncertainties. The Slovak economy is a very open one, more than 80 % of the production is exported to the EU member states and approx. 70 % is imported from the EU member states. The economic performance and thus also the business climate is therefore depending on the developments in the leading European economies.

Generally speaking, the climate can be described as cautious optimism.”

WHAT RISKS DOES SLOVAKIA FACE IN 2012?

WHAT PROCEDURES HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? “Critical in the next 12 months, in line with the general situation, will be the ability of the government to prevent the general government gross debt (its actual level of approx. 47 % of the GDP) from rising and to continue in curbing the public finance deficit (actually at approx. 4,9 %) in order to arrive below the 3 % level in 2013. Slovakia has adopted a constitutional amendment regarding the limitations of public spending and is closely following latest EU initiatives in this regard.”

Martin Kiňo is Partner of BDR, spol. s r.o. an independent member firm of Moore Stephens International Limited.

BDR was established in 1991. The company has its offices in Bratislava, Banska Bystrica and Liptovsky Mikulas. In 2011 the company became an independent member firm of Moore Stephens International Limited.

BDR provides audit, financial and business consulting, tax advisory and accounting services. BDR has long-term high standards of provided services, sophisticated system of quality control and immediate and pro-active engagement of our team, which gives the company the ability to identify all risks as well as possibilities of further development and improvement for its clients. Slovakia had early parliamentary elections in March 2012. Since the leftwing party SMER won the elections by overwhelming majority, it will be the first time in Slovak history that the country will have a single party government and therefore the investors will certainly monitor the first steps of the new government.

WHAT RISKS DOES SLOVAKIA FACE IN 2012?

WHAT PROCEDURES HAVE BEEN PUT IN PLACE

TO PROTECT THE ECONOMY? “Slovakia still belongs to the most dynamic countries in the European Union as far as GDP growth is concerned. The outgoing government has managed to stabilize the growing public debt in 2012 and it will be decisive whether the new government can bring the public debt under 3% of GDP until 2013.”

HOW WELL CONNECTED IS SLOVAKIA IN TERMS OF TRADE AND EXPORT LINKS? WHAT DOES THIS MEAN FOR FOREIGN INVESTORS? “Slovakia is an export driven country and has strong trade and export links especially with EU countries.”

HOW ATTRACTIVE IS THE COUNTRY’S TAXATION SYSTEM TO FOREIGN INVESTORS? “Slovakia had a flat tax rate of 19% until 2011 and since 1st January 2011 the country implemented an increase of 1% on VAT. Still the country remains one of the most attractive countries for foreign investors as far as taxation system is concerned with regard to a great number of tax relief projects for foreign investors.”

WHAT IMPACT HAS JOINING THE EURO IN 2009 HAD ON THE COUNTRY’S ECONOMY? “The Euro meant for Slovakia greater stability for the country during the economic crisis, however the more expensive currency also made some industries (building, tourism, retail) less competitive in the region.”

WHAT ARE YOUR PREDICTIONS FOR SLOVAKIA’S FUTURE POSITION IN THE EASTERN EUROPEAN MARKETPLACE? “The new single party government could create a stable economic growth and attract enough new investments in order to make Slovakia an important market player in the region.”

Jones Lang LaSalle is a financial and professional services firm specialising in real estate. The firm offers integrated services in investment consultancy (capital markets), valuation, property management, research, office, industrial, retail agency as well as residential agency. Miroslav Barnáš, Managing Director Jones Lang LaSalle Slovakia. Jones Lang LaSalle was established on the Slovak market in 2006.

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Doing Business in Slovakia & Belarus

International perspective and local impact. We offer a combination of international experience and deep local market knowledge and together with broadly diversified service portfolio it makes us the truly unique “one stop shop” company on the Slovak market. After the merger with King Sturge we are currently able to offer a know-how of the two large international consultancies for the price of one. All together it makes us stronger, more flexible and better prepared to meet our client´s expectations.

Slovakia is a small country with an open economy and an overall business-friendly sentiment. Attitudes towards foreign investment have improved markedly since 1997.

The operating environment for foreign business improved rapidly after the government took active steps to create a more competitive business environment, with the help of a flat-tax regime.

Costs have remained low, particularly for labour and property. Overall, Slovakia´s favourable geographic location and relatively low-cost and well-educated labour force are still attractive for foreign direct investment. The country has a vast network of roads and railways, although they are in need of modernisation. From the property market point of view - despite the European crisis and relatively illiquid market – 2011 posted a record breaking result with over 530 mil. Eur worth being transacted.

The same stable – even positive – outlook remains for the 2012.

WHAT RISKS DOES SLOVAKIA FACE IN 2012?

WHAT PROCEDURES HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? Amid rising uncertainty elsewhere in Europe, the highly export-dependent Slovak economy will be hit as well. The pace of GDP growth in 2012 will depend largely on a revival of domestic demand, combined with the level of growth in key export markets such as Germany and the Czech Republic. Rising political risks – as a result of the recent government elections - could also negatively affect the economy. Slovakia will need to see continued upgrades in the business environment if it hopes to reduce unemployment rates following the 2009–10 surge and to diversify the economy, which is currently over-reliant on automobiles and electronics. Reforms of education and more funds for research and innovation would enable Slovakia to shift its focus gradually toward high-tech fields, as wages begin to approach West European levels.

HOW HAS THE EUROZONE DEBT CRISIS AFFECTED THE SLOVAKIAN ECONOMY AND ITS RATE OF GROWTH? “The Eurozone uncertainty is also affecting Slovakia’s sovereign ratings, and Standard & Poor’s downgraded the country in January 2012. Still, the agency’s outlook for Slovakia is Stable, making it the only Eurozone member other than Germany that does not have a Negative outlook. Industrial

ACQUISITION INTERNATIONAL

output and exports have been the key drivers of the economic recovery since late 2009, and with domestic demand continuing to be weak, the risks of a renewed downturn in economic growth are rising. Despite ECB’s 2 rounds of LTRO there is still lack of liquidity, confidence and subsequently rising difficulties in obtaining the project finance from the local banks”

environment in the country. First of all, some tax and custom privileges for investors were established.

But in practice the state controls the most interesting branches of economical activities. Frequently these branches are closed for a private capital.

DOING BUSINESS in Belarus Belarus managed growth of 5.3% in 2011 and attracted $19 billion of foreign investment which is twice as much than in the previous year. Industrial production went up by 9.1% and Exports of goods and services surged by 57.9% Belarus has a favourable position in Europe, linking the European Union to Russia and the Commonwealth of independent States. Over the past decade Belarus has made impressive progress and Improvements to the investment climate have made the country a serious emerging market.

The country has won the trust of the international business community and improved economic relations with many countries.SPP History and Competitive Advantages The Law Company “Stepanovski, Papakul and partners” renders a full range of legal services both to national and foreign companies, on various stages of their business activities, including project set-up, company registration, operational support and protection of their rights on the territory of the Republic of Belarus. Practice areas we work in: banking, knowhow, IT/ TMP, design and construction, FMCG production, distribution & marketing, advertising, telecommunication, sports, insurance.

The contemporary economical development of Belarus is interconnected with establishing of the Common Free Market Zone of Belarus, Kazakhstan and Russia on 01/01/2012. Such kind of integration supposes the creation of universal conditions for doing business in all three countries. It is based on a free movement of goods, capital, services, and people. The Common Free Market Zone opens Russian and Kazakh markets for the Belarusian goods and services. But at the same time the Belarusian Market is opened for Russian and Kazakh goods and services. The largest danger for the Belarusian Market corresponds to the Russian enterprises. Russian goods and services are more competitive in comparison with Belarusian ones. Belarus exports in Russia machines, provisions (particularly milk and meat products), mineral fertilizers, and other goods. Backwards fuel and energy resources, machines, equipment, black and color metals are imported in Belarus. The trade with Russia composed 39% in 2011 from the whole Belarusian international trade balance. Netherlands (11%) and Ukraine (10,2%) stand on the second and third ranks in Belarusian international trade balance.

As long as the value of trade with European Union countries is about 28% of the Belarusian international trade balance, the Euro Debt Crisis of 2011 hasn’t affected it directly. But the export in European Union countries increased twice in 2011 in comparison with 2010. If the export volume rise keeps its force in the current year the dependence of Belarusian economy from Euro will intensify. The Belarusian government made several steps to create an attractive investing

Company: ADVCT legal LLC Name: Dr. Pavol Biksadsky Email: office@advct.sk Web: www.advct.sk Address: Michalska 9, 81101 Bratislava, Slovakia Telephone: 00421918942592

Company: BDR, spol. s r.o.

Name: Martin Kino Email: martin.kino@bdrbb.sk Web: www.bdrbb.sk Address: Cernysevskeho 26, 851 01, Bratislava, Slovakia Telephone: +421 905 689 761

Company: Jones Lang LaSalle s.r.o.

Name: Ing. Miroslav Barnáš Email: miroslav.barnas@eu.jll.com Web: www.joneslanglasalle-slovakia.com Address: Suché mýto 1, 811 03 Bratislava Telephone: 00421 2 5920 9911

Company: Stepanovski, Papakul and partners Name: Maxim Shapelevich Email: m.shapelevich@spplaw.by Web: http://spplaw.by Address: 16 Kuibyshev Street, 4th Floor, Minsk, Belarus Telephone: +375 17 2094483

April 2012 /

15

SECTOR SPOTLIGHT: Doing Business in Latvia

DOING BUSINESS Latvia’s gross domestic product grew by 5.2% in 2011 and is expected to grow 2.1% in 2012. Over the past few years exports have been booming which has helped Latvia recover from the global downturn in 2008.

This has helped to grow processing and manufacturing industries and has one of the highest productivity growth rates in Europe. Structural reforms last year contributed to creating a stable financial system which has helped to sustain a favourable business environment. This has been useful for attracting foreign direct investment to the region. Latvia’s credit rating was improved in 2011 which will make servicing the country’s external debt and borrowing costs less expensive. 2012 is expected to be an uncertain year.

The current European crisis is likely to cause a downturn in export demand as much of Europe is expecting a contraction in growth in the coming year. Investment growth will be held down this year by on-going financial sector strains and uncertainty. Last year’s growth kept the fiscal deficit within target last year at around 4% of GDP, but the aim of bringing it below 3% this year remains out of reach as revenue growth slows and high unemployment keeps the welfare bill high.

Acquisition International speaks to the experts.

Aldis Gobzems is a sworn attorney at law to the Latvian Bar Association and insolvency administrator and also the founder of the Sworn Attorney’s Aldis Gobzems office.

Sworn Attorney’s Aldis Gobzems office was founded in 2008 but before that Aldis Gobzems, founder of the office, has worked as Member of the Board for the Privatization Agency of the Republic of Latvia, Director of Insolvency Administration and sworn attorney in top tier law firms in Latvia. Main practice areas of the Sworn Attorney’s Aldis Gobzems office are insolvency and restructuring, high-profile litigations due to extensive expertise in civil, administrative courts and the Constitutional Court of the Republic of Latvia. Recently the office has also developed its competition law and EU law practice.Sworn Attorney’s Aldis Gobzems office focuses to restructuring and insolvency as the main field of practice due to extensive experience of its founder in this sphere.

Recommendations of previous clients that the office has advised in high-profile restructuring cases also are an advantage.

Legal team working in Sworn Attorney’s Aldis Gobzems office consists of lawyers specialized in particular fields of law both academically and practically thus guaranteeing higher level of expertise. The office has also successfully worked with clients from Russia thus serving as intermediary between East and West for successful conduct of business activities.

WHAT FACTORS CONTRIBUTED TO LATVIA’S GROSS DOMESTIC PRODUCT GROWING BY 5.2% IN 2011? AND CAN WHY IS IT PREDICTED TO GROW BY A FURTHER 2.1% IN 2012?

“The recent growth of gross domestic product can be explained due to quite careful actions of the Latvian government that took reasonable measures after the crisis in 2008. We believe that due to significant changes in the taxation policy, refusal to devalue the national currency usage of wage cuts and deflation to boost competition is direct cause for the growth of gross domestic product. The predictions for 2012 are quite careful and reasoned due to recent euro crisis. “

— in Latvia

HOW HAVE BOOMING EXPORTS HELPED LATVIA

to resident nonfinancial companies and the volume of issued

RECOVER FROM THE GLOBAL DOWNTURN IN 2008?

loans stabilized and has now even increased slightly from the lowest level.”

“Booming exports have helped to make the GDP growth more stable and predictable and just in year 2011 the exports rates show have reached approximately the same index as in 2007.

This was mainly possible due to more focus on manufacturing and processing industries on national level as well certain benefits granted from the state. However, this cannot be viewed without the consumer demand failing to recover which is also a heating factor and index of the health of state’s economy.”

Insurance company BTA was founded on 1 November 1993.

On 17 December of the same year, BTA received a license that entitled it to start operating in the insurance market.

Today, BTA has all 18 non-life insurance licenses available in Latvia which allow the company to offer the widest range of insurance services to individuals and legal entities.

The most popular types of insurance offered by BTA are motor (own damages and TPL), health and property insurance.

BTA is a leader among insurance companies registered in Latvia in terms of gross premiums written, paid out insurance indemnities, balance sheet totals and technical reserves. Mr. Gints Dandzbergs is Chairman of the Board, “BTA Insurance Company” SE, he comments on what gives the firm an advantage over local and global competitors in your areas of expertise: “BTA works hard to retain the loyalty of customers and develop its sales network. Simultaneously, the company continues working on improving its insurance services, making them simpler and more understandable to customers.

Great attention was paid to the improvement of internal processes and servicing quality. BTA services and consultations are available both at client service centers all over Latvia, on the website www.bta.lv and by calling the Client Support Line at +371 26121212 at any time of the day, including weekends and holidays.

“A few years ago, we felt that the opportunities in the Latvian market would become limited and we decided to work on entering new markets in other places in Europe. Today, BTA sales outside Latvia are already significant. And this is only the beginning. In December 2011, we opened a BTA branch in Great Britain were we perceive great business perspectives; we have also launched business in Italy.

We are one of the pioneers in our sector that started exporting financial services. The experience gained in insurance, 18 licenses in all possible basic fields of insurance, loyalty and trust of customers proves that we are an insurer that can be trusted and that can develop and offer a wide and interesting range of services. Those are also important preconditions of a successful business in foreign markets.

/ April 2012

BUSINESS ENVIRONMENT IN 2012?

“2012 rather seems to be still a period of stabilization after sharp adjustments in 2009 and 2010. However, the government has started the discussion on social policy changes, as the expected slower pace of recovery should be further drag on unemployment. Existing policies in place are not expected to provide relief to labor market problems, therefore inequality and social tensions may increase again. It is expected that new economic and social policies will be introduced in 2013.

WHAT RISKS DOES LATVIA FACE IN 2012? WHAT METHODS HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? “The government should be focusing on “worst case scenario” in 2012, if external demand continues to weaken substantially.

Unfortunately it is not publicly known whether a plan for the worst case scenario is prepared.”

HOW HAS THE EURO DEBT CRISIS AFFECTED THE LATVIA ECONOMY AND ITS RATE OF GROWTH? “So far Latvia has been “lucky” and the Euro debt crisis has not had significant impact on export growth and domestic confidence, as can be seen by recent retail sales figures.”

Company: Zvērināta advokāta Alda Gobzema birojs / Sworn Attorney’s Aldis Gobzems office Name: Aldis Gobzems Email: aldis@gobzems.lv Web: www.gobzems.lv Address: Alberta iela 1-13, Riga, LV-1010, Latvia Telephone: +371 67561616

WHAT STRUCTURAL REFORMS LAST YEAR WERE PUT IN PLACE THAT HELPED CREATE A STABLE FINANCIAL SYSTEM AND SUSTAIN A FAVORABLE BUSINESS ENVIRONMENT? AND WHAT WERE THE KEY BENEFITS? “Stability of financial system in Latvia was further assured by recovering economy and government’s strong commitment to balance government finances by further reducing the budget deficit, as well as the banking system that is supported by relatively strong parent banks in Nordic countries. At the second half of 2011 Latvia saw increase in new loans issued

16

WHAT IS LATVIA CURRENTLY DOING TO IMPROVE ITS

Company: “BTA Insurance Company” SE Name: Mr. Gints Dandzbergs Email: bta@bta.lv Web: www.bta.eu.com Address: K. Valdemāra Street 63, Riga, LV-1142, Latvia Telephone: + 371 26 12 12 12

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT: Doing Business in Latvia

Juris Jakobsons is Chairman of the Board of Directors of Citadele Bank, Latvia. He speaks to Acquisition International about doing business in Latvia and the Baltic states.

Citadele Bank is a financial institution which provides a full range of services. It offers banking, financial and asset management services. The Bank is the only collaboration partner of American Express in Latvia and Lithuania who is entitled to issue American Express credit cards. The company’s vision is to become the most valuable local financial group in the Baltic States for both – our clients as well as shareholders and employees.

WHAT GIVES CITADELE THE ADVANTAGE OVER LOCAL AND GLOBAL COMPETITORS IN YOUR AREAS OF EXPERTISE?

“Our advantage is a long-term professional experience of our employees in Baltic and CIS markets. We comprehend these markets and we are able to make a decision very rapidly to react on the markets actual needs. In terms of variety of services, Citadele is one of the most advanced banks in the Baltics which besides traditional banking services also provides encashment, offers asset management and is an exclusive issuer of American Express credit cards in Latvia and Lithuania.”

WHAT FACTORS CONTRIBUTED TO LATVIA’S GROSS DOMESTIC PRODUCT GROWING BY 5.2% IN 2011? AND WHY IS IT PREDICTED TO GROW BY A FURTHER 2.1% IN 2012?

The Latvian economy advanced by 5.5% in 2011, supported by both external demand and gradually improving domestic environment. Moreover, the Latvian economy has managed to sustain the growth momentum even despite an upsurge in resource prices, with GDP in nominal terms climbing by more than 11% in 2011 compared to the previous year.

“There was a certain turnaround in the pattern of the economic growth – if exports and, consequently, manufacturing determined the pace of the GDP growth during the previous years, the growth became more broad-based and domesticallyoriented in 2011, with both domestic consumption and fixed capital formation contributing positively to the growth number. Labor market has also continued to recover, with the unemployment rate sliding from 16.9%, reached by the end-

ACQUISITION INTERNATIONAL

2010, to 14.3% in fourth quarter of 2011, supported by a gradual increase in the average gross wages.

For the time being, the economy has continued to demonstrate robust recovery dynamics, distancing itself from the trough, reached by the mid-2009, and expanding with an average speed of 1% per quarter. Although currently available figures are still not pointing to a deceleration in the growth dynamics, we suppose, that slower growth in the Latvian trading partner economies will inevitably translate into the Latvian statistic numbers. Neither external, nor internal demand will be immune from the global developments.”

HOW HAVE BOOMING EXPORTS HELPED LATVIA RECOVER FROM THE GLOBAL DOWNTURN IN 2008?

“External trade has been one of the main drivers behind the Latvian economy’s recovery. Exports advanced by roughly 30% for the second consecutive year in 2011. The solid exports performance during the last two years was mainly owing to the rebound in the Latvian main trading partner economies, namely Scandinavian countries, Germany, Baltic States and Russia, as well as to a substantial improvement in the Latvian economy’s competitiveness during the recession period.

Both private and public enterprises have dramatically cut their operating expenditures, which allowed unit labor costs to drop by more than 20% from peak to trough. Moreover, the weight of exports of goods and services in the Latvian economy has more than doubled compared to the pre-recession years, increasing to roughly 60% of GDP in 2011.

The exports-oriented sectors, namely manufacturing and transportation, have also noticeably benefitted from the favorable external environment during the last two years, with their shares in the economy’s structure continuing to increase. Nevertheless, as manufacturing sector has continued to strengthen, the necessity to import raw materials and capital goods has further worsened the Latvian trade balanced.”

WHAT STRUCTURAL REFORMS LAST YEAR WERE PUT IN PLACE THAT HELPED CREATE A STABLE FINANCIAL SYSTEM AND SUSTAIN A FAVORABLE BUSINESS ENVIRONMENT? AND WHAT WERE THE KEY BENEFITS? “Latvia’s government has taken a major consolidation effort amounting to roughly 16.5% of GDP during the last four years in order to minimize budget deficits and place Latvia’s public finances on a more stable and sustainable footing. Whereas government administrative and operational expenditures were drastically cut during the recession years, the expenditures for the EU structural fund acquisition, in turn, have been increased in order to cushion the adverse impact of the recession.

Latvia’s commitment to the implementation of the proposed consolidation measures has been highly approved by both investors and credit rating agencies. Latvia successfully returned to the capital markets in 2011, issuing 10 year Eurobonds worth 500 million USD, thus testifying its ability to borrow on capital markets at acceptable rates. Earlier this year, Latvia has placed its second Eurobond issue, offering 5-year USD denominated Eurobonds worth one billion dollars.

Moreover, in December Latvia has finalized its three-year

participation in the international loan program, provided jointly by IMF, European Commission and World Bank.”

WHAT RISKS DOES LATVIA FACE IN 2012? WHAT METHODS HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? HOW HAS THE EURO DEBT CRISIS AFFECTED THE LATVIA ECONOMY AND ITS RATE OF GROWTH? “Despite the escalation of the debt crisis in Eurozone in the second half of 2011 and somewhat softer economic numbers in the countries across Europe, the Latvian economy has proven to be fairly resilient, with both retail trade and manufacturing continuing to advance. Albeit Eurozone has been the main trading partner of Latvia, the trade linkages with the most distressed Eurozone’s periphery countries are rather weak, with their cumulative share not exceeding 4% of the total exports turnover. While the level of stress in Eurozone has declined since the end-2011, with the probability of any tail-risks decreasing significantly, there are certain fundamental factors that are likely to weigh on the economic growth in Eurozone in 2012.”

Projected moderate recession in Eurozone is likely to result in the slower economic growth in the Latvia’s main trading partner countries in 2012 and consequently in Latvia as well. Moreover, continuing deleveraging in the Latvian banking sector is about to restrain the faster recovery of the domestic demand.

Company: Citadele Bank Name: Juris Jakobsons Email: info@citadele.lv Web: www.citadelebank.com Address: Republikas square 2A, Riga, LV-1010, Latvia Telephone: +371 67 01 00 00

April 2012 /

17

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SECTOR SPOTLIGHT:

Doing Business in Slovenia

DOING BUSINESS The already weak recovery ground to a halt at the end of 2011. A slowdown in exports sent industrial growth into reverse and on-going strains in the banking sector restricted finance for investment. Mainly due to the positive first half of 2011 growth reached 0.5%.

The country’s economy in 2012 is expected to be heading toward stagnation with growth forecasted to be 0.2% due to the downturn in exports and a decrease in domestic consumption.

Slovenia has recently had its credit rating downgraded as a result of the poor outlook in 2012. Slovenia’s parliament has voted in a new government ending months of political instability. The political change should help to consolidate the state’s finances, fostering growth and creating employment.

One of the key tasks of the new government is to create a competitive business environment and attract new foreign direct investment. Slovenia is an attractive place to invest, It has good ties with markets in Western and South-eastern Europe, a central position in Europe and good infrastructure. The region has a skilled and highly productive workforce. The country has a positive business climate and benefits from low taxes, simple business start-up procedures and unrestricted transfer of profit and capital repatriation. Acquisition International speaks…

Luka Gaberščik, Attorney-at-Law, partner at BGK Law Firm from Ljubljana (Brulc, Gaberščik & Kikelj o.p., d.o.o.)

BGK Law Firm partners decided in 2009 to merge their solo practices and establish a one-stop law firm for business oriented clients. Our practice areas follow the needs of medium sized businesses, where we offer support in business, labour and administrative law with a strong emphasis on foreign investments, mergers and acquisitions.

We provide services in several foreign languages, we have a good understanding of international business law and of our client’s needs.

“With extensive experience in trial advocacy, we are able to suggest practical solutions that a strictly consulting firm is not able to provide. Our network of supporting professionals (experts, tax consultants, realtors,…) ensures a one-stop solution to most legal issues. Our local nature together with good language skills and legal expertise makes us a perfect partner for foreign investors.”

WHAT RISKS DOES SLOVENIA FACE IN 2012? WHAT METHODS HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? “Slovenia runs the risk of budget deficit and overspending.

With the new government in place, Slovenia decided to plan for spending cuts and new taxation. To avoid additional capital drain and to boost confidence of foreign investors, several administrative measures with the aim to facilitate investment have been proposed. We are also expecting a change in legislature facilitating greenfield investments in Slovene

ACQUISITION INTERNATIONAL

— in Slovenia

economy tied with a governmental subsidy schemes that would make it the best time for investing in Slovene market.

The number of insolvency procedures has risen in the past effectively making markets less competitive. This procedures offer unique investment opportunities in real estate and manufacturing for interested newcomers.

A relatively high unemployment rate will require a more flexible approach to regulation of work force, especially in hightech industries, where influence of worker unions is relatively weak. Adding to the fact is the government’s plan to review the tax burden for knowledge based industries and skilled professionals.

HOW HAS THE EUROZONE DEBT CRISIS AFFECTED THE SLOVENIAN ECONOMY AND ITS RATE OF GROWTH? The aforementioned crisis affected Slovenia with a stronger effect than other EU members, because Slovene businesses had an above average debt to equity ratio. A rise in interest rates made several projects unfeasible and at the same time also less secured. In the legal sphere this results in several insolvency procedures which have been inadequately regulated.

A lack of policy foresight meant a slow moving mass of asset liquidations and an additional pressure on the market.

As already stated, we believe that the current situation in insolvency procedures offers tremendous opportunities for more flexible investors.

Studio Moderna is a direct to consumer retailer with rapidly growing operations across CEE. With over 5,000 employees operating in 21 countries and reaches a market of 400 million consumers, driving demand and selling popular branded products to consumers across the region.

however there was a stable exchange rate environment for many years prior to joining Euro.

Indirectly the Eurozone debt crisis has impacted the Slovene economy with reduced demand in three key export destinations – motor industry in Western Europe, consumer goods sector in northern Balkans and the engineering sector in Eastern Europe. Obviously availability of bank liquidity has also impacted.

Despite the downgrade the sovereign rating still compares favourably to countries that have significant FDI such as Slovakia and Poland. The higher taxation rates are not favourable, though the Slovene labour force is considered well educated and very capable. Slovenia had opportunities to become the link to South –East Europe, however these will be fewer with Croatia and Serbia closing in on entering the EU.”

The company has built up an enviable operating and technology platform with integrated multi-channel sales occurring via home shopping and direct response television, local websites, catalogs, owned retail stores , third party retail & wholesale partners and call center operations. Dusko Kos, Managing Director Studio Moderna Slovenia “Having a very focused and relevant business model where everything we do is done in a transparent way. Efficiency and return on investment measured on a daily basis through our integrated IT platform is a key support in our efforts to leverage communications / sales channels in order to be able to reach our customer and to be accessible whenever and however they want.

Slovenia like all smaller economies is affected by the international economic environment and companies focused in export are in better condition. However companies that are debt leveraged are vulnerable during the sovereign downgrading cycle. However companies also have the possibility to also identify and create opportunities in the current situation. The Slovenian economy is very engaged in international activity.

Despite having success in certain sectors the economy as a whole is entering into recession according to recent outlook.

Restructuring is necessary but not only as an implementation of costs cutting measures. Without implementing measures on how to revitalize investments and promote new investment, the country will struggle to see economic growth. Public sector spending and exports are the growth engines as consumer demand is not a significant deriver to the relative small size of the domestic market. Slovenia adopted the Euro in 2007;

Company: BGK Law Firm Name: Luka Gaberščik Email: luka.gaberscik@bgk.si Web: www.bgk.si Address: Beethovnova street 4, 1000 Ljubljana, Slovenia Telephone: +386 59-11-99-00

Company: Studio Moderna Name: Dusko Kos Email: david.buckley@studio-moderna.com

April 2012 /

19

SECTOR SPOTLIGHT:

Doing Business in Lithuania

DOING BUSINESS — in Lithuania

In 2011 Lithuania’s achieved growth of 5.8% in its economy, the highest reached since the global crisis in 2009. Despite the recent downturn and uncertainty related to Eurozone debt problems Lithuania is expected to be the second fastest growing economy in Europe in 2012.

Predications by the IMF suggest growth will reach 3.5% in 2012.

Exports in 2011 grew by 28.8% in comparison to the year before however continued growth in this area is likely to come under strain as demand from Lithuania’s main trading partners suffer due to uncertainty in the EU. These export partners are expected to recover and growth is likely to return in the latter half of 2012.

Of the total industrial production in 2011, 66.5% was sold abroad.

Acquisition International speaks to the experts .

Since 2004 when Lithuania became the member state of the EU, EUROTEISES BIURAS is one of the leading medium-sized Lithuanian law firms with highly qualified and experienced business law experts.

Darius Sauliūnas is a Managing Partner, attorney-at-law at Euroteisės Biuras. He comments on the factors that contributed to Lithuania achieved growth of 5.8% in its economy in 2011 and why the IMF predicted growth to reach 3.5% in 2012: “Several factors: first, Government’s early efforts to get to grips with growing budget deficits. Second, business has adapted to the new economic environment and focused on exports. Third, consumers stopped saving money – the financial freeze was over and people came back to the action. Fourth, statistics showed that the economic downturn is really over and this has led to the optimism and positive movement of capital.

DESPITE THE RECENT DOWNTURN AND UNCERTAINTY RELATED TO EUROZONE DEBT PROBLEMS, WHY IS LITHUANIA EXPECTED TO BE THE SECOND FASTEST GROWING ECONOMY IN EUROPE IN 2012?

“One should always remember that the downturn was really huge.

Actually, in some areas it was the highest in the EU. The logics of economy is that the recovery is inevitable (remember examples of economic recovery after wars). The logistics and construction sectors are recovering faster because the downturn was deep and rapid. The means of construction and logistics didn’t disappear.

Some workforce migrated mostly to UK, but those who left – has enough activity to continue and even expand.”

IN 2011 LITHUANIAN EXPORTS GREW BY 28.8%, HOW WILL THE EUROZONE DEBT CRISIS AFFECT THE INDUSTRY IN 2012?

“It’s hard to predict whether the industry will actually feel the Eurozone debt crisis in general. It seems that this is not going to be the general impact, simply some practical insolvency issues with regard to the customers in Eurozone. Those exporters who will be prepared for such possibility will easily tackle such issue as an ordinary threat for the business.”

BaltCap is the leading private equity investor in the Baltic States (Estonia, Latvia and Lithuania). The firm provides equity capital for growth-oriented Baltic companies. Since 1995, we have invested into more than 50 different companies.

Simonas Gustainis is Partner, BaltCap. “Being a local private equity company with offices in Lithuania,

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/ April 2012

Latvia and Estonia gives us first-hand contact network with local entrepreneurs and companies. Local presence also puts us in a better position to help our companies grow in the regional market. Having been active on the market since 1995 we established a solid track-record and good knowledge of local economy structure. Our fund sizes and investment criteria are also tailored to meet the demand for capital in our markets.

In 2011, Lithuanian economy continued to recover from the financial crisis of 2009.

follow them. We are realists. We always assess the real situation.

The knowledge and experience available allow us to look ahead and see the prospects in the future that await our Client.

We do not conceal anything and do not paint in bright colours since a correctly formulated problem is already half of its solution. When you know it you will also know what to do. We are just that. Therefore we chose a key as our symbol – a symbol of knowledge, experience, reliability and search for truth.

Despite healthy growth rate the economy has only now recovered to the pre-crisis level and is expected to surpass that in 2012. Being a small open economy Lithuania went through a quick but painful adjustment by cutting wages and public spending which has helped to restore competitiveness.

This has helped to restore growth in the exports which has led the early recovery and has fuelled domestic spending also in 2011. The growth will inevitably slow down in 2012 as some exporting companies are already close to their capacities and Eurozone worries will affect investment sentiment.”

IN 2011 LITHUANIAN EXPORTS GREW BY 28.8%, HOW WILL THE EUROZONE DEBT CRISIS AFFECT THE INDUSTRY IN 2012?

“Export growth will slow down due to limited capacity. But there also could be a positive effect of Eurozone problems in Lithuania - as the economy slows there, companies in the Eurozone will seek to cut costs and outsourcing some functions or production to the Eastern Europe might be the decision some companies take. Cost benefits of outsourcing to China or India have diminished over the recent years and operationally partners in Europe are much easier to deal with.”

Company: EUROTEISES BIURAS Name: Dr. Darius Sauliūnas Email: d.sauliunas@euroteise.lt Web: www.euroteise.lt Address: K.Ladygos g. 1, 08235 Vilnius Telephone: +37068553093

WHAT METHODS AND POLICES HAVE THE LITHUANIAN GOVERNMENT INTRODUCED TO CREATE A GOOD COMPETITIVE BUSINESS ENVIRONMENT? “Lithuania ranked 27th in World Bank’s doing business ranking for 2012, virtually unchanged from 2011. So the overall situation is quite good, although there certainly are areas to improve. Recent focus of the government has been simplifying the process of establishing companies in order to promote entrepreneurship.”

HOW HAS THE EURO DEBT CRISIS AFFECTED THE LITHUANIAN ECONOMY AND ITS RATE OF GROWTH?

Company: BaltCap Name: Simonas Gustainis Email: simonas.gustainis@baltcap.com Web: www.baltcap.com Address: Jasinskio 16B, Vilnius, Lithuania Telephone: +370 5254 6713

“One can only guess what the growth rate would have been if not for the troubles in the Eurozone as it is the main export partner for the country. Despite that, the country has coped quite well and the prospects for 2012 are also good.”

Three attorneys partners are working in the Law Firm “Žlioba & Žlioba” located in the city centre of Klaipėda. It is one of the largest law firms in Western Lithuania.

Attorneys of the Law Firm “Žlioba & Žlioba” represent their Clients in the courts of all instances of the Republic of Lithuania as well as in the European Court of Human Rights. Attorneys specializes in different areas of law therefore we are offering you qualified legal aid of the highest class. Legal advice is provided in Lithuanian, English and Russian languages. A Client is most important to us therefore we do not create illusions and do not

Company: Advokatas Arūnas Žlioba Name: Advokatų kontora “Žlioba & Žlioba” Email: arunas@zlioba.lt Web: www.zlioba.lt Address: J. Janonio g. 17, LT-92238 Klaipeda, Lietuva Telephone: +370 46 311523

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Relocation , Relocation, Relocation

RELOCATION

— Relocation, Relocation

In 2011 cross-border activity rebounded strongly, representing 41.5% of all global M&A activity. Triggered by the increasing internationalisation of markets and industries, the international relocation of top management team members, and core functions like finance and R&D is happening more and more.

Relocating individuals and departments is extremely strategically beneficial, essentially people are being moved to grow business and share expertise.

WHAT FACTORS HAVE DRIVEN THE STABILIZATION OF THE CORPORATE RELOCATION INDUSTRY IN YOUR JURISDICTION/REGION OF EXPERTISE?

CAN YOU PLEASE DEFINE THE KEY BARRIERS THAT COMPLICATE THE RELOCATION PROCESS IN TERMS OF YOUR EXPERTISE?

Moving however, is a costly and complicated process and one that warrants support from the best in the industry to make the transition as smooth as possible. Barriers can include personal ties, functional interdependencies and fiscal and legal constraints at the individual, organizational and country level. Some firms may have had to cut relocation spends due to market pressures but budgets are returning and sometimes geographic talent imbalances make relocation an absolute necessity whatever the cost. Acquisition International speaks to the experts.

“The relocation industry has seen a number of acquisitions and further consolidation. There has also been a hardening of the lines between the small, local, moving and destination services companies and the global relocation management companies who co-ordinate services. We’ve changed the dynamics in the marketplace by offering a range of coordinated relocation services on a local/regional/global basis in addition to offering the more local delivery of moving and destination services.”

“Expat assignments can fail when an improper or poorly designed benefits plan is in place. Conversely, an excellent benefits plan removes stress from expats and their families by providing access to vetted medical care providers, a 24/7/365 help line, which includes medical and prescription translation in over 100 languages and overall reduced out-of-pocket costs. Other issues commonly overlooked are the existence of a domestic carrier’s “residency clause” that can make a local plan unworkable for expats. Some of the negative ramifications associated with putting an expat on a local employee benefits plan include; no future right to COBRA benefits, and no evacuation/repatriation or other vital support services often needed by international assignees.

John Rason, Director of Business Development, Interdean Relocation Services - part of the Santa Fe group, he comments: “We have over 3,000 relocation experts in 122 offices worldwide, providing relocation services for organisations who want to transfer their employees across the globe. In 2011, we relocated 110,000 employees and their families.

We work cross-sector with companies managing anything from a handful of relocations per annum through to organisations with more than 1,500 International Assignees.

Typically clients all want the same thing – for us to make employees’ lives easy, enabling them to focus on their day job while we take care of the entire relocation process.”

WHERE ARE MOST OF YOUR CLIENTS RELOCATING TO AND FROM? WHAT ARE THE CURRENT PUSH AND PULL FACTORS FOR THESE MAJOR DESTINATIONS? “The UK, US and China are still significant destinations, but with the discovery of new energy sources in Brazil, India and China we’re seeing an increase in relocations to these countries.

Having our own offices in the most challenging destinations provides benefits to clients who want to control service and costs.”

WHAT ARE THE MAJOR BENEFITS OF OUTSOURCING RELOCATION NEEDS TO YOUR COMPANY? “We offer consistency, scale, local market knowledge, innovation and the management of risk for both the employee and the company, and a comprehensive understanding of immigration laws.

We are also able to deliver services globally and this includes partnering in locations and in broader range of services. And we keep track of all relocated employees wherever they are in the world – an invaluable service to HR teams.”

ACQUISITION INTERNATIONAL

Kristin Ash, Sales Director at ITG Worldwide. Over 20 year’s project management experience across multiple industries with the past five years at ITG Worldwide focusing on international benefits. Kristin is a recognized leader in her field receiving 2011 EMMA nominations from the FEM (Forum for Expatriate Management) in the categories: Global Mobility Rising Star, Best Vendor Relationship and Best Vendor Partnership with CIGNA. , she comments: “ITG Worldwide started over 25 years ago as a travel insurance specialist. We’ve expanded our capabilities over the years beyond travel insurance to provide a full spectrum of benefits, including: medical, life, disability, AD&D, Kidnap & Ransom, personal property, and liability for individuals and groups in all countries including high risk areas.”

Also, upon return to the U.S., the employee cannot receive a letter of credible coverage required by U.S. carriers to eliminate pre-existing condition limitations. Further, local benefit plans often just can’t work for expats. They need specialized benefits with an international carrier who recognizes and addresses the needs and stresses associated with living outside your home country.”

WHAT GIVES YOU AN ADVANTAGE OVER LOCAL AND GLOBAL COMPETITORS IN YOUR AREAS OF EXPERTISE? “International benefits are our only focus. We are a top producer with the leading global insurance providers. This allows us to create customized plans that meet the unique needs of each client.

We’ve succeeded and grown by educating our clients, paying attention to detail and by being quick, thorough and responsive. Our advantage lies in our specialized focus in international benefits, our years of experience and our strong relationships with leading global insurance providers.”

Company: Interdean part of the Santa Fe Group Name: John Rason Email: john.rason@interdean.com Web: www.interdean.com Address: Global Headquarters, Central Way, London NW10 7XW, United Kingdom Telephone: +44 (0)20 8961 4141

WHO IS A TYPICAL CLIENT? “Our clients are organizations in all industries that send employees on assignment outside their home country.”

WHERE ARE MOST OF YOUR CLIENTS RELOCATING TO AND FROM? “Our clients collectively are a large and diverse group encompassing multiple industries with employees moving to and from all countries where business growth is taking place.

Our clients travel to all areas of the world for business, academic enrichment and volunteer non-profit endeavors. They are the organizations we all hear about that are making truly global business a reality.”

Company: ITG Worldwide Name: Kristin Ash Email: kristin@itgworldwide.com Web: www.itgworldwide.com Address: 500 Professional Center Drive, Suite 515 Novato, California 94947 USA Telephone: 1.972.722.6399

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SECTOR SPOTLIGHT:

Resolving Disputes in the Insurance and Reinsurance Industry

RESOLVING DISPUTES

— in the Insurance and Reinsurance Industry

Stephen Netherway and John Cadman are partners and Alaina Wadsworth is an associate in CMS Cameron McKenna LLP’S (“CMS”) Insurance Sector Group. CMS is a full service law firm which is part of unique network of legal service providers conveying 29 jurisdictions, based in the City with market-leading practices, including in the insurance and reinsurance field.

CMS offers a broad range of transactional, advisory and contentious legal services, including company/corporate and M&A, real estate and environmental, commercial and IP, banking and finance, employment, tax, energy/oil and gas, dispute resolution, derivatives and capital markets.

CMS is sector focused, allowing it to offer a seamless service across different practice and geographical areas. With a client base comprising of major global insurance and reinsurance companies and intermediaries, CMS’s Insurance sector group is uniquely placed to advise on major domestic and international deals and matters in the insurance and reinsurance sector.

WHY IS INSURANCE AND REINSURANCE ONE OF THE MOST CONTENTIOUS INDUSTRIES OUT THERE? The insurance market insures a high volume of risks on a daily basis; margins are tight and there is continuous tension between the need to preserve the market’s ability to devise and distribute products with flexibility and innovation, while at the same time being subject to regulatory oversight. It is a business that, to this day relies on the principle of utmost good faith in the placing of a risk, any disconnects in the parties’ expectations and understandings of the information submitted on placement may only emerge when a claim arises. When that happens, litigious issues can arise. If economic climes are testing, as they currently are, the ability to negotiate a consensual settlement may be extremely limited. No other industry would agree to such high value contracts without lengthy discussions, usually involving lawyers, as to the contents. However, the insurance market would be unworkable if it followed suit.

OVER THE COURSE OF THE LAST 10 YEARS, WHAT FACTORS HAVE BEEN A CATALYST INCREASING THE NUMBER AND COMPLEXITY OF INSURANCE DISPUTES? The last 10 years have seen dramatic changes on the world stage from increased globalisation and increased international business, to economic turmoil and increased regulation.

Tight margins and the need to make capital work impose greater pressures on the market to generate real returns for their capital providers. The economic downturn has led to government spending cuts, the sovereign debt and Eurozone crises as well as a changing legislative and regulatory landscape.

At the same time, there has been a perceived increase in threats such as fraud and cyber risks. In tough economic times, the incidence of claims and types of claim (fraudulent claims, for example) always increases. Additionally, the last 1o years have seen several other major world “insurance” events such as the fall out from the World Trade Centre, wars in the Middle East, the volcanic ash cloud, frequent severe hurricane events, the Japanese nuclear disaster, and even more recent the Thai floods, which have all had and will continue to have a major insurance and reinsurance impact. Such events lead to considerable insurance losses and claims, particularly reinsurance claims, many of which gravitate towards the London market.

INSURANCE AND REINSURANCE CLAIMS TRANSCEND BORDERS, HOW DOES CMS AND YOUR TEAM KEEP UP TO DATE WITH INTERNATIONAL REGULATION?

ACQUISITION INTERNATIONAL

We have a dedicated staff whose primary focus is to keep us up-to-date with developments within the insurance and reinsurance market including regulation. We also provide external updates by way of our LawNow service (short articles on key topics and developments) (www.law-now.com) and our RegZone, a free online regulatory service and knowledge bank (http://www.law-now.com/regzone/) as well as via a regular seminar program. More importantly, our insurance partners and associates across Europe and our CMS network are not a virtual team they are a real team, meeting together regularly and discussing the international and global nature of our clients’ businesses and the global challenges that our clients face in the jurisdictions that we cover. We have real international and global knowledge of this sector and share this information with our clients. This cross border spread of expertise and knowledge is unique for any law firm in this sector WHAT ARE THE KEY CHALLENGES IN HANDLING COMPLEX AND SENSITIVE DISPUTES FROM AROUND THE WORLD AND HOW DO YOU OVERCOME THESE HURDLES? The first legal challenge is to establish the relevant forum and law for the dispute. Many London Market policies are silent as to law and jurisdiction, often leading to preliminary hearings to establish where a dispute should be heard and what law it should be subject to. The key business challenge is to provide an early evaluation of the merits, recommended commercial resolution objectives and a strategy for the clients, which is, of course, the key imperative. Often that throws up one of the next major legal challenges, the identification and early assembly of the necessary admissible evidence to present to parties in mediation or settlement discussions or before any court or tribunal. Where issues and problems are global in nature, the cultural differences and experiences of clients in their own jurisdictions need to be understood. Any issues that arise due to the different jurisdictions need to be clearly explained so that the clients understand the issues. Insurance and legal terms often do not have the same meaning in different jurisdictions and experts will often be required to inform the Court about foreign practices. It should also be borne in mind that obtaining evidence from witnesses and experts based abroad takes longer and is more problematic than obtaining evidence from a witness or expert domiciled in the UK. IN YOUR OPINION WHICH METHOD OF ADR IS MOST THE COST-EFFECTIVE AND SUITABLE TO THE INSURANCE INDUSTRY? AND HOW DOES THIS CHOICE VARY ACROSS INDUSTRIES AND DIFFERENT TYPES OF DISPUTE? The vast majority of the insurance disputes that we see relate to disputes between sophisticated parties, whether they be members of the insurance market (insurers, brokers etc) or sophisticated insureds (e.g. banks/ big businesses). In these cases, the most cost effective dispute resolution is, of course, commercial negotiations, often undertaken by the broker. This can lead to an effective resolution of the issues without much

external - as opposed to in-house legal support and without recourse to a more formal dispute resolution tool. Where such commercial negotiations fail, mediation is a viable alternative and, depending on when used, can be a cost-effective solution.

However, mediation can have its downfalls (over-lawyering, mediator’s experience etc). That said, the insurance market and their legal advisers are heavily experienced and savvy operators of mediation with the ability to extract value from the process. Indeed, ADR could have been made for the insurance market and mediation is particularly valuable for international disputes where different legal landscapes make litigation and arbitration undesirable. The insurance market, including its members and legal practitioners, are now highly skilled in making mediation a viable means of dispute resolution even for the most highly complex cases.

HOW CAN YOU HELP YOUR CLIENTS TO DRAFT THEIR CONTRACTS AND ANTICIPATE DISPUTES BEFORE THEY’VE EVEN HAPPENED? WHAT OTHER ADVICE DO YOU OFFER YOUR CLIENTS? While not every eventuality can be accounted for, the key to avoiding disputes is to ensure that contractual documentation is as comprehensive as possible. The insurance market’s drive/requirement for contract certainty in the production of insurance documentation underscores that. We frequently help insurers and brokers to produce policies, terms/clauses and other contractual documentation that are often complex group policies and/ or products of worldwide application that are of significant innovation.

Name: Stephen Netherway Email: stephen.netherway@ cms-cmck.com Telephone: 020 7367 3000 Name: John Cadman Email: john.cadman@ cms-cmck.com Telephone: 020 7367 3000

Name: Alaina Wadsworth Email: alaina.wadsworth@ cms-cmck.com Telephone: 020 7367 3000

Company: CMS Cameron McKenna LLP Web: www.cms-cmck.com Address: Mitre House, 160 Aldersgate Street, London, EC1A 4DD

April 2012 /

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SECTOR SPOTLIGHT:

Resolving Disputes in the Insurance & Reinsurance Industry

RESOLVING DISPUTES

— in the Insurance & Reinsurance Industry

Insurance and reinsurance is one of the most contentious industries out there and the total number of insurance disputes continues to rise year on year.

From pre-contractual disclosure and policy drafting, coverage claims, reinsurance disputes, M&A related commercial disputes, political risk, warranty/indemnity/ liquidated damages insurance to the mis-selling of policies and claims; there is simply a midfield of potential clashes.

Acquisition International speaks to dr. Károly Bárd retired partner and dr. Erika Bérdi attorney at Cseri & Partners Law Offices and Dr. Károly Bárd is hon.ass.professor, Ho. President of the International Association of Insurance Law (AIDA), President of the Hungarian AIDA Chapter, for decades chief legal advisor of the Hungarian State Insurance Company, for years Insurance Commissioner of Hungary.

The complexity of insurance products (bank-insurances, unitlinked life insurances), the bigger financial-sensivity as well the increasing “legal culture” of the insured, the increasing activity of the legal aid insurer, and the different regulations for consumer protection incl. different techniques of resolving disputes. The financial crises increased the number of disputes in connection with the risky insurance products, due to enormous losses.

INSURANCE AND REINSURANCE CLAIMS TRANSCEND BORDERS, HOW DO YOU AND YOUR TEAM KEEP UP TO DATE WITH INTERNATIONAL REGULATION?

Dr. Erika Bérdi is an associate to the law office, she advised insurance companies performing cross board activity in Hungary via FOS (freedom to provide services). She is vicesecretary of the Insurance intermediary working group at the Hungarian AIDA Chapter.

Language knowledge of the staff is important, such as regular connection with co-operating law firms abroad, PEOPIL (Pan-European Organization of Personal Injury Lawyers) membership, regular attendance at AIDA congresses, conferences, and fluent attention to the changes of the foreign and inland practice, state supervision recommendations.

Further, English and German speaking staff is specialized to insurance, compensation - litigious and out of court – matters, providing services, mainly to foreign institutional clients, legal aid insurers. So these types of cases, i.e. insurance, resolving disputes have priority in the activity of the law firm.

The EU Directive – the possibility to enforce the rights of abroad suffered damage in their own country, facilitated and increased the claims started against the insurer, but on the on the other hand decreased the number of the mandates got from foreign clients.

“Our clientele comprises mainly Hungarian and foreign institutional clients (insurance and insurance intermediary companies, car dealer and service networks regarding the extended warranty), and the legal aid insurances, automobile clubs are forwarding the private individual clients.

WHAT ARE THE KEY CHALLENGES IN HANDLING COMPLEX AND SENSITIVE DISPUTES FROM AROUND THE WORLD AND HOW DO YOU OVERCOME THESE HURDLES?

WHY IS INSURANCE AND REINSURANCE ONE OF THE MOST CONTENTIOUS INDUSTRIES OUT THERE? There is different interpretation, partly as worldwide tendency, partly connected with the special Hungarian development.

Generally, i.e. worldwide the situation is influenced by the superiority in power of the insurer, the unequal position of the parties, the weaker position of the insured and/or damaged party, the bigger financial source of the insurers to start legal disputes, the material interest of the insurer to delay the payment, the dominant role of the re-insurers.

The knowledge of the law and socio-economic circumstances (prices, incomes etc.) is governing the case, with the assistance of connection abroad (see point above.) The law usually allows the parties the free choice of law, however some imperative regulation as per the local law of the customer shall be complied with – this can make the interpretation of the single cases complex and difficult.

HOW DIFFERENT IS THE APPROACH TOWARDS DISPUTE RESOLUTION WITHIN THE INDUSTRY NOW COMPARED TO THE EARLY NINETIES?

E.g. the insurers (re-insurers) prefer enter in dispute in claims of big amount, often waiting the final result of the official investigation, however the responsibility and payment obligation of the insurer (reinsurer) is clear.

The need of professional assistance in dispute resolution connected with the complexity of the insurance products, increasing activity of the different legal aid (assistance) companies, the increasing legislation concerning consumer protection incl. disputes resolving methods and organs avoiding the general court procedures.

A specific Hungarian explanation (as well in other former socialist countries) is that during decades state monopoly insurance company acted, and although the legal expenses (court costs too) were low but also the legal culture, so the claimants preferred the so called plaint procedure, regulated by the law. But now the tendencies become slowly the same as in the Western countries.

IN YOUR OPINION WHICH METHOD OF ADR IS MOST THE COST-EFFECTIVE AND SUITABLE TO THE INSURANCE INDUSTRY? AND HOW DOES THIS CHOICE VARY ACROSS INDUSTRIES AND DIFFERENT TYPES OF DISPUTE?

OVER THE COURSE OF THE LAST 10 YEARS, WHAT FACTORS HAVE BEEN A CATALYST INCREASING THE NUMBER AND COMPLEXITY OF INSURANCE DISPUTES?

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The mediation as weapon of free choice of the parties and/ or the increasing recourse of the different official dispute resolution organs, where the decisions, recommendations are accepted and adopted by experts of the insurance industry. Key

is, in our opinion, the unilateral acceptance of the decisions of these organs by the insurers, at least until a certain amount and in disputes started by the consumers.

WHAT ARE YOUR PREDICTIONS REGARDING UP AND COMING ARBITRATION SEATS IN 2012?

One of the most important aims is the further development, expansion in the harmonization of the different regional rules (EU, USA, Asia, Australia, and South-America). Further the closer contact (harmonization) between insurers and their reinsurers also concerning the provisions on dispute resolution.

From a sector perspective, we expect the commodities sector to continue to be busy.

The activity here may not simply be plain vanilla M&A but is likely to be, for example, an equity investment coupled with a supply agreement, which is intended to secure supply. Any sectors that are fuelled by the growing middle class and aging populations in the emerging markets will also be hot spots.

Insurance and healthcare are likely to be the most likely beneficiaries of this macro-trend.

Name: Dr.Károly Bárd Email: drbadk@gmail.com Address: H-1052, Budapest, Régiposta u. 14.

Hungary Telephone: +36 1 3372655

Company: Cseri&Partner Law Office Name: Dr. Erika Bérdi Email: drbardk@gmail.com Web: www.parallellaw.hu Address: 1013 Budapest, Krisztina krt. 39/B Telephone: +36-1-489-2020

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Resolving Disputes in the Construction Industry

RESOLVING DISPUTES — in the Construction Industry

Over the past 10 years, disputes in the building, engineering and construction industry have increased in number and become more and more complex. Construction disputes can be frustrating, upsetting and time consuming; the contracts tend to be poorly drafted and can have arduous conditions, and projects can be badly managed making delays, additional costs and liabilities unavoidable. Another marked change over the same time span is the complete sea change in the way in which we resolve these disputes, with the traditionally favoured litigation being replaced by arbitration, mediation, adjudication and dispute resolution boards. The ability to avoid dispute is perhaps even more important than managing them so it is essential to get the best contract arrangements in place, this also makes it easier should any potential problem arise. Along with dispute resolution, advice may include: pre-tender and post-contract advice, risk assessment, delay analyses and final account preparation. This feature invites a number of leading dispute resolution experts who act for a broad range of clients, from private individuals to international property developers to share and promote their expertise. We aim to give our readers and rare opportunity to benefit from the skill of the world’s leading solicitors, mediators and arbitrators and provide a thorough update and insightful commentary on the topics that are currently affecting the industry. Some of the topics we’ll be touching on include: the practicality of enforcing clauses in cross-border disputes, up and coming arbitration seats, challenging public procurement decisions, how to enforce nonstatutory adjudication decisions and cash flow considerations when managing major disputes. Acquisition International speaks to the experts.

Angus Pearson is a Director of Atlas responsible for the Construction Disputes Group, who is regularly called upon to represent Parties embarking upon or already engaged in a Dispute Resolution process, be that Adjudication, Mediation, Arbitration or Litigation. There is no typical Atlas Client, as they have been appointed by Employers, Contractors and Specialist Sub-contractors alike. At Atlas, we practice Dispute Avoidance wherever possible. We assess the likely impact on both sides by a formal process. Thereafter, we bring the Parties together for an informal “Without Prejudice” meeting to establish common ground and stimulate a settlement. The obvious benefits are the

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time and cost savings coupled with preserving the commercial relationship of the Parties. This is an approach our Clients enjoy and gain from our impetus to achieve a prompt and amicable settlement, rather than hastily “going nuclear”, with the substantial costs and draw on resources such entails. However, in many cases, a formal process becomes inevitable.In the UK over the last decade, Adjudication has really taken off.

Last year, the Construction Act was amended introducing a few minor improvements to the Adjudication provisions as the process has grown from infancy to adolescence. Adjudication is better suited to the smaller disputes as it is a relatively fast-track and cost effective process when compared with Arbitration or Litigation, however it is limited by timescales and there is rarely opportunity to engage Experts to assist in any complex matters. Mediation is less favoured as the decision is not usually enforceable and if the Parties are not wholly committed to the process, it is likely to end up in further formal tribunal.

Arbitration (particularly for international projects through the ICC) and Litigation are more conducive to larger, more complex disputes. Atlas has been involved in multi million dollar disputes in litigation on behalf of major international businesses as well as small Adjudications for tens of thousands for smaller contractors. The sums at stake vary significantly, however construction disputes are usually occasioned by the same factors; poor contract drafting or one party simply not paying the other, or a combination of these two factors.

The challenge is to understand the nexus of the dispute then navigate a clear contractual or legal path to favourable resolution.

Bringing clarity to claim documentation, backed up with records and factual analysis assists the Third Party in understanding the case. Make it easy for the person in the

chair. It is sometimes more effective for the Claimant to frame the dispute on a narrow point upon which the remainder of a larger claim balances.

A prompt decision on such a point can pave the way (or not!) for a subsequent process, without incurring the costs in preparing the full case from the word “go”. The global downturn in the construction industry has resulted in numerous contracting parties having to fight for every penny. This is reflected by the proliferation of construction disputes, in which the lawyers are usually the only winners. As an industry, Construction spends almost as much on legal expenses as it generates in net profit.

We have to embrace the various formats of DR and strive to achieve swift, cost effective, and appropriate justice for all parties to a dispute. The economic climate ensures that the Atlas team’s expertise and experience with Construction Contracts and Construction Law which will continue to be in demand by Clients in matters of dispute for the foreseeable future. Angus (Gus) Pearson is a Director of Atlas Commercial Consultants Ltd. and heads up the company’s dispute avoidance and resolution group. He is a Member of the Chartered Institute of Arbitrators, the Society of Construction Law and the Association of Independent Construction Adjudicators. He frequently acts as Party Representative in Construction disputes in the United Kingdom and Overseas.

Company: Atlas Commercial Consultants Ltd. Name: Angus Pearson Email: angus.pearson@atlasuk.biz Web: www.atlascommercialconsultants.com Address: Atlas Commercial Consultants Ltd. 22 Prospect Place, Welwyn, Hertfordshire AL6 9EN Telephone: +44 7974 740272

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SECTOR SPOTLIGHT:

Corporate Imigration Review

CORPORATE IMMIGRATION — Review

The prevailing global economic uncertainty of the past few years has ignited significant debate across the world’s media and political classes on the desirability of bringing foreign nationals into local jurisdictions to participate in local labour markets. Immigration remains at the forefront of political debate across the globe.

Washington DC / United States of America

Political campaigns in numerous countries have been dominated by immigration policy. It is therefore imperative that business professionals seek the right advice from the right people in order to remain informed and updated with current procedures and processes. Acquisition International speaks to Allen Orr, the founder of Orr Immigration Law Firm.

FICO, Chipotle, and Walmart have led companies to put greater focus on ensuring compliance with work authorization requirements.”

Orr Immigration Law Firm specializes in corporate immigration law with a particular focus on compliance and investigations. The firm’s service differs from most competitors based on our experience managing immigration both as corporate counsel and as outside counsel. This allows us to provide appropriate training and guidance to help corporations manage risk and to align policies to best practices in industry.

“Orr Immigration assists with the immigration implications of all forms of corporate reorganization, including closures, acquisitions and spinoffs.

We begin by assessing the immigration risk for corporations and their affected foreign workforce during a corporate restructuring. We evaluate work authorization for the complete workforce and suggest solutions for foreign nationals regarding visa status, including those who may need special consideration due to having started the permanent resident process, generally known as the green card process.”

“Our clients range from large multinational companies to small start-ups, but their fundamental needs are the same: to achieve immigration compliance. Since June 2009 the Department of Homeland Security and the Department of Labour have increased scrutiny of visa applications, and have dedicated greater time and resources to investigations and audits. A record number of companies have had their I-9 forms examined against Homeland Security databases to verify worker eligibility, with fines totalling close to 60 million dollars over the last two years.

For our practice, the issue is not recent changes in the law but recent changes in the enforcement of existing policies. This has affected clients’ bottom line and led to revisions in recruiting and hiring practices. For example, the public embarrassment, criminal indictments, and civil and criminal fines resulting from investigations into companies like

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/ April 2012

HOW DOES YOUR FIRM ASSIST PROSPECTIVE CLIENTS IN ASSESSING THE IMMIGRATION IMPACT ON A CORPORATE REORGANIZATION?

Most immigrant workers in the US face the job market test in order to achieve permanent residence (green card). With high unemployment in a large number of industries (outside of engineering), permanent residence is becoming more difficult to achieve.”

WHAT ARE YOUR THOUGHTS REGARDING THE GLOBAL POLITICAL DEBATE OVER THE DESIRABILITY OF BRINGING FOREIGN NATIONALS INTO LOCAL JURISDICTIONS TO PARTICIPATE IN LOCAL LABOUR MARKETS? “The US immigration debate is interesting. Congress must find a way to redefine business visa categories to meet the need and demand for skilled workers to support innovation and growth within key sectors of the US economy while also incorporating the millions of undocumented potential workers in low skill jobs.”

WHAT IMPACT HAS THE CURRENT ECONOMIC CLIMATE HAD ON BUSINESS IMMIGRATION PROCEDURE WITHIN YOUR JURISDICTION? AND HOW HAS IT AFFECTED THE NUMBER OF APPLICANTS AND THOSE WHO WERE ALREADY IN POSSESSION OF A VALID VISA? “The relatively weak economy and high level of unemployment have affected the adjudication and implementation of new policies in the US, including the criteria for specialized knowledge in the L-1B context. In addition, increased processing times and fees have caused many employers to reassess the advisability of opening and maintaining operations in the US when other jurisdictions such as India, Mexico and Canada may be more accommodating.

Company: Orr Immigration Law Firm P.C. Name: Allen Orr Web: www.orrimmigration.com Address: 1425 K Street N.W. Suite 350 Washington DC 20005 Telephone: 1.202.587.5738

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Mediation — The Future for Corporate Disputes

MEDIATION

— The Future for Corporate Disputes

Acquisition International speaks to Les J. Weinstein Esq. arbitrator and mediator serving on the AAA, ICDR, CPR, CIAdr and WIPO panels.

“Additionally I serve as a panel mediator for the US Federal District Court and The US Court of Appeals for the Federal Circuit. In addition, I am the Director of ADR Services for DecisionQuest,Inc. , the leading dispute resolution research consulting firm to law firms and companies.

When I was in private law practice, I served as counsel to an international clientele in litigation, arbitration and mediation matters. For the last 10 years I have been focused on serving as a neutral mediator and arbitrator in technology, intellectual property, competition, antitrust disputes and complex business disputes. I am a US Patent Office Registered Patent Lawyer with a degree in engineering.”

My view is that each case that comes to mediation is a unique composite of facts, law, personalities and circumstances that defy gross generalities or a one size fits all approach.

I try to tailor my efforts to the individual case specifics including, but not limited to, the views of counsel who know their case and clients better than I can, consideration of the direct and indirect financial, personal and business costs in litigant, employee and executive time, the stakes presented, the needs and goals of the parties, the estimated time to a final adjudicated decision (including a possible appeals) and the anticipated direct and indirect out of pocket costs, the risks and benefits involved. Last but not least, there is often great value in achieving peace, if not harmony, among the litigants.

Cases are fact, law and party dependent. Flexibility in reaching an agreed upon resolution tracks the specifics at hand.

Active listening is a mediator’s best tool. I seek, when possible, to come as close as possible to achieving a “win-win” solution. And I am ever mindful that in litigation or arbitration, a net lose-lose outcome all too often results because of the time and costs expended.

I view mediation as a joint and collaborative effort by the mediator, counsel for the parties and the parties. To try to avoid impasse, I do not hesitate to make an invited mediator’s proposal when asked to do so by all sides. Nor do I shirk from shifting to an evaluative style if it becomes appropriate as a

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mediation progresses going beyond the customarybut not always- facilitative beginning.

I take it as my responsibility to be well prepared before the start of the mediation. Prior to the scheduled mediation date, I usually spend time talking individually with counsel as well as reading the relevant case specific documents and other materials and the mediation briefs furnished by counsel. I normally insist that all party representatives who attend the mediation have read the briefs of all sides beforehand. Party decision makers (and their insurers when there are any) must be physically present. In addition, I invite, but do not require,” Mediator’s Eyes Only” confidential statements.

I recognize that parties are entitled to their day in court or arbitration if they so choose and I try not considering it a personal failing or a system failure if there is a true impasse. I try to remain mindful of the fact that the mediation is not about me and, if I do my very best, failure to reach agreement is not a defeat for fairness, justice or me. That is why courts and arbitration tribunals exist as adjudicating forums. If mediation does not result in settlement and the matter is in or headed to a court trial, I will often suggest to the parties that they at least consider arbitration as a superior alternative.

Companies and individuals usually seek my arbitration and mediation services to resolve technology, engineering, intellectual property (including patents), monopoly/competition/ antitrust related or other complex business disputes.

The benefits they seek in engaging me is that by reason of my expertise, experience and education, they expect that I can often more effectively assist them in reaching a mutually satisfactory and creative result and frequently one where they both sides achieve value sometimes either saving or creating a sound business contractual or licensing relationship.

The parties also recognize that my style tends to take the emotion out of a dispute, which has turned bitter and as such inhibits resolution.

I can best assist the parties by being fully prepared and consulting with counsel and their clients before the mediation begins, being a good listener during the proceeding and maintaining the confidences shared with me. My skills enable me to understand when the parties should meet jointly and when to proceed only in caucus. A practice I use is to ask the parties, when appropriate and helpful, to also bring in witnesses or experts to assist in the mediation process Because litigation and even arbitration should be considered a last resort, there is every reason to include an appropriate provision in virtually every contract. Because so few filed court cases actually

go through trial, a civilized society requires that parties negotiate first and mediate before resorting to proceeding with adjudication, I very strongly suggest that a mediation provision be provided for in virtually ever contract be it domestic, cross border or international.

From my perspective, the global downturn has lead to more reliance on ADR than before. Company counsel and their law firms have come to have greater respect for “mediation –first” and arbitration over court adjudication. The trend toward the much discussed “disappearing trial” has been lead by several forces including: A. The large cost of trials and much arbitration.

B. Globalism and the growing international nature of business and the reluctance of a company to submit to the courts of a foreign jurisdiction, C. The length of time to a final decision of adjudicated disputes and the consequent business uncertainty that hinders planning. Large civil court budget cuts have significantly aggravated the delays to getting a court trial date.

D. The need for confidentiality businesses desire or need for their proprietary information and the need to avoid adverse press or other publicity, which can harm their business The incorporation in contracts and use of mediation as a remedy is rapidly accelerating. Mediation will soon become standard operating procedure in the US and elsewhere now that almost all courts require it in almost all pending cases. Litigation will decline and mediation (and arbitration) will, soon be the primary means of dispute resolution taking the “A” out of “ADR”

Company: DecisionQuest Inc. Name: Les J. Weinstein Email: lweinstein@decisionquest.com Web: www.decisionquest.com Address: 1026 N. Tigertail Rd, Los Angeles 90049, USA Telephone: 1-310-476-0655

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SECTOR SPOTLIGHT:

Business Crime — Jurisdiction & Regulations

BUSINESS CRIME

— Jurisdiction & Regulations

Andrew Mitchell QC is the Head of Chambers at 33 Chancery Lane, The Chambers of Andrew Mitchell QC. He talks to Acquisition International about the jurisdiction and the regulations involved. they have up-to-date compliance systems in place in order to avoid falling foul of regulators and facing the negative commercial implications of publicised breaches of money laundering or bribery rules.

Fines can be in the GBP millions and more importantly confiscation can deprive the company or individual of everything it obtained as a result or in connection with the criminal conduct without any deduction for anything that might have been paid away (tax, costs of sales etc) - it is a factor of what is obtained not what is retained.”

HOW ARE YOU ABLE TO ASSIST PROSPECTIVE CLIENTS IN PROTECTING THEMSELVES AGAINST FRAUD, BRIBERY AND CORRUPTION? The Chambers is able to assist prospective clients in protecting them against fraud, bribery and corruption and provides ad hoc advice on specific compliance issues as well as an audit of a business’ compliance procedures followed by a tailored programme of improvements and training with on-going periodical reviews to ensure that changes in regulations are incorporated.

Andrew Mitchell QC / 33 Chancery Lane

Andrew specialises in advice and advocacy (oral and written) across regulatory, civil, public inquiries and criminal issues relating to commercial wrongdoing.

He elaborates: “I specialise in advising people and entities concerned with “commercial wrongdoing” and am also considered pre-eminent in the field of the recovery of the proceeds of wrongdoing, advising alleged wrongdoers, governments and third parties. My practice engages me internationally and domestically. I lecture and have acted as a consultant for many training programmes worldwide in the areas of bribery and corruption and the proceeds of wrongdoing. I have trained and mentored the judiciary on these issues in England, the Caribbean, Australasia and Africa. The Chambers has a history of Business Crime representation, including Claimants and Respondents, Defence and Prosecution, individuals and companies - advising and litigating on issues relating to bribery and corruption, fraud and money laundering.

“We currently represent prosecuting agencies in their pursuit of assets within the UK as well as representing clients worldwide seeking to secure assets,” explains Andrew.

“We act in proceedings taking place in the Supreme Court, Privy Council, Court of Appeal (Civil and Criminal Divisions), all Divisions of the High Court and the Crown Court. Cases range from employee frauds to multi-billion pound company frauds.”

ACQUISITION INTERNATIONAL

We also act in other jurisdictions and are well equipped to assist and advise in proceedings in those jurisdictions, working with local attorneys as appropriate.

The Chambers certainly stands out from the competition as it provides the skills and experience essential for domestic and international litigation involving commercial and financial wrongdoing of every type.

“A typical Claimant will consider the commercial reality of the pursuit of their ‘lost’ assets,” continues Andrew. “In these lean times they will need to consider the time and cost of pursuing a Respondent and the likelihood of either success in proceedings or the practicality as to whether they will be able to recoup their losses following litigation. Similarly, a Respondent will need to consider the time and financial cost of defending proceedings.

The process of litigation can have a major impact on the ability to efficiently run a business. Stricter regulation means that clients need to make sure that

Although there have been no recent significant changes in the regulation of Business Crime law, there has been a tightening of the need for compliance. For example, the Bribery Act is now very much part of the English statutory landscape and has resulted in a fresh approach to compliance.

The downturn in the world economy has led to a closer inspection of working practices and an increase in action as Governments and regulators seek to use commercial wrongdoing as a way of raising extra public money.

“Like in all areas where downturn bites – wanting more for less – which is making us leaner and makes the Chambers model of legal practice more attractive – because it has lower overheads.”

33 CHANCE RY LANE

Company: Chambers of Andrew Mitchell QC Name: Andrew Mitchell QC Email: arm@33cllaw.com Web: www.33cllaw.com Address: 33 Chancery Lane, London WC2A 1EN Telephone: +44 (0) 20 7440 9950

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SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review

ACQUISITION INTERNATIONAL’S — 2012 Q1 Review

2011 proved to be a somewhat turbulent year with international M&A volumes decreasing by 14% in the final quarter of the year compared with Q3 2011 and down 18% compared to Q4 2010. The automotive industry was the only sector to see deal volumes and value increase within Q4, although Media & Entertainment, Mining & Metals, Oil & Gas and Power and Utilities all saw a rise in deal value from Q3.

At the close of the year, many predicted that 2012 would prove to be a strong year for M&A activity across a number of sectors and that many economies would be seeing signs of recovery. The first quarter so far has seen a strong start for the Oil & Gas sector (a trend which is likely to continue) and also the IT Services industry, which closed 2011 on a strong note, again set to continue through 2012.

The Financial Services sector is expected to represent 37% of global M&A activity in the year ahead and 39% in the next five years, a significant percentage of the €250bn rise in value of global M&A expected in 2012, bringing the total value of activity to nearly €2trn, a 14.5% leap from 2011. Acquisition Internationals speaks to the experts.

WHICH SECTORS PERFORMED BEST OVERALL IN YOUR JURISDICTION OVER THE COURSE OF 2011 AND HOW DOES THIS COMPARE SO FAR TO Q1 2012? WHAT ARE THE PREDICTED HOTSPOTS FOR 2012?

“In 2011 the financial sector and instruments witnessed a considerable growth and healthy dealings, also industrial mergers and acquisitions were doing quite well as the prices and remunerations were corrected after the boom pre 2008. Q1 2012 is still unpredictable, and the variable in the whole region is high, but the sector of renewable energy started to pick up and we expect a quantum leap throughout 2012 and 2013.”

Thaer Najdawi is the Managing Partner of A&T Najdawi Law Office, the office handles a variety of legal services and representations where the team is skilled in all respects of legal practice.

Juan Carlos Castillo Chacon is a partner at Aguilar Castillo Love, based in Guatemala, he comments on the strengths of his team: “Our key strengths are our ability to work on a regional basis, coordinating big, multi jurisdiction acquisitions, and our profound knowledge of the areas in which we work.

“Our broad practice area and multi individual skills provide us with the thorough knowledge needed to peruse various aspects in conducting due diligence reports and enlighten the potential acquirers of businesses about the risks and liabilities derived from the investment in that specific area and from the conclusions reached during the Due Diligence.

We are also capable of facilitating the acquisition procedure in the area of M&A. We guarantee our clients over 41 years of experience in local and international dealings and legal expertise.

“We really understand the business and therefore are capable of identifying key issues that could either affect the decision to buy or the price. Ours is not a mechanical, checklist kind of work. Although we have not received any award specifically for our M&A practice, we did win a client service award for Central America and the law firm of the year for Honduras, in 2010 and 2011, respectively. Both awards were given out by Chambers & Partners.”

The long established reputation and experience of our Office has allowed us to become one of the most sought for Firms in Jordan to conduct business dealings, due diligence reports, and facilitate acquisition structures and deals. We are known for our swift action and excellent timely performance of the services.

Furthermore the rich and thorough knowledge of the team brings to the table the instant insight and faith by opponent while debating and negotiating a deal. We also are able to identify and locate the risks and potential liabilities as they emerge or signal. In addition to that, and since we are advising, or restructured a considerable number of public entities, a great confidence is built around the Office, and therefore makes it easier, quicker and more appealing to implement and execute.”

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WHAT EXPERIENCE AND EXPERTISE DO YOU BRING TO THE TABLE DURING A TRANSACTION, AND HOW DOES THIS ASSIST IN GETTING DEALS THROUGH TO COMPLETION? “As explained above, we have a strong background and expertise in certain areas, but above all we understand business and businessmen and therefore we are able to stand in their shoes and identify the real key issues in any transaction. Most of the M&A work is a mechanical process of going through a checklist made for all companies and all businesses.

We provide real value added and not just a list of more or less irrelevant issues from a business point of view. We also understand that lawyers should not be mere obstacles for the closing of a transaction and therefore do not bring to the table minor findings that do not materially affect the business.”

WHAT PATTERNS AND LEVELS OF TRANSACTION ACTIVITY HAVE YOU WITNESSED IN YOUR JURISDICTION THIS QUARTER? HOW HAS Q1 2012 COMPARED TO Q1 2011?

“We are seeing more competition, but also more activity. However, fees are trending lower and companies are more interested in fixed fees arrangements. Q1 2012 has been a lot better than Q1 2011. We believe 2011 was an election year in Guatemala and that delayed some investment decisions. WE believe that to be over and for 2012 to be a much better year.”

Marie Antoinette Airut is Managing Partner at Airut Law Offices. The Firm’s main areas of expertise in M&A include Banking and Finance, Construction and Real Estate, Oil and Gas, Telecommunications, Insurance, Manufacturing; and Pharmaceuticals.

“Since its inception Airut Law Offices has been evolving around straightforward values: quality, efficiency and creativity. Knowing the reputation of the Partners as well as the Associates, quality has always been the cornerstone of the firm’s values.

The firm’s professionalism goes far beyond the high standard legal services provided to the clients, to reach a high standard relationship with those latter based on ethics, transparency and trust. Clients praise the personalized relationship and the tailored work, provided through the full dedication of the firm’s team to each client’s needs.”

MARIE HOW LONG ARE DEALS TYPICALLY TAKING TO COMPLETE AND HOW ARE THEY BEING FUNDED? “The duration of deals varies a lot in the Middle East.

Some deals are done within 3 months while some others take more than a year. Most deals are funded through equity financing. Some others are financed through bank loans.”

SO HOW EASY IS IT TO DO BUSINESS IN YOUR JURISDICTION – FOR EXAMPLE ATTRACTING NEW INVESTMENT, SETTING UP A NEW BUSINESS, GETTING ACCESS TO BANKING AND CREDIT FACILITIES? “Lebanon is known for its business-friendly environment. It encourages Foreign Direct Investments through its Investment Laws and

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review Regulations and its developed Banking services.

Moreover, the incorporation of companies in Lebanon is quick (48 hours) and foreign ownership restrictions are limited. As for Iraq, it has developed since the end of the war a very open economy. There are no foreign ownership restrictions in relation to companies. Furthermore, Investment Laws are up-to-date and have encouraged investors in doing business in Iraq over the past years.”

Petr Suchý is an attorney at law and Managing Associate at Ambruz & Dark / Deloitte Legal, who specializes in finance law, corporate law, companies’ transformations and mergers & acquisitions.

Petr has worked as a team leader on a number of large restructuring projects and acquisition transactions across most of industries, namely financial services institutions, real estate investments and manufacturing. He comments: “Our key strengths are teamwork, close collaboration with other Deloitte functions, namely tax and financial advisors, capabilities of handling large and complex assignments and global network of affiliated law firms. Despite not winning any official awards in recent past, we gained truly high appreciation from many clients and especially these from clients working with “Magic Circle” law firms we value much more than any official award. As a firm we bring a wider business thinking beyond purely legal angle and understanding of tax, accounting and financial aspects of M&A transactions. Over the last quarter we advised one client on € 40 million transaction consisting in sale of electricity distribution network during the end of 2011/beginning 2012 and we currently work on buy-side of a transaction worth € 80 million.

SO HOW DOES YOUR FIRM ADD REAL VALUE TO THE DEAL? AND WHAT ARE THE FIRM’S GOALS FOR THE REST OF THE YEAR? “Our legal assistance goes far beyond simple completion of the transaction. From the first moment of drafting or reviewing the Letter of Intent, we always focus on future operation of the acquired portfolio. As an example, e.g., in the industry of Real Estate & Construction, of course we advise in close co-operation with tax and financial colleagues.

However, we have also team members with technical background in the relevant industry and we intensively consult them to structure the acquired assets portfolio, or, e.g., acquired local construction companies, in an efficient and profit-aimed way.

Consequently, we approach the client with relevant ideas and hints. Therefore, our services are not only legal advisory. It is business advisory indeed.”

HOW EASY IS IT TO DO BUSINESS IN YOUR JURISDICTION – FOR EXAMPLE ATTRACTING NEW INVESTMENT, SETTING UP A NEW BUSINESS, GETTING ACCESS TO BANKING AND CREDIT FACILITIES? “Czech Republic is indeed not amongst the most flexible jurisdictions. However we overcame the most problematic obstacles for business already several

ACQUISITION INTERNATIONAL

years ago and with forthcoming recodifications of private and corporate law I am confident that we will rank much higher in terms of business-friendliness.

And the other aspects mentioned – attracting investments, access to financing – the approaching developments in law can definitely improve that as well.”

Glib Bondar, Partner of Avellum Partners, and Kostiantyn Likarchuk is Partner of Avellum Partners, the legal experts in corporate finance, covering arbitration, banking and finance, capital markets, competition, mergers and acquisitions, real estate and restructurings.

“We are dedicated to delivering the highest possible level of service to our clients. We help foreign and Ukrainian investors to close complicated corporate finance transactions successfully and promptly. We reach this goal using the most advanced Western methods and practices coupled with our broad experience in Ukraine and everyday practice. Our partners are actively involved in every transaction.

We always search for practical and unique solutions for our clients.

We recently won several significant awards. In particular we have been named as Ukrainian Law Firm of The Year, Ukrainian M&A Law of the Year, Deal Maker of the Year and many others. We also knew that this year we were shortlisted for one of the most prestigious legal awards – The Chambers Europe Awards for Excellence.”

HOW EASY IS IT TO DO BUSINESS IN YOUR JURISDICTION – FOR EXAMPLE ATTRACTING NEW INVESTMENT, SETTING UP A NEW BUSINESS, GETTING ACCESS TO BANKING AND CREDIT FACILITIES? Despite certain positive steps towards improvement of overall legal environment (including, simplification of new companies registration process and liquidation of business, strengthening creditors’ rights protection, light liberalization of currency control), foreign business still would likely face certain challenges unknown in more developed economies or even most of emerging markets such as generally high new business “entry” costs, strict currency control, weak court system. In aftermath of financial crisis, there is not much appetite for Ukrainian risk which is multiplied by mix of economic, political and legal reasons. As a result, it is uneasy for Ukrainian businesses to attract new investment.

Due to situation on global financial markets, uncertainty in Europe (e.g., situation with Greece) resulting in European banks being very cautious about raking credit risks, lack of readily available local money supply from Ukrainian banks, currently Ukrainian borrowers have limited access to banking and credit facilities. Ukrainian companies who are leaders in their respective sectors have higher chances to get such access, in particular ECA-backed export financing. In additional, IFIs (such as Continued on next page...

Company: Najdawi Law Office Name: Thaer Najdawi Email: thaer@najdawilaw.com Web: www.najdawilaw.com Address: 60 Ahmad Bin Hanbal St. , AlWaibdeh, P.O.BOX 921260- Area Code: 11192, Amman-Jordan Telephone: 009626-4631111

Company: Aguilar Castillo Love Name: Juan Carlos Castillo C. Email: jcc@aguilarcastillolove.com Web: www.aguilarcastillolove.com Address: 7a. Ave. 5-10 zona 4, Centro Financiero, Torre 2, Nivell 11, Guatemala, Guatemala Telephone: +502 2495 7272

Company: Airut Law Offices Name: Marie Antoinette Airut Email: maairut@airutlaw.com Web: www.airutlaw.com Address: Sami El-Solh Avenue, UCA Building 8th Floor, Beirut, Lebanon Telephone: +961 1 391414

Company: Ambruz & Dark / Deloitte Legal Name: Petr Suchy Email: psuchy@deloitteCE.com Web: www.ambruzdark.com Address: Nile House, Karolinská 654/2, 186 00, Praha 8 – Karlín, Czech Republic Telephone: +420 246 042 925

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SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review EBRD and IFC) would likely remain the most active suppliers of debt financing (or combination of debt and equity financing).

HOW HAVE YOU BEEN AFFECTED BY THE MAJOR REGIONAL CATASTROPHES (FOR EXAMPLE THE EUROZONE DEBT CRISIS, THE SLOWDOWN IN CHINA AND INDIA ETC.)?

“Yes, Ukraine was affected quite severely. Most Western banks closed their lending limits for Ukraine and foreign investors concentrate on their home markets being reluctant to invest in the market with increased degree of risk.”

Allen & Overy Paris is more than 150 lawyers across very diverse practice. Adrian Mellor is an international finance partner working on acquisition finance transactions. Jean Christophe David is a French counsel specialising in leveraged finance transactions.

Jean-Christophe David: “Senior/Mezzanine inter creditor relationships are the current hot topic.

Sponsors are doing “all senior” financing structures on the assumption that it will be difficult to reach an agreement between senior and mezzanine creditors within a short time frame. Senior/Mezzanine inter creditor relationships must still be standardized in France (as it is the case elsewhere in Europe). Over the last two years we have been involved on more than a third of the senior/mezzanine deals which have successfully completed. Given that we have been acting on these deals advising all positions

(senior, mezzanine, sponsor) we feel we are in a good position to find the right compromises.

The depth of our banking practice in Paris (7 partners, 40 associates) enables us to advise on all aspects of the financing (securitization, high yield, asset financing, real estate financing, export financing, etc.). In the current market, it is key to offer a large range of banking services because the quantum of traditional acquisition leveraged financing may not always be sufficient for sponsors to close deals.”

Jean-Christophe David: “In particular we have been involved on two “bond thru loan” refinancing deals in France (PagesJaunes and Numericable. The other one being TDF which was signed but the bonds have not been issued yet). These structures enable the borrowers to refinance all or part of their senior facilities using high yield bonds which are structured as a new tranche under the existing credit agreement.

The purpose of this refinancing is to replace short term senior debt with high yield long term debt and incentivize remaining senior lenders to voluntarily extend the maturity of their commitments.”

WHAT MAJOR FISCAL POLICIES AND ECONOMIC REFORMS HAVE BEEN INTRODUCED AND WHAT ARE THEIR INTENDED OUTCOMES OVER THE COURSE OF 2012?

Adrian Mellor and Jean-Christophe David conclude: “French presidential elections are coming and so there is a certain level of uncertainty around some tax issues. There is particular concern over the new rules

that came into force on 1/2012 under which interest expense and certain other financial costs relating to the acquisition of shares are not tax deductible if the acquiring company cannot demonstrate that it took the decision relating to the acquisition of these shares. The precise effect of these rules and the impact on double Luxco structures is unclear and given the elections further guidelines may not be forthcoming in the near future.”

Gjergji Gjika is partner at the Tirana office of Drakopoulos Law Firm. Our firm covers all aspects of M&As, both in terms of legal work (due diligence, negotiations, agreements, closing, regulatory) and areas of expertise (Consumer Goods, Food & Beverage, Health & Medical, Real Estate & Construction, Tourism, Energy & Environment, IT, Telecommunications, Publishing, Media, Advertising, Sports & Entertainment, Banking & Capital Markets, Consulting, Logistics, Automotive, Defence, Manufacturing, Public Acquisitions etc.)

The M&A team are composed of specialised and client - oriented lawyers focused in achieving the client goals, rather than just pointing out what the law says.

Gjergji Gjika: “Our deep legal expertise is coupled with acute business sense, both of which are equally important in M&As. In terms of distinctions, please note that we have been nominated a top firm in terms of number of deals handled of a value of over $ 1 million in Emerging Markets. Moreover, our firm is regularly nominated firm of the year in areas such

LBO FINANCING PARIS

2011 Deals NUMERICABLE LABEYRIE MIC DELACHAUX

Our integrated approach is based on our lawyers’ expertise in Leveraged Finance, Restructuring, Mergers & Acquisitions and Tax. Thanks to our network, we can combine a multi-jurisdictional leveraged debt team with an extensive European and US capital markets practice. This enables us to provide our clients with a full service for senior, mezzanine and PIK debt, bridge-to-bond financings, bank/bond financings, high-yield debt offerings, securitisation take-outs and debt buy-backs and restructurings.

Our sector knowledge and understanding of our clients’ business objectives enables us to provide legal advice that truly meets those aims within the context of the overall rationale for the debt package. Lenders and borrowers alike need to be able to structure deals in ways that suit market conditions. Our lawyers can advise on any form of leveraged financing that our clients choose to undertake.

CONTACTS

Adrian Mellor Jean-Christophe David Tel +33 (0)1 40 06 54 00 Fax +33 (0)1 40 06 54 54 Allen & Overy LLP 52 avenue Hoche CS 90005 75379 Paris Cedex 08 – France www.allenovery.com

EMINENCE GOVOYAGES/ E-DREAMS/OPODO PAGESJAUNES MATERNE MONT BLANC CERBA EUROPEAN LAB QCNS EUROPE DISTRIPECHE

SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review as Corporate, Banking and Financing, M&As, IP etc., while we are a recommended firm in over 10 separate categories in Legal 500, as well as ranked in IFLR.” HAVE THERE BEEN ANY NOTABLE DEALS (SIZE, COMPLEXITY, DURATION, ETC.) THAT YOU’VE BEEN INVOLVED IN OVER THE LAST QUARTER IN ALBANIA? “During the last quarter, we have been involved in several deals, including acting on behalf of a listed Canadian oil and energy company in regards to the privatization of the State Oil Company of Albania, assisting the biggest airline company in Albania for an aircraft acquisition, advising on and negotiating the sale of an iron and nickel mine, assisting the largest hypermarkets company in the world with its entry in the Albanian market, etc.”

HOW POSITIVE IS THE OVERALL ATTITUDE REGARDING GROWTH AND DEAL OPPORTUNITIES IN ALBANIA? “Things do look positive, since Albania is an emerging country with a lot of potential in virtually all market sectors.”

Panagiotis Drakopoulos is the senior partner of Drakopoulos Law Firm, he comments on the current climate in Greece.

“Deals have been scarce in Greece over the last period, as a result of the on going financial crisis in the country. During the last quarter we have been mainly advised on privatizations and intra group mergers of multinational clients. Deals typically take 2 months to 12 months to complete, depending on the complexity of the transaction. Funds coming from bank financing have been rare in the past couple of years, which has lead to fewer deals, with larger private equity participation. The Greek crisis has rendered transaction activity virtually inexistent; hopes have been placed to the new EU financial rescue package for reviving the economy and resulting in new deals.”

WHICH SECTORS PERFORMED BEST OVERALL IN YOUR JURISDICTION OVER THE COURSE OF 2011 AND HOW DOES THIS COMPARE SO FAR TO Q1 2012? WHAT ARE THE PREDICTED HOTSPOTS FOR 2012?

“Green energy and tourism outperformed all other sectors, being also the predicted hotspots for 2012.”

HOW POSITIVE IS THE OVERALL ATTITUDE REGARDING GROWTH AND DEAL OPPORTUNITIES IN YOUR REGION? “The outlook is certainly not on the positive side for Greece, both in terms of growth and deal opportunities. The country should first focus on implementing major structural reforms, which in turn may lead to growth and new deals.”

Adrian Roseti is a partner at the Tirana office of Drakopoulos Law Firm. He commented on the

ACQUISITION INTERNATIONAL

current climate in Romania: “We have advised on several multi-facetted deals involving cross border transactions and efficient company structure solutions, in the areas of Real Estate, Finance, FMCGs and Energy.

It is very clear that the duration for each deal depends on, inter alia, the object, the financing solutions and “clean” assets. Therefore, deals can take between 2 and 12 months to complete, bearing in mind that careful due diligence and removal of ‘bad apples’ is often - times required. Financing is mainly provided by the banks.

HOW DOES YOUR FIRM ADD REAL VALUE TO THE DEAL? AND WHAT ARE THE FIRM’S GOALS FOR THE REST OF THE YEAR? “On top of swift implementation, we believe that our added value also consists of innovative structuring solutions and a very good knowledge of the relevant market, not only from a legal, but also from a business point of view. Our goals for this year are to continue our involvement in pending projects and to enhance our taxation department for providing clients with turn - key solutions from every aspect.

WHAT PATTERNS AND LEVELS OF TRANSACTION ACTIVITY HAVE YOU WITNESSED IN YOUR JURISDICTION THIS QUARTER? HOW HAS Q1 2012 COMPARED TO Q1 2011?

Transactions seem to have increased, both in terms of volume and size; we have noticed that this year’s first quarter is populated by merger intentions of old competitors that are trying to secure broader market shares.

WHICH SECTORS PERFORMED BEST OVERALL ROMANIA OVER THE COURSE OF 2011 AND HOW DOES THIS COMPARE SO FAR TO Q1 2012? WHAT ARE THE PREDICTED HOTSPOTS FOR 2012?

Name: Glib Bondar Email: gbondar@avellum.com Telephone: +380 44 220-0335

Name: Kostiantyn Likarchuk Email: klikarchuk@avellum.com Telephone: +380 44 220-0335

Company: Avellum Partners Web: www.avellum.com Address: 19-21 B. Khmelnytskoho Str., 01030, Kyiv, Ukraine

Name: Adrian Mellor Email: adrian.mellor @allenovery.com Telephone: +33 1 40 06 54 00 Name: Jean-Christophe David Email: jean-christophe.david @allenovery.com Telephone: +33 1 40 06 54 00

Company: Allen & Overy Web: www.allenovery.com Address: 52 avenue Hoche, CS 90005, 75379 Paris Cedex 08 France

“Energy and Real Estate seem to have been the drivers in 2011; a similar trend should be the case also for 2012.”

De Gaulle Fleurance & Associés M&A practice’s main strengths and competitive advantages stem from their project mode approach to handling their clients’ files.

The teams are organized and operate with a view to not only providing the best service, but also to addressing the overall situation or concern our clients entrust us with. “Our teams are hence structured around a project manager, who enjoys a broad overview of the whole situation and can call in and coordinate the various specialty experts deemed necessary, on a case by case basis, to focus on and deal with specific issues. This methodology allows us to identify the right solutions in total osmosis with our clients and offer no non sense responses to legal concerns because we also see them as business issues, in a comprehensive manner that addresses the business fundamentals and the Continued on next page...

Name: Gjergji Gjika Email: ggjika@ drakopoulos-law.com Telephone: +355 42 400900 Name: Panagiotis Drakopoulos Email: pdrakopoulos@ drakopoulos-law.com Telephone: +30 210 6836 561

Name: Adrian Roseti Email: aroseti@ drakopoulos-law.com Telephone: +40 21 3000154

Company: Drakopoulos Law Firm Web: www.drakopoulos-law.com

April 2012 /

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SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review culture of the company as well. Our firm goes beyond being a good law firm to being a good counselor, an actual business partner. To achieve that, all members of our firm are graduates from French and foreign law universities and business schools. They all have transverse expertise through one or more specialties, working on transactional matters as well as on litigation, including internationally. This philosophy has contributed to the success of our firm since its inception. At about the same time that our firm celebrated its 10th year anniversary, it won the golden trophy for “2011 Best Firm of the Year” given out by the “Trophées du Droit et de la Finance 2011” during the ceremony held last November. The jury that awarded us this trophy was composed of major corporations’ general counsels.”

Luís Morais is a Senior Lawyer of the Law Firm FBL Advogados., he comments: “The Firm provided all legal services to the acquisition of an Angolan financial institution, with up to eight subsidiaries, with total assets worth USD 7 billion and net value of USD 600 million.

The services provided were: i) the provision of legal assistance in each of the steps of the acquisition, including the rendering of legal opinions requested by the client; ii) the review of all legal structure to be adopted for the acquisition; iii) the review of all tax aspects involved in the acquisition; iv) the carrying-out of a legal due diligence exercise; v) the drafting and negotiation of all documents required to complete the acquisition; vi) the obtaining of any necessary governmental approvals.

“The Firm has particular expertise in draft and negotiates with National Agency for Private Investment processes, incorporation, mergers and acquisitions, liquidation and dissolution of companies, giving legal advice to companies managers, conducting due diligences on companies, drafting commercial contracts, such as joint ventures and grouping of undertakings, giving legal advice to real estate projects.”

LUIS HOW POSITIVE IS THE OVERALL ATTITUDE REGARDING GROWTH AND DEAL OPPORTUNITIES IN YOUR REGION? “Angola as a codified legal system which guarantees equal treatment of Angolans and foreigners. The Angola Judicial system comprises the Supreme Court and Municipal Courts, which are dispersed throughout Angola’s Provinces. After formal recognition by the Supreme Court, foreign judgments and arbitral awards may be enforced in Angola.

Angolan Arbitration Law subscribes to the United Nations Commission on International Trade Law (UNCITRAL). As a member of the World Intellectual Property Organization (WIPO), Angola is committed to the protection of intellectual property and has adopted the Paris Convention for the Protection of Industrial Property. The Angolan Industrial Property Institute promotes the registration of patents, trademarks, names and badges, industrial designs, utility models, rewards and provenance indications.

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/ April 2012

WHAT ARE THE CURRENT LEVELS OF IMPORT AND EXPORT VOLUMES? ARE THESE UP OR DOWN COMPARED TO THIS TIME LAST YEAR AND WHY? “The Angolan Customs Legislation has recently been updated. In 2006 Angola approved the Customs Code and in 2008 the Customs Tariff and Export Duties. The importation of goods into Angola is generally made without restrictions. Products such explosives, roulette tables, playing cards, weapons and ammunition require prior authorization.

Customs duties range between 2% and 30% of the Cost, Insurance and Freight (CIF) price of imported products, depending on the type of product and whether they are essential, useful, superfluous or luxury.Tax and Customs exemptions may be granted to investors by the Finance Ministry and by the Customs General Directorate, when the imported materials and equipment are used within the framework of private investment projects approved

by ANIP or by the President of Executive. The import, export and re-export of goods into Angola require an import license issued by the Ministry of Commerce (Ministério do Comércio). Transactions in certain goods also require authorisation from specific ministries. Now the current level of importation and exportation is higher than the last years for the development of the country will face general elections in 2012.”

Gbolahan Elias is a partner in the law firm of G.Elias & Co. Some of our experience in M&A includes asset purchases, share purchases and statutory mergers in virtually all sectors of the economy especially financial services, telecommunications, oil and gas and manufacturing.

“We are known for our sensitivity to clients’ business needs, creativity in developing solutions to their problems and promptness in responding to and executing their requests. We were ranked Tier 1 in all categories by the International Financial Law Review (“IFLR”) 2012. We were ranked in the top tier in Banking and Finance in the Chambers Global 2012 rankings. The Legal 500 ranked us Tier 1 in Corporate/Finance. We bring to the table over twenty years’ experience in M&A deals in Lagos. We have advised on some 50 M&A deals over the years with a wide range of deal structures and in virtually all sectors of the economy. Our experience and expertise place us well to execute deals quickly, anticipate likely difficulties and develop effective solutions to the challenges arising in them. In the last quarter, we advised on a merger (between Ecobank Nig. Plc and Oceanic Bank Nig. Plc) that created Nigeria’s 5th largest bank by asset size and branches. The acquirer has been our client for nearly fifteen years.”

HOW LONG ARE DEALS TYPICALLY TAKING TO COMPLETE AND HOW ARE THEY BEING FUNDED? “A deal can take up to 24 months depending on the type of transaction and the commitment of the parties. However, in recent times we have seen deals close in 8 months and others take as little as 3 months.

The deals are getting funded with equity (sometimes

from private equity firms) and debt where funding is required. Sometimes, as in a statutory merger or other share exchange deal, no funding is needed.”

HOW DOES YOUR FIRM ADD REAL VALUE TO THE DEAL? AND WHAT ARE THE FIRM’S GOALS FOR THE REST OF THE YEAR? “If we may say so, we add value by our creativity, attention to detail and speed of execution, both grounded in experience. We hope, in 2012, to grow our M&A deal manhours and revenue by at least 50% relative to 2011.”

WHICH SECTORS PERFORMED BEST OVERALL IN YOUR JURISDICTION OVER THE COURSE OF 2011 AND HOW DOES THIS COMPARE SO FAR TO Q1 2012? WHAT ARE THE PREDICTED HOTSPOTS FOR 2012?

“I would expect 2012 to continue and grow what did well in 2011: oil and gas; telecommunications; financial services and manufacturing. The experience in Q1 2012 supports this expectation.”

Boris Arkhipov is partner at Gide Loyrette Nouel, Moscow, he commented on the key strengths of his team: “Multilingual and efficient team of Russian, English and French qualified lawyers based in Moscow and St Petersburg having substantial track record of M&A deals on the market. Building on more than 15 years of experience in the Russian Federation, Gide Loyrette Nouel (GLN) has developed unique expertise as legal counsel to investors and international institutions in all areas of Russian and international corporate, , especially as it applies to foreign investors. GLN opened its Moscow office in 1993 and its Saint Petersburg office in 2009. It currently has a staff of 55 people including about 40 lawyers and legal consultants. GLN Moscow advised EBRD in a crossborder acquisition of a minority equity stake of around 15 per cent in Russia’s privately-held OJSC Katren, the holding vehicle for pharmaceutical distributors operating in Russia, Ukraine, Kazakhstan and Belarus, as well as a retail pharmacy chain in Russia. GLN Moscow assisted a major international producer and distributor of cryogenic liquids and gases in the recent acquisition of a Russian company that specialises in the production of technical gases.

GLN Moscow is assisting a major international producer and distributor of cryogenic liquids and gases in the potential acquisition a Russian company that specialises in the production of technical gases.

GLN is advising a major Russian agro-industrial company within the framework of establishment of a joint venture with one of the largest financial corporations in CIS. WHAT PATTERNS AND LEVELS OF TRANSACTION ACTIVITY HAVE YOU WITNESSED IN YOUR JURISDICTION THIS QUARTER? HOW HAS Q1 2012 COMPARED TO Q1 2011?

“We noted certain growth on the M&A market in 2012 as compared to 2011. There is an increase in

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review private equity transactions, whereas there are less equity capital market transactions.”

Hannes Jarolim is the founding partner of Jarolim Flitsch Rechtsanwälte GmbH, Irena Gogl recently re-joined the firm as a new partner after spending some time in the UK and working for international law firms.

“We advise national and international companies in all aspects of M&A transactions, offering the full range of legal services required from drafting legal due diligence reports, determining the most efficient structure of an undertaking from tax- and corporate law aspects, handling related administrative procedures, such as merger control and other authoritative consent and/or examination proceedings, to its legal implementation. Irena Gogl additionally focussed on the finance-related aspects of M&A transactions. Together with my team, I advise on structured acquisition debt finance transactions, on national as well as on international level, and assist clients in equity finance undertakings, whether through public offering on the capital markets or other means. Our lawyers each have specialised in a certain field of law, but at the same time have maintained a certain level of generality and, thus, understanding for other fields of law, which we believe is essential, in particular in M&A transactions, which very often require a vast understanding of legal concepts in several fields of law. All our lawyers furthermore have profound knowledge of the industry and markets they have specialised in. In this regard, our firm focusses on 5 core industries: transport and infrastructure, real estate, public sector, health care and finance and insurance.

HOW HAVE YOU BEEN AFFECTED BY THE MAJOR REGIONAL CATASTROPHES (FOR EXAMPLE THE EUROZONE DEBT CRISIS, THE SLOWDOWN IN CHINA AND INDIA ETC.)?

“The financial crisis also affected the Austrian M&A market, significantly reducing M&A activities in the last few years. This year it seems that the domestic M&A activities are picking up. Several Austrian companies are restructuring, some with the intention of getting rid of their secondary businesses and focussing more on their core business. Several Austrian financial institutions, for example, have and will continue in 2012 to sell their businesses and subsidiaries in Eastern Europe, opting for more concentration on domestic activities. Although there are no major mergers to be expected for 2012, the market is moving again and its participants’ attitude is growing more and more positive.”

James J. Calder is the Co-Chair of the Antitrust/ Competition Practice at Katten Muchin Rosenman LLP. The firm covers the full range of antitrust/ competition law matters for US and foreign clients.

M&A competition expertise includes: US and foreign merger notification; substantive competition issues; and negotiation and resolution of competition issues with merger review authorities when necessary to

ACQUISITION INTERNATIONAL

obtain merger clearance. We also represent parties objecting to mergers where those transactions raise competition issues that threaten the client’s access to the market and/or key supplies customers or otherwise impair its ability to compete. “We learn our clients’ business and develop a detailed knowledge of its business model and market environment early in the merger process. This permits us to present the transaction to authorities in a way that accurately shows competitive implications of the deal while reaching a quick resolution that protects the client’s market interests. We were recently a recipient of a 2012 “Client Choice Award” from the International Law Office for Competition Law in the US; recognized as a “New York Super Lawyer” from 2007-2011 for Antitrust Litigation. In 2011, we represented a non-party objector to the Google-ITA acquisition. Currently, we are representing Standard Parking Corporation in its acquisition of Central Parking Corp, two of the largest parking facilities management firms in the US. We are beginning to see an uptick in strategic deals as the economy begins to gain traction. In 2011 transaction activity was suppressed somewhat, in our view, due to the Euro crisis and Japanese earthquake. As confidence in the US recovery continues to grow, and given continued low borrowing costs, we expect deal activity to increase.”

Luther law firm is a leading fully -fledged law and tax firm in Germany with more than 300 professionals operating 11 offices in Germany and 5 offices abroad (London, Brussels, Luxembourg, Singapore, Shanghai).

Luther is rendering legal and tax advice to numerous national and international clients. Dr. Markus Schackmann chairs the M&A team of Luther with more than 40 lawyers who are fully dedicated to M&A transactions. He is focused on advising national and international conglomerates as well as private equity firms in national and international acquisitions and joint ventures. His industry focus is on industrial products, automotive as well as metals and commodities. “The key strength of our team is the industry focus. Each team member has an industry focus so that we are in position to advice our clients on legal and other aspects in relation to the industry he would like to invest in. Chambers as well as Legal 500 are listing Luther as Tier 3 M&A law firm. Dr. Markus Schackmann is listed as highly regarded in Chambers and is explicitly mentioned as legal M&A advisor in Legal 500.”

Name: Henri-Nicolas Fleurance Email: contact@dgfla.com Telephone: +33 (0)1 56 64 00 00

Name: Frédéric Ruppert Email: contact@dgfla.com Telephone: +33 (0)1 56 64 00 00

Company: De Gaulle Fleurance & Associés Web: www.dgfla.com Address: de Gaulle Fleurance & Associés 9 rue Boissy d’Anglas, 75008, Paris, France

Company: FBL Advogados Name: Luís Morais Email: luis.morais@fbladvogados.com Web: www.fbladvogados.com Address: Rua dos Enganos, 1, 8th floor Telephone: +244 937 377 807

Company: G. Elias & Co. Name: Gbolahan Elias Email: gbolahan.elias@gelias.com Web: www.gelias.com Address: 6 Broad Street, Lagos, Nigeria Telephone: (2341) 2806970

HAVE THERE BEEN ANY NOTABLE DEALS (SIZE, COMPLEXITY, DURATION, ETC.) THAT YOU’VE BEEN INVOLVED IN OVER THE LAST QUARTER? “Dr. Markus Schackman advised ArcelorMittal on numerous transactions. At the end of 2011 we closed the acquisition of the last privately held coke plant. Further we advised on the disposal of a chain of hospitals to a subsidiary of the public listed Fresenius SE. Furthermore, we advise Merrill Lynch on M&A transactions. In addition to that Dr. Markus Schackmann is the exclusive M&A lawyer for the Continued on next page...

Company: Gide Loyrette Nouel Name: Boris Arkhipov Email: arkhipov@gide.com Web: www.gide.com Address: 7 ul. Petrovka, Moscow 107031 Russia Telephone: +7 (495) 258 31 00

April 2012 /

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SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review Swiss public listed Schmolz+Bickenbach Group. Over the years we have built up a very strong relationship with our clients who are based on the quality of our performance as well as the personal involvement.

Our policy is to keep a low leverage which should not exceed 1:2 (partner/associate) so that our clients benefit from the strong partner involvement which is far above the market level.”

HOW LONG ARE DEALS TYPICALLY TAKING TO COMPLETE AND HOW ARE THEY BEING FUNDED? “According to our current M&A survey which will probably be launched in March 2012 the average duration of a transaction is about 5.3 months. In 2011 around 70 % of the transactions were financed by equity; the remainder was financed by acquisition finance. It is noteworthy that in the field of acquisition finance we see a shift from syndicated loans to club deals.”

GÜR LAW FIRM is an international law firm consisting of five main departments namely corporate, litigation, banking and finance, maritime, intellectual property, and debt recovery, and they also form up different departments, assemble lawyers and consultants with different expertise depending on the current and prospect needs of their clients.

Tevfik Gür is founding an managing partner at the

firm, he comments on which sectors performed best overall in your Turkey over the course of 2011 and how it compared to Q1 2012: “In our opinion, energy sector was the shining star of 2011. There had been massive amounts of investments made in the said sector. Other than energy, we must say that finance sector and food industry played an active role last year. In addition to the foregoing, textile, shipping and transportation, construction, real estate, automotive, tourism and communication sectors were the hotshots of 2011. As for 2012, we assume that this year will be the year of opportunity for the investors. Due to the recent tendency in the Turkey with respect to the franchise sector, a lot of investments had been made via franchise system and we predict that there will be more. Moreover, Doğuş Holding is leading investors in Turkey which owns T. Garanti Bankası A.Ş., one of the leading banks of Turkey, planning to make its investments in construction, foods and entertainment sector.

Studies also indicate that informatics and finance sector will also shine in Turkey. We also assume that there will be an interesting growth in internet and mobile technology sectors.”

HOW POSITIVE IS THE OVERALL ATTITUDE REGARDING GROWTH AND DEAL OPPORTUNITIES IN YOUR REGION?

fair growth and restricts the deal opportunities in a positive way. In our opinion, other than the restrictions of Competition Board, the system in Turkey immensely supports the growth and deal opportunities in Turkey. As for the Marmara Region, the presence of Istanbul makes the region one of the most important regions of the world. Other than Istanbul, Bursa also has a key role in the Turkish industry. There are still lots of investments ongoing in Istanbul which verifies the growth friendly manner of Turkish system.

HOW HAVE YOU BEEN AFFECTED BY THE MAJOR REGIONAL CATASTROPHES (FOR EXAMPLE THE EUROZONE DEBT CRISIS, THE SLOWDOWN IN CHINA AND INDIA ETC.)?

“After Turkey experienced a severe financial crisis in 2001, Ankara adopted financial and fiscal reforms as part of an IMF program. The reforms strengthened the country’s economic fundamentals and ushered in an era of strong growth - averaging more than 6% annually until 2008. Global economic conditions and tighter fiscal policy caused GDP to contract in 2009, but Turkey’s well-regulated financial markets and banking system helped the country through the global financial crisis and GDP rebounded strongly to 8.2% in 2010, as exports returned to normal levels following the recession.”

“As a matter of fact, the Competition Board plays an active role in encouraging a competitive and

Main Office Sümbül Sok. No:61, 34330 Levent/Istanbul-TURKEY Phone :+90-212-325 90 20 / Fax:+90-212-325 90 23 E-mail: info@gurlaw.com Company: GÜR LAW FIRM Name: Tevfik Gür Email: tevfik@gurlaw.com Web: www.gurlaw.com

Languages English, German, French, Russian, Italian, Arabic Contacts Tevfik Gür (Founding & Managing Partner) tevfik@gurlaw.com Serkan Yildirim (Partner, Head of Litigation Department) serkan@gurlaw.com Isenbike Bilgili (Partner, Corporate Department) isenbike@gurlaw.com Caka Kul (Partner, Corporate Department) caka@gurlaw.com

Moscow Office Nizhnyaya Krasnoselskaya Street 40/12 Bld. 20 Nov Business Center 105066 Moscow-Russian Federation Phone/Fax: +7 (499) 346 39 47 Number of Lawyers & Paralegals 50 International Groupings Turkish American Business Association London Maritime Arbitration Association British Chamber of Commerce of Turkey Italian Chamber of Commerce of Turkey German Chamber of Commerce of Turkey

SECTOR SPOTLIGHT:

Acquisition International’s 2012 Q1 Review Immanuel Gerstner, partner at Saxinger, Chalupsky & Partner Rechtsanwälte GmbH commented: “In our perception there has been an increase in M&A activity involving Austrian companies in 2011 compared to last year. M&A transactions in the energy and real estate industries still made up a substantial amount of all transactions in terms of numbers and value with increasing activity in the financial sector. The legal advisory services for a typical M&A transaction include advice on company law, capital markets, tax and labour law as well as cartel and unfair competition law. Compared to other jurisdictions, the legal framework for M&A transactions in Austria is widely regulated by statutory law, thus making it necessary to explicitly exclude the default regulations by contract if so desired by the clients.On 1 August 2011, the Corporate Law Amendment Act 2011 came into force implementing the EU Directive regarding the reporting and documentation requirements in the case of mergers and divisions. This change, in particular, shall lead to a reduction of the administrative burden for companies by reducing the information requirements for corporate restructuring. For instance, companies are now also able to submit the merger or spin-off plan electronically which saves time and money compared to the former requirement of submission to the commercial register and publication in the Official Journal of the “Wiener Zeitung”. The new law provides significant, also financial, relief for restructuring within a group of companies by inter alia eliminating the obligation to pass shareholders’ resolutions, submit merger or spin-off reports by the management and the supervisory board under certain conditions.

SCWP Schindhelm distinguishes itself from other law firms through its hands on mentality and an international network of cooperating offices which enables us to easily operate any international business and process any legal inquiries that may arise while all legal work done can be coordinated by one of our offices. As alluded to above, M&A activity in Austria is constantly increasing whereas as a result of the financial crises and the global downturn, transactions have become more demanding in terms of due diligence, structuring and financing.”

The “Yukov, Khrenov and Partners” Law Office specializes in representation of Clients’ interests in arbitral courts of the Russian Federation and legal consulting services, actively performing support of M&A transactions: working out the mergers and acquisition strategies, their legal support, setting up the legal base for purchase and sale of shares for the transactions of merger, acquisition or division of companies, consulting in the field of tax and antimonopoly legislation, setting up of the transactions, dealing with offshore jurisdictions, with banking law, restructuring and financial rehabilitation of business.

Pravo.Ru ranked the firm among the top 10 law firms in Russia in 2011. Besides the firm can be found among the recommended law firms in leading international and Russian ratings of Corporate/M&A

ACQUISITION INTERNATIONAL

practice among which Chambers & Partners, LEGAL 500, PLC Which Lawyer. We act in accordance with the best standards of legal services that lie in the basis of the best cases of national and international advocacy, developing the strategies of transfer or defense of corporate control, bringing these strategies into practice via combined due diligence and risk management procedures, transactions structuring and court representation.

WHICH SECTORS ARE EXPECTED TO PERFORM BEST OVERALL IN YOUR JURISDICTION OVER IN 2012? WHAT ARE THE PREDICTED HOTSPOTS FOR 2012?

“We expect demand for legal support in acquisition processes involving the squeeze-out of minority shareholders, development of partners’ agreements including shareholders’ agreements on Russian law within the frame of the business structuring. Besides, according to the terms of Russia’s admittance to WTO, we expect hotspots in banking and insurance sectors as far as Russia agreed to allow foreign ownership of banks, broker dealers, and investment companies upon accession and to allow foreign insurance companies to operate through subsidiaries.”

HOW POSITIVE IS THE OVERALL ATTITUDE REGARDING GROWTH AND DEAL OPPORTUNITIES IN YOUR REGION? Because of the acceptance to WTO Russia will gain greater access to overseas markets and will have to grant other WTO members greatly improved access to its own market resulting in growth of deal opportunities and the lack of lawyers and politicians trained to defend the interests of Russia on the global market and Russia’s legislation and judicial system lacking special instruments to make the performance of Russian legal entities and Russian producers safe and protected from global enterprises and global monopolies.

Company: Katten Muchin Rosenman LLP Name: James J. Calder Email: james.calder@kattenlaw.com Web: www.kattenlaw.com Address: 575 Madison Avenue / New York, NY Telephone: (212) 940-6460

Company: Luther Rechtsanwaltsgesellschaft Name: Dr. Markus Schackmann Email: markus.schackmann @luther-lawfirm.com Web: www.luther-lawfirm.com Address: Graf-Adolf-Platz 15, 40213 Duesseldorf Telephone: +49 211 5660 18792

Company: Saxinger Chalupsky & Partner Rechtsanwälte GmbH Name: Immanuel S. Gerstner Email: vienna@scwp.com Web: www.scwp.com Address: A-1060 Vienna, Linke Wienzeile 4/II/2 Telephone: + 43 1 9050100

Name: Alexander Khrenov Email: info@yklaw.ru Telephone: +7 (495) 927-07-07

Name: Hannes Jarolim Email: office@jarolim.at Telephone: +4312537000

Name: Diana Solopchenko Email: info@yklaw.ru Telephone: +7 (495) 927-07-07

Name: Irena Gogl Email: office@jarolim.at Telephone: +4312537000

Company: Yukov, Khrenov & Partners” Law Office Web: www.yklaw.ru Address: Bolshoy Vatin Lane, 3, Moscow, Russia, 109240

Company: Jarolim Flitsch Rechtsanwälte GmbH Web: www.jarolim.at Address: Volksgartenstraße 3/1, 1010 Vienna

April 2012 /

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SECTOR SPOTLIGHT:

Doing Business in Finland

DOING BUSINESS — in Finland

Economic growth for Finland increased by 2.9% over the course of 2011, which was better than expected considering the problems in the Eurozone.

Finland has always had a strong export-lead economy but this has been weakened by subdued demand for Finnish goods as a result of the crisis in Europe. Goods exported last year grew by 2.1% however exports of services declined by 8.6% resulting in an overall decline of 0.8% in exports.

Business confidence has also fallen due to the stagnated economy and investment will likely be delayed until the economic conditions become more favourable. On a positive note, the economy is set to recover towards the end of the year, with growth predicted to be 0.7%.

Despite the suffering exports and the downturn in growth, many areas of the economy had a positive year last year which will hopefully continue through 2012. Wholesale trade sales grew by 7.8%, Retail trade sales increased by 5.2% and the volume of retail trade sales were up 2.3% on the previous year.

The turnover in the daily consumer goods trade increased by 6.4% and in the department store trade by 2.2%.Electronics industry output declined by 3.4 per cent. This would mean that expectations for growth this year are modest, although the worst fears of a recession appear to be receding. Acquisition International speaks to the experts…

Tuomo Kauttu is partner at Kauttu Attorneys, who have an extensive experience in serving the business community regarding various aspects of business laws. The current firm was formed in 2007 and has its origins in law partnership established in 1996.

“We work on commercial transactions and international operations in a diverse collection of industries, including technology, energy, manufacturing and transportation. Our main practice areas are: corporate law; mergers and acquisitions; finance and venture capital; technology and IPR; international taxation. Being a boutique law firm, we aim to assist clients by delivering the quality of professional service expected from large firms, but with greater flexibility, efficiency and responsiveness. Our focus is truly global. The firm has established professional relationships with law firms across Europe, in North America and in Asia.

In the Northern European region, we are able to serve clients through a network of law firms. This gives an advantage also on personal level.

Finland’s strengths lie in natural resources, ICT, forest, energy and mineral expertise, collaborative culture and neutral international stance. Also, Finland’s open society and uncomplicated Nordic cooperation provide possibilities. Over the next 12 months I expect a proposed foreign investment strategy to be implemented to attract foreign investments and capital to Finland. Also,

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implementation of business and investment friendly tax reforms, including an idea of tax exemption for small dividends.”

Golder Associates Oy was founded in 1994 in Finland and is a part of global Golder Associates Corporation.

Providing consulting, design, and construction in our specialist areas of earth, environment and the related areas of energy. We have currently 160 offices and 7000 employees worldwide.

Erkki Paatonen, Principal, Office Manager of Golder Associates Oy. “In Finland our main services relate to environmental compliance, site remediation, property development and redevelopment. We work on broad scale of environmental disciplines. We offer services within disciplines like environmental due diligence, environmental impact assessments, risk analysis, health and safety including industrial hygiene, and geo energy. One clear growth area in Finland is mining services, for which Golder has over 50 years expertise from mining projects around the world.

With the issues of sustainability and environmental compliance in mind, our clients encompass all sectors of industry.”

WHAT IS FINLAND CURRENTLY DOING TO IMPROVE ITS BUSINESS ENVIRONMENT IN 2012?

“In the environmental services business field, Finland is well geared for the future: several new laws (e.g. mining law from 2011 and new waste law in May 2012 with other regulations) enforce more strongly environmental aspects, meaning that for industries like mining there are clear paths to develop and grow their business. The new waste law forces companies to study better resource use, i.e. resource efficiency.

There are also national benchmark programs for companies to develop their energy efficiency.”

WHAT RISKS DOES FINLAND FACE IN 2012?

WHAT METHODS HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? “Finland has a quite effective method of promoting and financing new business development, e.g. funding start-up companies (e.g. through partially governmental bodies like TEKES – the Finnish Funding Agency for Technology ad Innovation or Finnfund). These work also during the economical downturn helping companies to invest in developing technologies. There are other organizations as well supporting new developments in the market place.”

WHAT FACTORS HAVE CONTRIBUTED TO FINLAND’S ECONOMY GROWING BY 2.9% OVER THE COURSE OF 2011?

“From our perspective there are clearly few sources of growth contributing to overall Finland’s economic growth, firstly the better use of invested assets and repurposing former industrial areas into cultural and housing use, growth in mining activities in general, and growth in number of companies investing into sustainability strategies and management systems.

Latter leads to the better competitive capability in general for the companies in their respective business area.”

Company: Kauttu Attorneys Name: Tuomo Kauttu Email: tuomo@kauttu.fi Web: www.kauttu.fi Address: Aleksanterinkatu 17, P.O.Box 800, FI00101 Helsinki, Finland Telephone: +358 10 229 1244

HOW HAS THE EURO DEBT CRISIS AFFECTED THE FINLAND’S STRONG EXPORT LEAD ECONOMY? “Downturn has been expected, but we have not encountered it in substantial volume. Instead it seems that clients are, if not pursuing heavy investment projects, they seem to be pursuing other, long term activities in relation to longer term business continuity. Thus, in our field when clients are seeking to grow sustainably, we have managed to keep relatively well also our business performance on planned levels. Our clients have been preparing themselves for the future business also in their foreign sites and activities.”

Company: Golder Associates Oy Name: Erkki Paatonen Email: erkki_paatonen@golder.fi Web: www.golder.com Address: Ruosilankuja 3 E, FIN-00390 Helsinki Telephone: + 358 40 551 8566

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Doing Business in Finland & Denmark

CASE STUDY: MR. KALEVI TERVANEN Founded in 1918, Procopé & Hornborg is one of Finland’s oldest law firms with a strong history and a reputation for quality and excellence. We work with some of Finland’s leading companies as well as major international corporations, assisting them on all aspects of their legal needs.

Over the years we have kept pace with the needs of the international legal market, not by simply networking, but also by hiring foreign-qualified lawyers from several jurisdictions. We can confidently say that we are not only national but also international, as are our clients. Procopé & Hornborg is the only Finnish law firm actively involved in Africa and Middle East. As a top ten Finnish law firm, our size is our strength: big

enough to handle all sizes and styles of assignments but in a personal, flexible and entrepreneurial way.

Our aim is simple: to deliver the most valuable legal advice to our clients through quality and individuallytailored services when and how our clients it demand.

Our practice groups advice clients in four main practice areas: Transactions and Financing, Insurance and Reinsurance, Corporate and Commercial, Dispute Resolution and Litigation, Restructuring and Insolvency. Our lawyers have specific legal expertise in areas including banking and finance, insurance and reinsurance, M&A, competition and EU, energy, IPR, technology, real estate and construction, environmental and labour law.

Company: PROCOPÉ & HORNBORG LTD Name: Kalevi Tervanen Email: law.firm@procope.fi Web: www.procope.fi Address: P.O. Box 1077, Keskuskatu 8 FI-00101 Helsinki, FINLAND Telephone: +358 10 3090 300

DOING BUSINESS — in Denmark

Denmark has a stable business and political environment which has made it a favourable destination for investment. The country is highly dependent on foreign trade and international cooperation and amazingly, despite the global crisis and European debt problems, Denmark avoided a recession in 2011.

WHAT IS DENMARK CURRENTLY DOING TO IMPROVE ITS BUSINESS ENVIRONMENT IN 2012?

AND WHAT METHODS HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? “A tight fiscal policy. And modesty in collective agreements and wage restraint.”

HOW HAS THE EURO DEBT CRISIS AFFECTED THE DENMARK ECONOMY AND ITS RATE OF GROWTH?

Rights and duties are closely connected. No bees, no honey, no work, no money.

Randers / Denmark

A period of subdued growth has been predicted until external conditions improve and this weakened outlook for 2012 will slow investment until business confidence is restored approaching 2013.

This subdued outlook for growth is partly due to lack of competitiveness of the export-oriented industrial sector, which is forecast to improve at a moderate pace throughout 2012. As a result, exports are not expected to be a key driver in the recovery seen for 2013. Acquisition International speaks to Per Hansen, a lawyer and administrative director at hansen|sønderby.

ACQUISITION INTERNATIONAL

hansen|sønderby serves enterprises and institutions within the core areas of commercial law, including property law.

WHAT FACTORS CONTRIBUTED TO DENMARK AVOIDING A RECESSION IN 2011? AND WHY HAS A SLOWDOWN BEEN PREDICTED IN 2012?

“A tight fiscal policy. A slowdown in zoll was also predicted in March 2011. Danish companies are steadily working in order to increase our export.

According to consumer confidence, we still have some problems.”

Company: hansen|sønderby Name: Per Hansen Email: pt@hsco-law.dk Web: www.hsco-law.dk Address: Tronholmen 3, 3., 8960 Randers SØ, Denmark Telephone: 70300500

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SECTOR SPOTLIGHT:

Doing Business in Iceland

DOING BUSINESS — in Iceland

Iceland has returned to growth in 2011 with GDP reaching 3.1% and it is expected to continue growing until 2016.

Iceland was the hardest hit by the global economic crisis in 2008 when its banking system collapsed and the region is still suffering as a result.

Reykjavík / Iceland

Iceland has since completed a 33-month International Monetary Fund program and is expecting growth of 2.5% this year. In 2011 domestic expenditure increased by 4.7%. Household final consumption increased by 4% and gross fixed capital formation by 13.4% while government final consumption decreased by 0.6%. At the same time, exports grew by 3.2% and imports by 6.4% resulting in a surplus in the balance on goods and services.

Iceland is on the road to recovery although it will be some time before the full effect of the 2008 crisis will be overcome. The European turmoil has created some uncertainty however Iceland has been relatively well protected from the risks and benefits from not sharing the single currency.

In recent years, Iceland has made its business environment increasingly attractive to foreign investors, making more investment opportunities available for organisations and businesses.

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Due to this the country has started to see a rising interest from foreign businesses wanting to invest in the country. The country’s investor-friendly environment supports high professional standards In conjunction with some of the country’s leading professionals we’ll be examining the quality of the business environment in Iceland and the risks it faces in 2012. We will look at the recovery of the economy after the global economic crisis in 2008 and the pace at which it is recovering. We will look at how the economy is still suffering the effects and discuss how much growth is necessary to restore the economy.

Páll Eiríksson is Partner at Borgarlogmenn – Holm & Partners, Icelandic law firm.

The Law Firm of Holm & Partners was founded in 2006, which traces its roots back to 1995 when Steinunn Holm Gudbjartsdottir started her own private practice.

Steinunn Holm Gudbjartsdottir is an Icelandic citizen. She attended the University of Iceland and studied law.

She graduated in 1988. She worked in the office of the Reykjavík County Commissioner from 1988 to 1992 as a lawyer. She was admitted as an Attorney to the District Court in 1992 and entered private practice. In 2005, she became an Attorney to the

Supreme Court and since 2007 has been a ViceJudge in the Labour Court. She lectures in law at the University of Reykjavík, predominantly in her specialist fields of bankruptcy law, litigation and inheritance law. She is a member of a number of Icelandic governmental committees Páll Eiriksson is an Icelandic citizen. He attended the University of Iceland and studied law. He graduated in 1999.

He attended the University of Exeter in the United Kingdom, studying international business law, and graduated with a master’s degree in that field in 2002.

He was admitted as an Attorney to the District Court in 2000. He worked with Deloitte as a corporate and tax lawyer from 1999-2006. From 2006-2009 he worked at Glitnir as a lawyer. In October 2008 he was appointed the General Counsel for the Resolution Committee which took over control of Glitnir in that month and was subsequently appointed to Glitnir’s Winding-up Board as described above.

The partners and associates comprise an experience in different fields of the law, enabling the firm to offer the client a full range of services.

WHAT RISKS DOES ICELAND FACE IN 2012?

WHAT METHODS HAVE BEEN PUT IN PLACE TO PROTECT THE ECONOMY? FOR EXAMPLE KEEPING ITS OWN CURRENCY.

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Doing Business in Iceland In order to prevent a potential shortage of foreign currency, the Central Bank of Iceland implemented temporary restrictions on foreign exchange transactions with the Icelandic krona (ISK).

These restrictions caused some initial frictions and problems with payments and settlements of international transfers between Iceland and other countries. However, there are no restrictions on currency transactions relating to the import and export of goods and services.

The Central Bank of Iceland has introduced a plan to remove capital restrictions in two phases. In phase 1 the plan is to reduce offshore ISK positions and in phase 2 to remove onshore ISK controls. It is forecasted by the Central Bank to complete the plan by the end of year 2015.

Iceland has applied for membership of the EU and the formal negotiations started in June 2011. Despite the recession, Iceland´s future should be bright based on highly educated workforce, plenty of natural resources and innovative and competitive businesses .

Gunnar Sturluson is a Managing Partner at Logos Legal Services. Sturluson is a Supreme Court Attorney since 1999 and specializes mainly in corporate law, mergers and acquisitions, contract law and competition law.

The history of LOGOS begins in 1907 when Mr. Sveinn Bjornsson, who later became the first president of Iceland, established the Counsel Office.

The Counsel Office was also the first law firm ever opened in Iceland.

In the year 2000 The Counsel Office merged with Adalsteinsson and Partners and as a result of the merger LOGOS became the largest law firm in Iceland with a powerful team of lawyers and assistants who specialize in services for the business community using their broad range of experience on behalf of our clients in all aspects of business law practice.

To maintain our advantage we have systematically recruited the finest crop of professionals available.

Our office’s both in London and Copenhagen provide us an advantage locally as Logos is the only Icelandic law firm with presence outside of Iceland. As the economy has changed drastically for Iceland over the past four years Logos has endeavored to adjust its operation to meet the tasks ahead. The economic growth in 2011 is a sign of economic recovery after two years recession measured 4% in 2010 and 6.8% in 2009. The economic growth of 2011 therefore has to be seen in perspective as it’s a bounce back from recession. The main contributor to the economic growth of 2011 is growth in the tourism industry and growth in fishing industry exports. Other factors

ACQUISITION INTERNATIONAL

such as domestic consumption and investments contributed as well. This is set to continue in 2012 despite projected downturn in Europe as the exchange rate of the Icelandic króna remains low which stimulates export industries and tourism.

Iceland has successfully finished a program it went into in collaboration with the International Monetary Fund (the IMF) after the collapse of Iceland’s three largest financial institutions in fall of 2008 and that contributes to investor’s faith in the Icelandic economy.

Europe is by far the most important market for Iceland as almost 90% of all exports from Iceland are to Europe and there of around 50% to the Euro zone.

The main risks in 2012 are considered to be the unstable exchange rate of the Icelandic krona and political instability. The Central Bank of Iceland has controlled the currency in order to stabilize the exchange rate.

That control consists of restrictions on the trade of all foreign currencies to protect the Icelandic krona.

There have been talks of unilateral adoption of a foreign currency. Some promote the Euro, others the Scandinavian currencies and then there are those that are promoting the adoption of the Canadian Dollar.

If there is a change of policy regarding foreign investments, investments in industry and the currency restrictions are lifted, Iceland has every opportunity to be on its way to a recovery in 2013.

Moreover, Iceland will need foreign credit capital in order to recover from the crisis and the possibilities of foreign loans depend upon the situation in Europe.

The economic growth of Iceland is therefore partly dependent upon the Euro crisis being resolved.

LOCAL Partners was founded in 2011. LOCAL Partners comprises of three main areas of practice; LOCAL attorneys, LOCAL finance and LOCAL auditing.

The company provides individuals and companies with a wide range of integrated professional services of attorneys and state authorized public accountants.

LOCAL attorneys provide legal services in the fields of corporate, commercial and tax law and other legal services. LOCAL finance provides services in the fields of finance, accounting, taxation and bookkeeping. LOCAL auditing specializes in the fields of auditing and other assurance services.

Guðrún Bergsteinsdóttir is Attorney at LOCAL Partners.

The Euro dept crisis has affected Iceland as well as other countries. The economic outlook in Europe is uncertain which has resulted in slower economic recovery in Iceland. Access to credit markets is limited which will complicate investment. However since Iceland has in place currency restrictions then it is in many ways cut off from the outside world, and thus is not as affected by the Euro dept crisis as others.

Iceland is currently trying to attract foreign investors in order to obtain foreign capital. That way the currency restrictions may more easily be abolished which is the key for increased export.

Company: Borgarlogmenn Name: Páll Eiríksson Email: pall@borgarlogmenn.is Web: www.borgarlogmenn.is Address: Lágmúla 7, 2. hæð 108 Reykjavík Telephone: 533 1330

Company: LOCAL attorneys Name: Guðrún Bergsteinsdóttir Email: gudrun@lp.is Web: www.lp.is Address: Tungata 14, 101 Reykjavik, Iceland Telephone: + 354 527 9700

Company: Logos Legal Services Name: Gunnar Sturluson hrl.

Email: gunnar@logos.is Web: www.logos.is Address: Efstaleiti 5, 103 Reykjavík, Iceland Telephone: + 354 5400 300

April 2012 /

41

SECTOR SPOTLIGHT:

Getting Started in Franchising

GETTING STARTED — in Franchising Often businesses and individuals choose to set up a franchise as this type of business offers a high level of support and can often be easier to arrange financing for. One key advantage of buying a franchise is that you will benefit from using an existing brand and business model and typically support in the form of advertising, training, business advice, and supply chain.

Although franchises are far less likely to fail than other types of businesses, buying a franchise is not necessarily an easy route. As with any business, it still requires a great deal of hard work to turn it into a thriving success. It is of the upmost importance that the prospective franchisees seek professional advice from the offset to ensure that they are registered with the right authorities and that agreements highlight the obligations of both parties. Acquisition International speaks to the experts…

Adams & Adams has a team of attorneys that specialise in various aspects of franchising law. Eugene Honey and Danie Strachan are partners at the firm, they comment: “The members of our team are members of various associations, including the South African Institute of Intellectual Property Law, the Licensing Executives Society and the International Trade Mark Association (INTA). Adams & Adams is also a member of the Franchise Association of South Africa (FASA) and Eugene Honey is a member of its executive committee. Eugene has also received FASA’s Hall of Fame award.

“We act for franchisors mostly, assisting them with the drafting of their franchise agreements and the compilation of disclosure documents. We also advise regarding compliance with legislation, particularly the Consumer Protection Act. The franchise team at Adams & Adams has assisted many new franchises to get their franchise system in place from a legal perspective. In addition, the firm also advises existing and larger franchises on an on-going basis. Intellectual property is the cornerstone of any franchise. However, there are also various commercial aspects involved in a franchise. Adams & Adams, being a leading intellectual property law firm, offers a blend of services that cover both intellectual property and commercial legal services.

We assist clients to understand the franchising model and the challenges involved. We also simplify the complexities that are often involved in the applicable legislation. A large part of our involvement is focused on ensuring that the client gets the three pillars of franchising in place – the franchise agreement, the disclosure document and the operations manual. The franchisee is afforded the opportunity to leverage off existing goodwill and know how that has already been built up by the franchisor. If a franchise has a good reputation and a strong brand, it will automatically attract customers and business for the franchisee. All reputable franchisors also provide efficient support and assistance to their franchisees.

There is no guarantee that any business will remain successful, particularly in the current economic climate.

However, if someone can join a reputable franchise which incorporates a strong and popular brand, proven systems and good franchisee support, their chances of success will be greatly improved. Still, it depends on the effort put in by the franchisee. We normally meet with clients first to

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understand their business and the system which will be the basis of the franchise. We discuss the key elements of the agreement and then prepare a first draft for their input. We then develop and finalise the document, based on the client’s comments. Franchise agreements are complex because one needs to address the underlying intellectual property licence properly, while at the same time comprehensively regulating the business aspects of the relationship.

The Consumer Protection Act, 2008 entered into force last year. For the first time, our country has legislation that specifically regulates franchising. Franchise agreements must comply with this legislation, which prescribes the disclosure of specific information and regulates various aspects of franchising, such as a cooling-off period after signature of the agreement.

Bilal Shaukat is a partner at RIAA LAW. RIAA LAW is a premier law firm of Pakistan with nine partners and twenty five associates and has offices in Karachi, Islamabad, Lahore, Peshawar and Kabul with representatives in UK and China. The Firm is affiliated with Afridi & Angell, having offices in Dubai, Sharjah, and Abu Dhabi in the United Arab Emirates, New York and Beijing.

owner from the hard work and high cost of building a client base from scratch. The franchisee also benefits from an established business system which includes know- how regarding marketing and day to day operations. Despite the lack of control often associated with owning a franchise, a potential franchisee has ample opportunity to choose from a growing number of different franchising business models which allows the freedom to choose a franchising option which complements his or her management style and ethos.

“Studies from other countries have shown that franchises are less likely to fail than other types of businesses. Although similar studies have not been conducted in Pakistan (most likely because franchising is still relatively new), it is probable that the same would hold true for Pakistan.

Anecdotal accounts suggest that both domestic and international franchises are flourishing in Pakistan. The success of the franchise model in Pakistan can be attributed to brand recognition of products and services and support from the franchisors which allow the franchisees to provide a service or product which is uniform to those available abroad.”

“Our Firm is the Pakistan representative of Lex Mundi, the world’s leading association of independent law firms.

Through its association with foreign law firms and Lex Mundi, the Firm has immediate access to more than 21,000 lawyers in 160 member firms, with more than 600 offices in 100+ countries.

According to IFLA website, RIAA LAW is the only Pakistan based member of the International Franchise Lawyers Association (“IFLA”). IFLA is an international organization of lawyers specializing in franchising, distribution and licensing laws.

WHAT ARE THE KEY BENEFITS OF BUYING A FRANCHISE? PLEASE PAY REFERENCE TO BRANDING, BUSINESS MODELS AND SUPPORT ETC. WHY ARE FRANCHISES FAR LESS LIKELY TO FAIL THAN OTHER TYPES OF BUSINESSES? “Previously, within Pakistan, there was a lack of awareness regarding the franchise model. This has changed over the last five years, with a sharp increase in the use of the franchise model across many sectors, most evident in the food, clothing and personal care sectors. This is apparent with the success of various domestic and international brands such as Subway, Arizona Grill, Cinnabon, Crabtree & Evelynn, Debenhams, Hardees, McDonalds and The Body Shop.

“Franchise is a great vehicle from which to access Pakistan’s developing economy and growing middle class.

The most obvious benefit of owning a franchise is the brand recognition. Brand recognition relieves a potential business

Company: Adams & Adams Name: Eugene Honey and Danie Strachan Email: franchising@adamsadams.com Web: www.adamsadams.com Address: 4 Daventry Street, Lynnwood Bridge, Lynnwood Manor, Pretoria, South Africa Telephone: +27 12 432 6000

Company: RIAA LAW Name: Bilal Shaukat Email: bshaukat@riaalaw.com Web: www.riaalaw.com Address: D-67/1, Block 4 Clifton Karachi-75600 Pakistan Telephone: +92 21 35865198

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Getting Started in Franchising

Mr. Dan-Michael Sagell who is a a lawyer and the sole owner of the Swedish law firm Sagell & Co. Advokatbyrå.

my experience on how these agreements fare when tested in reality.

Relating to franchise law, I am a member of the Swedish Franchise Association and of the International Franchise Lawyers Association (IFLA).

The complexity is due to the facts that there is no written law that spells out what a franchise agreement must contain. A franchise agreement is governed by the general principle of freedom of contract. A franchise agreement regulates the rights and obligations of the franchisor and of the franchisee.

Consequently, any right or obligation that cannot be found in the agreement does not exist between the parties in question.

Dan is specialized in franchise contracts and other contracts that are usually connected with a franchise contract such as lease agreements being either for the premises or the equipment’s, additionally , in merger & acquisition regarding franchised businesses, and finally, in arbitration and dispute solutions involving franchisors and franchisees.

A typical client can be a business, Swedish or foreign, that wants to establish a franchise network, and it can also be a business (a company or an individual person) that is planning to sign a master franchise agreement or a franchise agreement. It could also be a franchisor that wants to end a franchise contract prematurely with a franchisee, or a franchisee that wish to file a lawsuit against the franchisor due to breach of contract.

“Our firm is a boutique firm with special knowledge about franchise. Most business law firms in Sweden do not have that know-how in-house.

I assist a franchisee by vetting the franchise agreement and the information about the franchise system presented by the franchisor. Since most of the provisions in such agreement are not negotiable my role is therefore mostly to explain and highlights those provisions that have or could have an impact on the franchisee`s finances.

There are a lot of benefits of buying a franchise over starting up your own business under your own brand. Some of these benefits are as follows.

You are operating under a brand that is already well-known by customers, suppliers and landlords, you are operating under a business model that have already been tested and approved by the market, you can seek advice and support on an on-going basis from the franchisor and also from the other franchisees in the franchise network, you are not alone, and the prices for the supplies and for the marketing should be lower for a franchisee buying as a group instead of buying these items on your own under your own unknown brand.”

SO WHY ARE FRANCHISES FAR LESS LIKELY TO FAIL THAN OTHER TYPES OF BUSINESSES? “The reason for that is that a franchisee is working under a business model that should have been tested and approved by the market, and if that is not enough, a franchisor usually do its outmost to support and save an ailing franchisee unit by agreeing for instance on reducing unpaid franchisee fees or on payment plans, or by buying the franchisee business from the franchisee before the franchisor decides to close down the franchisee unit in question.”

WHAT ASSISTANCE CAN YOU OFFER CLIENTS REGARDING THE DRAWING UP OF FRANCHISE CONTRACTS? WHY DO THESE TEND TO BE SO COMPLEX? A offer my know-how regarding franchise agreements and

ACQUISITION INTERNATIONAL

Ayman Nour is partner at Nour & Taha Law Firm, he comments: “The legislature has introduced limitations of franchise agreements. These limitations of franchisees in order to protect importers and know-how. However, there are ways for overcome such limitations.

on the terms are in favour of technology franchisors to

Background Before the promulgation of the Trade Law (17/1999), local Egyptian franchisees found it difficult to defend themselves before arbitration panels and courts in several jurisdictions. A common difficulty faced by lawyers and arbitrators when defending their Egyptian clients was the partiality of franchise and development agreements in favour of the technology owner (ie, the franchisor).

Therefore, the legislature promulgated a chapter on transfer of technology agreements (ie, franchise agreements), thereby protecting franchisees (usually the local party) through the establishment of a set of public order rules. Parties cannot neglect to comply with these rules; they apply to all national courts and arbitration awards seeking enforcement in Egypt by default.”

Protective boundaries in franchising agreements “The law establishes boundaries that parties to a transfer of technology agreement cannot cross. One limitation set by the law is the nullity of any term that obliges the recipient of technology (ie, the franchisee) to: • Accept modifications to the technology and pay a consideration therefor; • Refrain from modifying the technology better to adapt to and conform to local conditions; • Use specific trademarks to distinguish the commodities for which the technology has been used; • Refrain from obtaining analogous or competing technologies; • Allow the licensor of the technology to run the licensee’s establishment or interfere in choosing its permanent employees; • Purchase raw materials, equipment, machines, apparatus or spare parts for operation of the technology exclusively from the licensor or from specific entities dictated by the licensor; or • Sell the product exclusively to the licensor or

The above provisions, as promulgated, apply as a default rule. Thus, a court would render its judgment in support of the nullity of contractual terms that contradict the above limitations, unless the franchisor establishes the above exception. Any franchise agreement, whether between local or multinational parties, must be governed by Egyptian law.

All disputes arising between the parties must be referred to the Egyptian courts or to arbitration in Egypt.

“Methods of evading boundaries from practical rather than legal standpoints, franchisors can protect themselves against these limitations or minimize risks and exposure by: • Obtaining from franchisees advance letters of credit guaranteeing substantial cash sums if the franchisee breaches any term of the franchise agreement; • Obtaining from franchisees advance initial franchise fees in substantial amounts to be depleted over the duration of the franchise agreement; and acquiring shares in the Egyptian franchisee by virtue of a conditional sale of shares agreement.

“All these methods are effective because they circumvent the option to litigate against the franchisee locally, and thus the franchisor avoids becoming subject to the Trade Law.”

Company: Sagell & Co. Advokatbyrå Name: Dan-Michael Sagell Email: dms@saglaw.se Web: www.saglaw.se Address: Biblioteksgatan 3, P.O. Box 7174, SE103 88 Stockholm Telephone: +4686115542

Name: Ayman Sherif Nour Email: anour@nourtaha.com Telephone: +2 02 33358091

Name: Ehab Ashraf Taha Email: etaha@nourtaha.com Telephone: +2 02 33358091

persons determined thereby.

“Such nullity would not apply if any of the above limitations were provided for in the agreement in order to protect consumers or a real and legitimate interest of the technology provider (ie, the franchisor).

Company: NOUR & TAHA Law Firm Web: www.nourtaha.com Address: 44, Mohyei Eldin Aboul Ezz St. First Floor – Office No. 5 Dokki, 12311 Cairo - Egypt

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SECTOR SPOTLIGHT:

Creating Value out of Due Diligence

CREATING VALUE — out of Due Diligence

Half of all mergers and acquisitions actually end up destroying value, and another two in ten fail to create meaningful value for stakeholders. Due Diligence, or perhaps the lack of it is one of the major reasons why (what is seen to be a well thought out) M&A strategy can fail.

Due diligence on information technology infrastructure prior to a transaction isn’t always high on the list of priorities, according to a survey by Ernst & Young, IT considerations are not given adequate attention or rigour in the due diligence prior to mergers and acquisitions.

When surveying senior corporate and private equity executives, only half the respondents conducted separate pre-deal IT diligence for their last transaction, and only 21% of corporate and 11% PE respondents include technology-related considerations in their transaction negotiations.

IT problems can include unforeseen costs and various issues and complexities; a little bit of research at the start can mitigate unwanted costs and technology woes in the long run. This feature invites a number of leading IT experts to discuss the importance of IT due diligence and demonstrate how to make IT a positive contribution to any merger or acquisition. We aim to show our readers how to make an integration plan that addresses every aspect of the company, from infrastructure, applications, processes and people. We’ll be looking at IT integration from preplanning to post-acquisition and demonstrating how a successful program can both retain and grow value if used effectively. Acquisition International speaks to the experts.

Freshfields Bruckhaus Deringer is a leader among international law firms, providing business law advice of the highest quality throughout Europe, the Middle East, Asia and the US. Mark Parsons is counsel at Freshfields, he comments:

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April 2012

“One of the main areas in which IT due diligence can generate immediate value for our clients is in the context of business separations and carve outs.

An orderly separation will be more costly, difficult and time consuming to achieve if the acquirer has not undertaken adequate legal, financial and technical due diligence into the target’s dependencies on the IT resources of the wider group.

Good IT due diligence will avoid nasty surprises.

This is most obviously true in terms of the need to split or replicate IT and related services that will remain behind, but will also be true in areas such as data migration, which can involve unexpectedly high costs if the data will be migrated to an incompatible platform.

It is also important to understand that IT is not just nuts and bolts. A target’s IT function will be

critically dependent on the knowledge and expertise of the people who build it and keep it running. If the due diligence does not carefully assess the human resources and knowledge capital aspects of the IT function, important value will be lost.

This will particularly be the case where any of this resource sits within a group function which will not be available post-acquisition.

Well prepared transitional service agreements will implement an orderly separation from the wider group, but these agreements are only ever as effective as the due diligence that goes into their preparation.

Finally, it is worth noting that for most businesses IT is a strategic business function. It is important that due diligence be conducted in such a way as to generate the right information for the right people to assess not only the “as is” state of the IT but also how the target’s IT will sit within the acquirer’s broader IT strategy going forward.”

Heymann & Partner is a boutique law firm with a focus on M&A (in particular in the technology sector), Private Equity,/Venture Capital, Corporate Restructuring, IT/IP and Outsourcing. The firm are regularly representing strategic and financial investors on the full range of merger and acquisition transactions, with a special emphasis on technology-driven transactions. Titus Walek and Dr. Moritz Hüsch, LL.M, are both Partners of the law firm Heymann & Partner, Frankfurt am Main, Germany.

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Creating Value out of Due Diligence steps to be undertaken by a buyer to secure his/her rights.

The fulfillment of a due diligence adapted to the value of the company and its business segment, and the association of specialized teams in intellectual property and in information technology law is an assurance of successful acquisition projects.

The experience of NomoS in the sector of intellectual property and information technology allows offering international clients the assurance of a controlled acquisition process, in connection with the corporate and tax practice teams. It is also valuable in assisting the client in the vendor due diligence process to facilitate the negotiations.”

“We are regularly representing strategic and financial investors, both domestic and from abroad, with a special focus on transactions in the high technology sector and cross-border transactions. The crisis did not significantly impact the composition of our clients.”

CAN YOU PLEASE EXPLAIN THE IMPORTANCE OF IT DUE DILIGENCE AND DEMONSTRATE HOW IT CAN MAKE A POSITIVE CONTRIBUTION TO ANY MERGER OR ACQUISITION? The importance of an IT due diligence in an M&A transactions depends on the business of the target company.

If the target company runs a non IT-related business, the purpose of the IT due diligence is to make a legal analysis whether the target has all the IT in place which is required for the operation of its business.

This “standard” IT due diligence is, as a general impression, less complex and time consuming than the IT due diligence with respect to a target operating an IT business. If the target company runs an ITbusiness, the purpose of the IT due diligence (in addition to the “standard” IT due diligence described above) is to make a legal analysis also with respect to the “core” IT of the target company.

By way of example, where the company is a software company, this specific IT due diligence would cover the analysis of the ownership in the software and of all license-, maintenance- and other agreements relating to this software. The results of this specific IT due diligence is key for the further process of the M&A transaction. Where the due diligence reveals that the ownership in the “core” software is not clear or even reveals that the target company does not own the “core” software as a result of missing or insufficient agreements, appropriate measures need to be taken to eliminate these risks (e.g., through execution of appropriate agreements with software developers etc).

ACQUISITION INTERNATIONAL

The conduction of an IT due diligence has a number of positive effects to an M&A transaction (even where the target company does not run an IT-related business): IT related risks can be identified, which can also have a significant financial impact (e.g, where the IT due diligence reveals that the target company has not the required volumes of standard licenses (Microsoft, SAP etc.) in place).

Appropriate measures can be agreed to eliminate or mitigate those risks: “Tailor made” IT warranties, indemnifications and closing conditions can be negotiated to cover the specific risks identified in the IT due diligence in the sale and purchase agreement.

NomoS has a strong client base in the Media and IT sectors where it represents leading companies on a broad range of matters including the day to day advice but also the assistance in key M&A operations.

Eric Lauvaux is partner at the firm, he comments: “For Media and IT companies, intangible assets are the core the company’s market value.

“Often times these assets are not accounted for in balance sheets or when they are, it is for a symbolic value.

Company: Freshfields Name: Mark Parsons Email: mark.parsons@freshfields.com Web: www.freshfields.com Address: Hong Kong office, 11th Floor Two Exchange Square, Hong Kong Telephone: +852 2846 3341

Name: Titus Walek Email: T.Walek@heylaw.de Telephone: +49 (69) 768063-60 Name: Dr. Moritz Hüsch Email: M.Huesch@heylaw.de Telephone: +49 (69) 768063-60

Company: Heymann & Partner Rechtsanwälte Web: www.heylaw.de Address: Taunusanlage 1, 60329 Frankfurt am Main, Germany

“And yet it is the permanence of these rights and the continuity in their exploitation that justifies the value of the company. Relying on the usual warranties and representations of the merger or acquisition agreement may be very risky for the purchaser and is, in any event, clearly insufficient to address the ITrelated legal issues that can directly affect the value of the company.

The assessment of the ownership of rights, their validity and their sustainability requires knowledge of the industries’ practices and wide legal competence, including with regard to the consequences of potential litigation. The involvement of specialized practice teams able to identify risks, assess the probability of their occurrence and quantify them, is necessary to determine the price but also to draft representations and warranties, as well as to identify

Company: NomoS Web: www.nomosparis.com Address: 13, rue Alphonse de Neuville, 75017 Paris (France)

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SECTOR SPOTLIGHT:

Enhancing The Flow of FDI

ENHANCING — The Flow of FDI

With a widening geographic pool of choices and more opportunities in emerging markets, competition to attract foreign direct investment is fiercer than ever.

“This is an interesting time for Hong Kong,” Simon Galpin, Director-General of Invest Hong Kong, the government agency that helps foreign companies to set up in the city, said. “We’re not immune to the global slowdown, but companies here have been quick to adapt and are focusing on new clients and new revenue streams among our neighbouring economies.”

It’s a realistic approach given that some of the regional economies – China, Indonesia, the Philippines, Vietnam and South Korea – are showing relatively robust growth compared with their European and American counterparts. “Understandably business people around the world are looking this way,” Galpin added.

Over the course of 2011, FDI fell by more than 7% in Europe, whilst Ghana alone attracted more than $7 billion as a result of favourable macro-economic conditions. For many regions 2011 was about global supply chain disruptions, currency devaluation, and high interest rates, so with the budgets just around the corner for many governments, attracting FDI is high on the list of priorities. Many have high hopes that 2012 will be a year of proactive policysetting, within which countries can rise and flourish.

Acquisition International speaks to the experts...

COMPORT, a partner for Albania and Kosovo of the major global integrated communication firms, advises locally a number of clients who are developing a $4bln investment portfolio.

With a strong hold on sectors like energy, mining, steel and metal processing, real estate and tourism, retail etc, COMPORT has succeeded to bring commercially to the global market the opportunities of a small, yet very promising economy. Alban Bala, the CEO and owner says they dived into Investor Relations two years ago in an effort to “facilitate both equity and debt financing” to local investors. Albeit the crisis, last year the Albanian banks’ deposits increased by 14%, while the stable macroeconomic indicators showed that intense public investment strategy into new infrastructures was a right choice.

Private Equity Funds and Investment Banks are keenly looking into this emerging market, Bala says.

Albania’s foreign direct investment (FDI) hit $1bn for the first time in 2010. A number of reforms in the last five years ranked Albania the second best performing economy according to the World Bank’s “Doing Business” survey. A slashing of income tax to a flat 10% and cutting red tape has nourished a growing interest by investors from EU, USA and China.

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Energy is the country’s success story with major companies investing in hydro generation, where over 50% of the reserves are not yet utilized. Kosovo – the richest lignite European reserve is appealing for investments in new thermo generation capacities.

Both countries have indefinite wind and solar capacities that shall start to be looked after once Albania will increase its EU integration stake starting

by Fall 2012.

Alban Bala says LNG supply is the best contribution Albania shall make to EU markets with Qatari investors interested to join a liquefied natural gas (LNG) terminal and 1,200 MW generation plant project on the southern coast.

The economic integration of Albanian populated territories in the region has smoothly tripled the market size to 10mio consumers. The number of foreign visitors increases about 20% every year thanks to a Himalaya like beauty of northern Alps, a maiden Mediterranean Riviera and a centuries-old tradition of hospitality. Albania is richer than the city of Rome in historic and natural monuments in a per capita rate.

Albania has no limits of ownership on foreign companies. Foreign companies can lease or buy privately or publicly held land in Albania. They can keep their accounts in foreign currency and transfer their profits without limitations or burdens.

HONG KONG

- Top Spot for Global Business With uncertain prospects in Europe and the US, many companies are looking to Asia, and China in particular, for new business. As a recent survey shows, Hong Kong continues to be a prime location.

Galpin’s views are reflected in the latest survey of foreign companies based in Hong Kong. The annual report released late last year by InvestHK and the government’s Census and Statistics Department showed more foreign companies than ever running regional businesses from the city.

Company: COMPORT Ltd Name: Alban Bala Email: info@albcomport.com Web: www.albcomport.com Address: Rr. Mujo Ulqinaku, Nd.7, H7/53 1001 Tirana Albania Telephone: +355 4 24 24 911

Company: Invest Hong Kong Name: Simon Galpin Email: sgalpin@InvestHK.gov.hk Web: www.investhk.gov.hk Address: 25/F, Fairmont House, 8 Cotton Tree Drive, Central, Hong Kong Telephone: 852-3107-1001

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Enhancing The Flow of FDI “We’ve seen a more than four percent increase from 2010 in the number of regional headquarters, which is very encouraging,” Galpin said. These companies come from a range of sectors and include giants of industry like GE, which consolidated all of its global business, outside the US market, in Hong Kong last August.

the future. The country’s foreign direct investments (FDI) are mostly coming from export processing zones and special economic zones due to the fact that foreign companies investing in these zones are enjoying tax incentives and most of the liberalization of some rules on foreign investments are granted on these industrial or special economic zones.

“We chose Hong Kong because of its excellent infrastructure and proximity to so many of our customers who are based in or around the region. The business world we operate in expects 24/7 service so time zones count,” John Rice, vice chairman of GE global growth and operations, explained.

According to reports, the approved FDI for the fourth quarter of 2011 reached PhP 165.8 billion, and the total posted for 2011 reached PhP 256.1 billion, one the highest level since 1996 and surpassing the PhP 241.1 billion pledges recorded in 1997. Manufacturing consistently leads the highest value on proposed investment ventures followed by real estate. PhP 53.3 billion is committed by investors from the USA and PhP 43.4 billion is proposed by Japanese investors.

While multinationals are always welcome, and are a great vote of confidence in the city, Galpin said, small companies – with fewer than 20 employees – still account for many foreign-owned entities.

“There’s a perception overseas that Hong Kong is a city of multinationals but the small entrepreneurial companies really are the people creating jobs and value in our city,” he added.

One example is Omnitech, an IT services and software solutions provider established by two Indian technology specialists in 1987, which opened its regional headquarters in Hong Kong in 2010. In less than two years, the company has already achieved considerable success in the banking industry as well as winning new clients in the chemicals and airlines sectors. In the next three years, Omnitech plans to employ more than 150 staff in Hong Kong.

For Galpin, all companies are welcome, whatever their size, nationality, or business sector. “If they have an idea and some drive, then we have expert teams at InvestHK that can give them specific advice on how to best set up here. We look forward to seeing even more companies set up this year,” he said.

If you’d like to learn more about business trends in Hong Kong, or how to set up a company, please visit www.investhk.gov.hk.

Manabat Sanagustin & Co. is a Philippine partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.

“I am part of the new management team that led the firm starting 2007. We are one of the country’s leading professional services firm that provides audit, tax, and advisory services. Our professionals are deeply immersed in our client’s businesses and share with them our technical expertise.

The current government’s effort in improving the investment climate in the country includes the leveling of the playing field through a clampdown on corruption. The prudent fiscal management policies of the government have however resulted in a dramatic slowdown in government spending in 2011.

The government also identified key investment areas such as agribusiness, business process outsourcing, creative industries, tourism, and infrastructure. Most recently, President Aquino has expressed renewed interest in the Mining industry. Efforts are also being made to increase the export industry through a more aggressive overseas trade promotion. These combined efforts have resulted in an upgraded investment grade of BB (Standard and Poor) and BB+ (Fitch ratings) and is projected to still improve in

ACQUISITION INTERNATIONAL

In the Asia Pacific region, the Philippines is identified as an investment destination (together with Vietnam and Indonesia) and an alternative to the developed economies of China, Hong Kong, Japan and Singapore. Cost-effectiveness in business operations, rich-English talent pool of graduates and professionals, and competitive real estate development are among the strongest proposition of the country to investors.

of the IAB survey shows that Poland scored well in the covered sectors . Foreign ownership is permitted in 28 of the 33 surveyed investment sectors. Like most EU members, Poland limits foreign capital participation in media, airlines, and airport and port operations to 49%.

Non-EU foreign investors must get permission to own Polish companies and property, but in most cases it is granted. Procedures to establish a foreign business are fairly quick and not complicated. The minimum share capital of a limited liability company is PLN 5,000. Companies are free to open and maintain bank accounts in foreign currency.

Foreign companies can lease or buy privately or publicly held land in Poland. Public owned land is obtained by a right of “perpetual usufruct”. Strength of ownership rights in Poland is high, but access to land information is low.

Poland is a signatory to the New York Convention, and it takes about 15 weeks to enforce a foreign arbitral award. Under the Code of Civil Procedure the arbitration agreement must be in writing. Parties are free to appoint any arbitrator, except for acting state judges.

Private consumption and remittances are among the major economic drivers in the Philippines, making the country a viable market for retailers and the consumer goods industry. While security concerns, mostly in the southern region of the country, are among the top investor concerns, the government is undertaking measures to address these concerns.

Aside from the mentioned tax incentives for companies located in special economic zones, income tax holidays for four to six years can be applied by newly set up companies. Also, entities operating as regional headquarters (RHQ) or regional operating headquarters (ROHQ) can apply for a 15% preferential tax rate on compensation for managerial and technical employees applicable to both Filipino and foreign employees.”

Stampe, Haume & Hasselriis (“SHH”), a Danish law firm, working with local counsel, has conducted numerous cross-border real estate and investment transactions in Poland and throughout Europe.

SHH is experienced and pro-active in assisting investors to complete successful transactions when there are cultural, legal and practical differences.

In addition to being SHH’s Head of Cross-Border transaction, Terry A. Selzer was the managing director of a Danish company and its Polish subsidiaries involved in transforming the former shipyard into a new part of Gdansk Poland. He is the author of a book which advices attorneys and investors on what they need should know to invest across borders.

Foreign Direct Investment (“FDI”) can play a significant role in a country’s economy. For example, although only 1.2 percent of all private companies in Denmark are foreign owned, they account for 18 percent of the total number of employees in the private sector, 21.5 percent of value added to the Danish economy and 27 percent of Danish exports.

An investor needs to know if a country has restrictions to FDI. Poland, since its admission to the European Union, has been a good place for FDI. The results

Company: Manabat Sanagustin & Co. Name: Roberto G. Manabat Email: rgmanabat@kpmg.com Web: www.kpmg.com.ph Address: The KPMG Center, 9/F, 6787 Ayala Avenue, Makati City 1226, Philippines Telephone: (+632) 8850601

Company: Stampe, Haume & Hasselriis Name: Terry A. Selzer Email: tas@cphlaw.eu Web: www.cphlaw.eu Address: St. Kongensgade 49 1264 Copenhagen K, Denmark

Company: Rachier & Amollo Name: Jotham O. Arwa Email: komearwa@yahoo.com Address: Mayfair Centre, 5th Floor Ralph Bunche/Argwings Kodhek Roa Telephone: 00254 202716013

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What’s underneath?

As one of the world’s largest actuarial consulting firms, and a trusted advisor to many of the world’s largest insurance M&A deals, we combine actuarial excellence with in-depth expertise of the insurance industry. We help clients to look beyond the obvious and to identify and quantify the key risk and value drivers associated with complex insurance transactions.

For more information, please contact Scott Mitchell: scott.mitchell@milliman.com or +41 44 287 8062.

SECTOR SPOTLIGHT:

Why Arbitrate in Toronto?

WHY ARBITRATE — in Toronto?

Toronto is one of the best places in the world to arbitrate commercial disputes. Toronto is a more convenient, less expensive and more reliable place to conduct arbitrations than the world’s traditional arbitration centres. It’s also an exciting and entertaining city. suits the needs of the parties and the circumstances of the case. Ontario’s Chief Justice has summarized the support of the Ontario judicial system this way: “We in the courts appreciate the synergy that must exist between an expert commercial arbitration system, and a knowledgeable and effective court system. Courts recognize the benefits that result from attracting fast-paced, global commercial transactions to our jurisdiction. And, we wholeheartedly support [TCAS’s] efforts to make Toronto an attractive venue and leading centre for commercial arbitration”.

TCAS provides a searchable member database to assist you in selecting an arbitrator. Feel free to contact our members to act as arbitrators, counsel or experts on your arbitration. TCAS members are highly experienced in the arbitration field.

Toronto / Canada

Toronto is one of the best places in the world to arbitrate commercial disputes. Toronto is a more convenient, less expensive and more reliable place to conduct arbitrations than the world’s traditional arbitration centres. It’s also an exciting and entertaining city. Toronto, Canada’s economic capital, is considered one the top financial centres in the world. The Toronto Stock Exchange and TSX Venture Exchange are home to 58 percent of the world’s public mining companies. Toronto is a centre for innovation and entrepreneurship in many economic sectors including finance, technology, telecommunications, education, health sciences engineering, media, arts, film and sports. It is the hub of Canadian commerce with a sophisticated financial services infrastructure that a reputation for safety, soundness and stability.

Toronto’s economic activity is driven by a highlyeducated ethnically diverse and multi-lingual work force that reflects Toronto’s cosmopolitan and international character. Heralded as the most multicultural city in the world, there are over 140 languages and dialects spoken within the city.

The Toronto Commercial Arbitration Society (“TCAS”) was formed in January 2010 to promote and develop Toronto as a world centre for arbitration excellence. TCAS members are prominent lawyers, arbitrators, experts and academics with demonstrated experience and interest in arbitration.

TCAS sponsors conferences, develops alliances with other arbitral and financial organizations, advocates for supportive legislation and provides a forum and network for the exchange of ideas on all aspects of commercial arbitration. Toronto is frequently the seat of international commercial arbitrations. All of the major international arbitral organizations

ACQUISITION INTERNATIONAL

including the ICC, LCIA and ICDR arrange arbitrations in Toronto. Toronto is also home to two Canadian arbitral organizations – ADRI (non-profit) and ADR Chambers (private) - with their own rosters of arbitrators and set of arbitral rules. Two private arbitration firms, Neeson Arbitration Chambers and Arbitration Place, also have rosters of arbitrators and can assist with organizing arbitrations. TCAS members regularly sit as arbitrators in these institutional arbitrations.

Until recently, ad hoc arbitrations were the norm in Canada. These arbitrations do not usually require the services of an arbitral institution to assist in conducting the arbitration process. Rather, the arbitration is governed by the parties’ own rules established in their arbitration agreement and, for arbitrations seated in Toronto, the Ontario arbitration statutes. Parties can also adopt the UNCITRAL Arbitration Rules which were designed for ad hoc arbitration.

In 1986, Ontario became the first country in the world to adopt the UNCITRAL Model Law. Ontario’s modern arbitral legislation adopts the principles of party autonomy including allowing commercial parties the freedom to design their own arbitral process and limiting court intervention. Courts are to assist the arbitral process, hold parties to their arbitration agreements and permit arbitral tribunals to determine their own jurisdictions. Arbitral awards are enforceable with very limited judicial review.

Ontario courts have shown a strong willingness to interpret the Province’s modern arbitration legislation in a manner consistent with the philosophy of party autonomy. This provides business parties with an opportunity to tailor an arbitral process that

Toronto is an ideal place to run your arbitration.

Have a look on the TCAS website [www. torontocommercialarbitrationsociety.com] at the CV’s of our members and at the excellent facilities for holding arbitrations. Each of TCAS’s partners has spacious professional facilities and hearing rooms and real time transcription services are available in English and French.

Best of all, most major hotels, restaurants and arbitration facilities in the downtown core are connected by a climate controlled underground mall and walkway facility that means never having to go outside in inclement weather. Toronto is home to world class restaurants, art galleries, theatres, Broadway productions, museums, concert halls and sports teams. It is also known for international festivals and events which take place throughout the year including the Toronto International Film Festival, the Caribana Festival, Nuit Blanche, Luminato and the Toronto International Jazz Festival. Come and enjoy our amazing city!

Company: Toronto Commercial Arbitration Society Name: Randy A. Pepper Email: rpepper@pepperlegal.com Web: www.torontocommercialarbitration society.com Address: 112 Adelaide Street East, Toronto, M5C 1K9 Telephone: +385 91 236 3280

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SECTOR SPOTLIGHT:

Best Practice in Post-merger Integration

BEST PRACTICE

— in Post-merger Integration

If 2011 was the ‘Year of the M&A Revival’ then with success in mind, 2012 should most definitely be the ‘Year of Post-Merger Integration’.

Mergers, acquisitions and divestitures provide many opportunities and can jump-start profitability, but there’s a significant risk of failure, especially when little or no effort is put into the process of PostMerger Integration (PMI). There’s a lot to manage from re-evaluating current practices, understanding cultural differences, kick starting projects that have been in the pipeline to integrating methodologies, systems and processes - not to mention keeping up with the day job. Acquisition International speaks to the experts.

Merlin Piscitelli from Merrill DataSite comments: “Merrill DataSite has provided virtual data rooms (VDRs) for over 20,000 transactional projects, but a VDR doesn’t need to close when an M&A project does.

“All the critical information about a company that’s amassed when a VDR is put together can remain secured and accessible to a newly formed organisation for post-merger integration activity.

Ideally, merging two companies is a seamless process, but in reality it can be a bumpy ride.

We, at Merrill DataSite, understand that M&A professionals need to prioritise certain issues when it comes to integrating businesses, and communication is at the top of the list.”

MERLIN, SO HOW SERIOUS IS THE APPROACH TO POST MERGER INTEGRATION AMONGST YOUR CLIENTS? “Post-merger integration is incredibly important to our clients because the future profitability of their newly formed organisations rests upon it. Clients can’t afford for there to be information gaps, or holes in their data, as this will slow up the integration process and impact on productivity and profitability.

Employee engagement and motivation, at all levels of the business, can suffer as a result of large-scale change and this shouldn’t be exacerbated by poor information flow or an inability to communicate effectively.

Access to documentation, such as employee contracts and personnel records, enables faster integration, optimal productivity to be maintained and a greater chance of ultimate profitability.

Putting together a cohesive and clearly defined management team also helps mitigate integration problems. New management teams are usually comprised of professionals from both organisations and the importance of having clear leadership cannot be underestimated. Our clients don’t want there to be any confusion about who is in what role prior to the conclusion of a deal. With clarity, everyone is able

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to move forward in the new team and in the right direction. This requires HR due diligence, which again can be facilitated with a VDR. HR due diligence; the ability to review critical employee data in the company being acquired, is exceptionally important, as key personnel can’t be left hanging in the balance. In our experience, some acquiring companies don’t act soon enough on their decisions about employee placement due to the fact they don’t know enough about the people they will be employing.

Delaying crucial management or personnel decisions makes integration tougher, which can leave employees frustrated and resentful. Merrill DataSite’s Virtual Data Room (VDR) makes the integration process more efficient and productive by allowing HR and newly formed management teams to access employee files and assess the best candidates to develop the new company with.”

“We use a world class PMI methodology, developed along hundreds of assignments on a worldwide basis.

In addition, we have specific tools to understand, for instance, integration readiness or to develop a specific integration strategy (integration booklet).

We support companies on all steps before and after the acquisition.”

HOW HAS DEMAND FOR POST ACQUISITION INTEGRATION STRATEGIES INCREASED SINCE THE GLOBAL ECONOMIC DOWNTURN? “The downturn environment has determined a decrease in the number and value of deals but, at the same time, as a reaction to the financial driven approach of the past, a significant increase in sensitivity about the operational value drivers and the importance of an early and accurate planning of the integration and of the delivering deal value plan.

PwC DDV team experienced in Italy a growth by 30% per year in the last 4 years.”

Raffaele Cestari, Leader of DDV (Delivering Deal Value) practice at PwC Italy comments: “DDV operates in Italy (20 consultants) as part of an international network with dedicated teams in all the major territories (450 consultants).

“We share approach, methodologies and people, thus offering clients a really integrated international footprint. Main services are: Post Acquisition Integration, Operational Due Diligence, Post Deal Delivering Value, Carve out. To our knowledge, in Italy PwC is the only consultancy firm with a dedicated and specialized team for Delivering Deal Value and Post Acquisition Integration services.”

RAFFAELE ARE CERTAIN TYPES OF FIRMS OPERATING IN CERTAIN SECTORS MORE LIKELY TO MAKE USE OF POST ACQUISITION INTEGRATION? “Some industries are more used to. For instance Oil & Gas and Energy. This comes from a history of acquisitions, and determined a more mature and structured approach and a management culture open to the subject. In general, big size, listing on the stock markets or International Private Equity ownership are other enabling factors.

Entrepreneurial medium sized firms tend to underestimate the issues related to the integration and to dedicate not enough management focus and resources.”

WHEN WORKING WITH A NEW CLIENT, HOW DO YOU ASSESS WHAT STEPS MUST BE TAKEN TO ACHIEVE POST ACQUISITION INTEGRATION? DO YOU HAVE A SYSTEMATIC APPROACH?

Company: Merrill DataSite Name: Merlin Piscitelli Email: Merlin.Piscitelli@merrillcorp.com Web: www.datasite.com Address: 101 Finsbury Pavement, London, EC2A 1ER Telephone: +44 (0) 207 422 6266

Company: PricewaterhouseCoopers Advisory Name: Raffaele Cestari Email: raffaele.cestari@it.pwc.com Web: www.pwc.com Address: Via Monte Rosa 91 20149 Milano Italy Telephone: +39 02 806 461

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Best Practice in Post-Acquisition Integration

BEST PRACTICE

— in Post-Acquisition Integration

Dan R. Bradbary is the Founder and CEO of V-Rooms Virtual Data Rooms. He talks to Acquisition International about best practice in post-merger integration.

Prior to founding V-Rooms in 2006, Dan started and ran a project management consulting firm that grew to 150 people specializing in systems and staffing for a wide variety of projects, including post-merger integration. With that background V-Rooms is able to orient its program to providing a cloud-based, customizable virtual data room (VDR) solution that is designed to streamline document management, collaboration, exchange and archiving for financial, legal and corporate professionals.

The company is finding that clients are increasingly wanting to provide the virtual data room, that has been assembled for completing the M&A transaction, intact to the acquiring company, with all of the due diligence information. The acquiring companies are requesting this because all of the critical information provided is in one very organized location for ongoing post merger integration and downstream financial reporting.

WHAT ARE THE INITIAL STEPS THAT ARE CRITICAL TO MOVING FORWARD WITH A SUCCESSFUL POST-MERGER PLAN?

To clearly define the vision and business benefit of the merger or acquisition, and assign a dedicated crossorganizational integration team is paramount.

Management must specifically define the vision for the integrated organization, while identifying the expected sources of benefit, including accurate forecasts over a specified timeframe. The expected synergies resulting from a merger or acquisition must be clearly identified and communicated if the company expects subsequent financial benefits once the deal is complete.

Step two is assigning a dedicated integration team to ensure that the integration program does not divert attention from managing day-to-day operations.

Executives should allocate specific resources, including members from both of the organizations, to managing the integration. By appointing a project manager and securing strong executive support, businesses are in a much better place to quickly tackle risks and ensure a smooth transition following the merger. It may even be useful to provide key team members with incentives throughout the integration process or until specific results are realized.

ACQUISITION INTERNATIONAL

IN ORDER TO ADDRESS THE POST-MERGER INTEGRATION REQUIREMENTS, HAS YOUR ORGANIZATION DEVELOPED ADDITIONAL PROGRAMMATIC FEATURES TO ASSIST IN THIS EFFORT?

As cross-border mergers and acquisitions become a common way of creating international growth and expansion, it is critical for companies to be able to achieve success in the post-merger integration phase.

Increasingly it is clear that cultural differences play a very significant role in this.

About two years ago, we began to recognize the need to expand the utilization of our VDR program from just a secure document exchange tool into more of a project management platform. So, we added a segment that we call the “V-Rooms Home Page” which incorporates project management features such as identifying the team players (with photos and contact information), an interactive calendar, space for announcements and status reporting, etc.

For post-merger integration projects, these features have been well received by our clients.

These mergers and alliances are fundamentally different from domestic ones, and have to be viewed in a slightly different manner. Since our virtual data rooms have the ability to host information in numerous languages, we provide a platform for cross-cultural communication and collaboration.

Information may be presented simultaneously in a variety of languages, as well as in a Standard English format.

WHAT METHODS AND PRACTICES DO YOU USE TO CREATE THE PERFECT HUMAN RESOURCE STRUCTURE FOR AN INTEGRATION PLAN? First of all from a human resource standpoint, the acquiring company must create protection plans for their “A-Team” players because a merger makes those “A” players especially vulnerable especially to headhunters, regardless of whether they are with the acquiring or the acquired company.

Too often senior managers of the acquiring company are surprised to learn that their own staff members may be ready to make the leap because of the uncertainties about reporting relationships. Job insecurity can lead to a loss of critical talent when they need it the most. Executives who have readyto-roll “re-recruiting” campaigns will be less likely to lose their best employees and can engage them to lead the integration.

WHAT ARE THE KEY FACTORS IN ACHIEVING SUCCESSFUL POST ACQUISITION INTEGRATION? Although the demand for M&A transactions has slowed recently, there seems to be a stronger focus on making those deals work. Historically, 50% of deal outcomes do not meet their goals and some turn into financial disasters. The buyer’s mindset must recognize that the agreement to acquire a company is just the beginning of the project. Like with any long-term deal or activity, M&As are marathons, not sprints, and a lot must be done to get the acquisition team “in shape” before pursuing acquisitions.

By attending conferences and workshops and studying the results of other successful and failed mergers, executives can better prepare themselves and their teams for the project ahead. By testing their own limits and knowledge of M&A practices, executives can approach these complex tasks and target a litany of new business opportunities.

WHAT ARE THE KEY CHALLENGES THAT YOU FACE ON A DAY TO DAY BASIS? It is increasingly apparent that what ultimately makes mergers work is the people collectively working together for a common mission. As a result many managers, often from organizational development backgrounds, concentrate on managing and aligning the different corporate cultures by creating a new common vision. This is quite difficult, especially when different mindsets from different national cultures and languages exist on top of the differing corporate cultures, then the task becomes increasingly complex.

WITH CROSS-BORDER ACTIVITY PROVING SO POPULAR, WHAT ARE THE KEY CHALLENGES WHEN INTEGRATING FOREIGN COMPANIES? AND HOW DO YOU SOLVE THEM?

Company: V-Rooms Virtual Data Rooms Name: Dan R. Bradbary Email: DBradbary@V-Rooms.com Web: www.V-Rooms.com Address: 3535 Peachtree Rd. Suite 520-419, Atlanta, GA 30326 Telephone: 888-316-2047

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SECTOR SPOTLIGHT:

Doing Business in British Virgin Islands

DOING BUSINESS — in British Virgin Islands

Offshore financial centres have come under a huge amount of pressure from international governments to have a more fair and open approach to business; hence the last few years have witnessed a lot of change and the introduction of regulation. That said there are still some very appealing reasons to form offshore and a wealth of great opportunities for both companies and individuals.

Acquisition International’s offshore series aims to identify the key trends in the major hubs and pinpoint the most active and attractive locations.

The British Virgin Islands (BVI) is one of the oldest and most respected offshore financial centres in the world and it is widely considered a benchmark, which other offshore locations try to emulate. Principal activities in the region include corporate domicile, trust and estate planning, mutual fund administration, and management and captive insurance companies and the territory prides itself on providing a safe, secure and stable environment from which companies and individuals can manage their worldwide financial concerns. On January 1, 2005 a new version of the BVI Business Companies Act came into force, which successfully addressed the challenges faced by the offshore financial industry in the 21st century and the country is now innovative in its approach to legislation and scrupulous in its regulation. Acquisition International speaks to the experts…

Folio Administrators Limited was founded in the British Virgin Islands in 2001 with the intent to provide better levels of service in the areas of Hedge Fund Administration and Fund establishment.

Folio has since grown progressively to become one of the largest service providers in the region. Calum McKenzie is the Corporate Services Director with the Folio group of companies, he comments on what factors are attracting companies and wealthy individuals to the BVI and the key benefits of locating here: “As a place for doing business the BVI has many positives and some negative attributes.

However the success of the BVI as a jurisdiction is not based on the relocation of business to BVI it is the unmitigated success of the BVI Business Company, which is in effect an export product. As a place from which to do business the BVI is a beautiful place and with sunshine almost 365 days a year the lifestyle is good. The standard of living is very high compared to most Caribbean islands and there is a good mix of cultures with such a high percentage of the resident population being expatriates. For financial services businesses, the laws are pragmatic and the Regulator is always helpful and willing to listen. The infrastructure exists in the BVI and the local resource pool is rich with talented and experienced people in all areas.”

CALUM, WHAT IS THE PRIMARY CHALLENGES FACING CLIENTS IN YOUR JURISDICTION TODAY? HOW HAVE YOU ADAPTED YOUR SERVICES TO MEET THESE NEEDS? “The primary challenge the BVI has been facing, and will no doubt continue to face for the foreseeable future, is the perception of the jurisdiction as some kind of tax dodging haven for criminals and terrorists. Creating this perception, seems to be the intent of the US Government and ‘watchdog’ organizations such as the OECD. However the BVI has taken

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great strides in combating such perceptions by introducing a great deal of new legislation and regulation to bring the jurisdiction into line with so called international standards.

The result is that the BVI is now a first class financial services jurisdiction that has regulation, oversight, transparency and practices that surpass most of the so called ‘first world’ financial centres. This is of course not without its issues, as felt in all periods of transition. However our clients seem willing and able to deal with this safe in the knowledge that all developments are ultimately for the betterment of all involved and doing business in the BVI. Taking a longer term view of the process it is inevitable that it will lead to even greater successes and prosperity for the BVI. David Griffiths is Head of Marketing and Sales, The AMS Group, The AMS Group was founded in the British Virgin Islands in 1982, with the vision and the commitment to deliver a wide range of Corporate, Fiduciary, Captive Insurance and Mutual Fund client services. This vision and commitment to deliver excellence to our clients is paramount today, just as it was when we were first established.

To meet the continuing needs and requirements of our clients, the AMS group has established offices in Hong Kong, London and Nevis, as well as developing key international partnerships. Through these partnerships and our international offices, AMS provides a local point of contact for all our international services whilst retaining local knowledge and expertise

• No statutory requirement to hold annual general meetings.

• Incorporations within one or two days • Excellent and flexible post-incorporation follow-up services.

• Customized certificate and document verification geared to meet the unique business needs of individual BC’s.

• No disclosure or minimum capital requirements.

• Highly competitive fees and costs.

WHAT CODE OF ETHICS DO YOU ADHERE TO AND WHO REGULATES THEM? HAS THE REGION BEEN UNDER PRESSURE TO ADHERE TO INTERNATIONAL REGULATION? The BVI Financial Services Commission is the Territory’s single financial services Regulator. They are the agency responsible for authorising and licensing companies or persons to conduct financial services business and for monitoring the perimeter of regulated financial services activity to safeguard the public against any illegal and or unauthorised financial services business operating in or from within the BVI. Through the Registry of Corporate Affairs, the Commission is also responsible for the registration of all companies formed in the Territory and for the formation of Limited Partnerships and registration of Trade Marks and Patents.

WHAT FACTORS ARE ATTRACTING COMPANIES AND WEALTHY INDIVIDUALS TO THE BVI? WHAT ARE THE KEY BENEFITS OF LOCATING HERE? By incorporating in the BVI, a company gains a wide range of competitive advantages, which includes: • Exemption from all local taxes and stamp duty • Asset security- the ability to transfer domicile; protect assets from expropriation or confiscation orders from foreign Governments; transfer assets to another company, trust, foundation, association or partnership; merge or consolidate with any other BVI or foreign company in accommodating jurisdictions.

• Maximum confidentiality and anonymity – no requirements to file organizational or accounting information with the Registrar of Corporate Affairs.

• Statuary flexibility in filing Registers of Directors or Members at their own option and in de-registering at any time. This facilitates an appropriate balance combining anonymity with the option to file such business information as determined by the business needs of the BC. • Ease of operation, maintenance and control – BC’s can: • Re-acquire and re-issue their own shares; • Issue shares for consideration other than cash, with or without par value, denominated in any currency; • Have only one subscriber and thereafter only one shareholder; • Have a single directorate’ • Have corporate directors or shareholders; • Hold shareholders’ or directors’ meetings, and maintain books of accounts, records and minutes outside the BVI.

Company: The AMS Group Name: David Griffiths Email: dgriffiths@amsbvi.com Web: www.amsbvi.com Address: Sea Meadow House, P.O. Box 116, Road Town, Tortola, British Virgin Islands Telephone: +44 (0)20 7488 2782

Company: Folio Corporate Services Limited Name: Calum McKenzie Email: calum@folioadmin.com Web: www.folioadmin.com Address: Folio House, PO Box 800, Road Town, Tortola, British Virgin Islands Telephone: (284) 494 7065

ACQUISITION INTERNATIONAL

SECTOR SPOTLIGHT:

Transfer Pricing and it’s Impact on M&A Transactions

TRANSFER PRICING

— and it’s Impact on M&A Transactions

Mergers and acquisitions raise a whole host of transfer pricing issues from tax regulatory issues and compliance aspects to having influence over evaluation and business structure. In M&A transactions, the interaction between transfer pricing and purchase accounting can play a critical role in determining the allocation of the purchase price among the target company’s tangible and intangible assets. Transfer pricing can also play an important role in selecting the financing structure of the proposed transaction.

States in connection with, or shortly following the closing of, M&A transactions. The complex licensing and sublicensing arrangements for intellectual property that are typical for transactions of this type require careful navigation of IP law to preserve standing and damage recovery theories and of tax law with transfer pricing issues of primary import.

As intellectual property assets become the primary assets of our clients and their targets in the 21st century, we expect an increasing focus on transfer pricing issues.”

M&A deals can often provide opportunities to harmonize existing policies. In developing consistency across the organization, a number of factors should be considered in determining which policies should be implemented. It can be difficult enough for acquirers to extract value for their shareholders from transactions and is harder still when due account is not taken of transfer pricing issues. It is therefore of the upmost importance for such companies to seek advice from leading experts to advise them best in this way.

Gene Kwee is Managing Partner, head of tax of VoskampLawyers, one of the largest independent international lawfirms in Singapore.

Sang I. Ji, is a Tax Practice Partner at White & Case LLP. He comments: “Transfer pricing issues in the context of M&A transactions have become more prominent in the Firm’s practice over the last several years for two key reasons”, as stated below.

In addition to a higher proportion of M&A transactions that implicate multiple jurisdictions, taxing authorities worldwide have become more sophisticated in their search for revenues and often assert transfer pricing issues in the face of otherwise technically sound transaction structures. For these reasons, transfer pricing issues are front-and center in the minds of the Firm’s tax practitioners focused on M&A transactions.

“Transfer pricing issues affect valuation of a target, because intercompany transactions that utilize inappropriate transfer pricing methodologies may implicate pre-closing tax indemnities (and related controversy provisions) that are subject to caps or deductibles.

In addition, some transfer pricing methodologies may shift net taxable income into post-closing periods, which could skew valuations on an after-tax basis.

Also, the inertia resulting from sub-optimal transfer pricing methodologies may restrict a buyer’s ability to restructure for post-closing periods. Indeed, all transfer pricing considerations ultimately affect the value of target to buyer or seller.

Transfer pricing issues in the context of M&A transactions also present opportunities for tax practitioners to become value-added service providers. The acquisition of target often will be the best time to make a change from prior practices and perhaps harmonize potentially inconsistent practices of buyer and target. Recently, we have seen transfers of intellectual property (“IP”) outside the United

ACQUISITION INTERNATIONAL

He comments: “The Singapore transfer pricing guidelines are in line with the OECD transfer transfer pricing guidelines for multinational enterprises and tax administrations. In addition to the aforementioned, there are specific provisions in the Singapore income Tax Act and guidelines/circulars that govern the at arm’s length principle in related party transactions, related party loans and related party services.

HOW CAN TRANSFER PRICING AFFECT THE FINANCING STRUCTURE OF A PROPOSED TRANSACTION? AND HOW DOES THIS IMPACT THE BUSINESS STRUCTURE OF THE COMPANY? “As per my previous remark, it has been our view that it is foremost a business decision or occasionally an issue how to arrange or facilitate the funding of such a transaction. It may be the case that a particular subsidiary contemplating the acquisition may not be able to get external funding and thus be reliant on intra group financing arrangements.

As such, tax effective structuring and transfer pricing issues for related party loans may come to the table.”

Tax effective structuring and transfer pricing issues may then ‘lead’ the discussion of the way how the transaction can be financed.

These give guidance to Singapore taxpayers on how to apply the arm’s length principle and how to arrange for the necessary in respect of preparing and maintaining documentation to ensure compliance with the arm’s length principle. The guidance on arm’s length principle and documentation requirements are applicable to all transactions, both local and cross-border, between a Singapore taxpayer and its related parties.

There are particular provisions in respect of Mutual Agreement Procedures and bilateral/multilateral Advance Pricing Arrangement facilities to eliminate or avoid double taxation where parties concerned are residents of jurisdictions with which Singapore has concluded Agreements for the Avoidance of Double Taxation.”

WHY DOES THE INTERACTION BETWEEN TRANSFER PRICING AND PURCHASE ACCOUNTING PLAY SUCH A CRITICAL ROLE IN DETERMINING THE ALLOCATION OF THE PURCHASE PRICE? “My perception is that the valuation of any such transaction would be driven by business valuations and considerations rather than by transfer pricing valuations. Nonetheless, both may come to the same conclusion. One of the considerations of transaction would be the identification of (intangible) assets that are part of the transaction and how such should/ could be valued.

The answer of such a question comes to play as whether to determine whether independent parties would have paid the price accordingly may be substantiated by the price as set or determined by genuine business valuations.”

Company: White & Case Name: Sang I. Ji Email: sji@whitecase.com Web: www.whitecase.com Address: 1155 Avenue of the Americas, New York, New York 10036 Telephone: +1 212 819 8805

Company: VoskampLawyers Name: Gene Kwee Email: gene.kwee@voskamplawyers.com Web: www.voskamplawyers.com Address: 137 Market Street, #03-01, Singapore 048943, Singapore Telephone: + 65 64630535

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SECTOR SPOTLIGHT:

A Guide to Insolvency & Restructuring

A GUIDE TO — Insolvency & Restructuring In the present economic climate, insolvency issues arise frequently, but the range of different forms of insolvency, options and consequences presents a minefield for anyone unfamiliar with this complex area.

In recent years there has been a shift not only from a regulatory perspective, but also with a change of focus away from mainstream formal insolvency towards high profile advisory assignments, including operational restructuring and financial turnaround.

It is of the upmost importance for business leaders who find themselves in such difficult circumstances to gain the right help and advice in order to make the right decision.

This report will look to the experts to offer guidance to businesses and individuals alike in providing practical solutions to the problems of financially distressed underperforming businesses, to provide enforceable ways of dealing with their creditors, in a way that offers real prospects to continue trading and not going into liquidation or bankruptcy. Acquisition International speaks to the experts.

Grant Thornton recently undertook a survey amongst UK restructuring/recovery bankers, asset based lenders and restructuring advisers on the outlook in 2012.

Results showed that 63% of respondents expect a further deterioration of the UK economy, 75% expect default rates to go up and 51% expect trading and pre-pack administrations to increase in 2012. This feedback clearly demonstrates that rather than the UK economy bouncing back, we are almost certainly going to see a further deterioration in the financial health of UK corporates.

At the start of 2008 the Business Recovery profession anticipated a bow wave of corporate failures as a credit crunch and a global economic slow-down converged to create the perfect storm. This wall of insolvencies has, however, not materialised. The principal reason being the influence and policies of the key stakeholders, combined with a relatively weak transactional market for assets. In most distressed situations, it is the financial creditors, predominantly the banks and asset based lenders, who drive the recovery strategy.

This strategy is framed against credit conditions and wider bank policy. From a wider perspective the impact of Basel III and government policy also conspire to influence decision making. These factors have resulted in financial creditors seeking more “sophisticated” recovery strategies rather than defaulting to traditional insolvency methods in order to recover lending. They are now looking to corporate finance type solutions in order to maximise and protect value in recovery situations. As such, we are increasingly seeing the use of Accelerated M&A (“AMA”) and refinancings as exit mechanisms for financial creditors. These strategies are creating buy side opportunities for corporates and other strategic

ACQUISITION INTERNATIONAL

Financial creditors shall continue to be influenced

by Basel III, competition for credit within the banks etc and this shall mean that financial creditors will need to seek exits where it is economically expedient to do so. This will inevitably result in more AMA’s and therefore more opportunities for buyers – both strategic and financial.

• To communicate the plan and obtain support from all stakeholders • To initiate, coordinate and oversee the implementation of agreed restructuring actions, involving key management, generally meeting weekly • To coordinate legal and other advisers involved in the restructuring process, at optimal cost • To mentor and develop the directors along the way ensuring that behavioural change takes place – this could involve rebuilding confidence through a restructure of the board.

Adrian Doble is partner at FRP Advisory LLP, he comments on the Role of a CRO: “In recent years, the Chief Restructuring Officer has become commonplace in even quite small companies.

The CRO is required to be a leader first and advisor second. The CRO is introduced to get the company through its restructuring at pace whilst minimising cost.

Indeed, the experience of restructuring cannot be underestimated, even if it is initially not a comfortable decision to make. It can mean the difference between bank support or default, survival or failure. However, from the perspective of a company, it can be a totally unsettling experience, so following a few basic rules of engagement can ensure a successful appointment is made.

A CRO, once appointed, is there for the duration of the project. As a ship’s captain must stay to the end, so should a CRO. Success and failure go hand in hand.

buyers and in the mid-market we are increasingly seeing special situation funds or “distressed equity” competing against corporate bidders in AMA processes. Indeed we are seeing this on deal sizes at the sub £1m level.

Restructuring is rarely a comfortable path to follow, but done with care, can reap enormous benefits to a business in need.”

“The CRO must work for the company. As one top professional said recently: “When the advisers are asked to leave the room, the CRO stays.” The CRO should be an “Officer” of the company and part of the executive team.

Due diligence on the candidate is essential. We have seen claims on CVs from individuals who have not carried out the full role yet claim the title; who have not taken on the full responsibility that goes with the title or, worse still, who have reported to the lender group. This latter point will ensure disaster as a high level of trust between the company and CRO is critical.

The CRO must never look to replace the CEO. It is always a temporary role unless exceptional circumstances intervene. Often working on a fulltime basis, but reducing over time, the expectations should to be clearly set out and agreed in writing.

Normally a CRO’s key objectives will include: • To create or restore lender and other stakeholder confidence • To stabilise the business using cash and working capital techniques • To take responsibility for the restructuring plan; for debt and capital restructuring; and for operational change. They could even prepare the company for sale in the short-to-medium term

Company: Grant Thornton Name: David Bennett Email: david.bennett@uk.gt.com Web: www.grant-thornton.co.uk Address: Enterprise House, 115 Edmund Street, Birmingham, B3 2HJ Telephone: 0121 232 5217

Company: FRP Advisory LLP Name: Adrian Doble Email: Adrian.Doble@frpadvisory.com Web: www.frpadvisory.com Telephone: 0203 005 4277

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ADVISER MAP:

Contacts from around The World

ADVISER MAP

— Contacts from around The World DOING BUSINESS IN THE USA NAME: Michael Durkee COMPANY: Allen Matkins Leck Gamble Mallory & Natsis LLP PHONE: 001 415 273-7455 EMAIL: mdurkee@allenmatkins.com ADDRESS: 200 Pringle Avenue, Suite 300 Walnut Creek, CA 94596-7367, USA

CROSS BORDER INVESTMENT OPPORTUNITIES 2012 NAME: Pierre-Alexandre Degehet COMPANY: Bonn Steichen & Partners PHONE: 00352 260251 EMAIL: padegehet@bsp.lu WEB: www.bsp.lu www.bsp.lu ADDRESS: 2 rue Peternelchen, Immeuble C2, L-2370 Howald, Luxembourg

DOING BUSINESS IN EGYPT NAME: Darwish Ahmed Hassanein COMPANY: Saudi Egyptian Construction Company EMAIL: ceo@secon-realestate.com WEB: www.secon-realestate.com PHONE: 0020 225789779 ADDRESS: 4 Talaat Harb Street, Down Town Area P.O. Box 145, Cairo, Egypt

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ACQUISITION INTERNATIONAL

DEAL DIARY: Deal Index

DEAL DIARY — Deal Index 58

CROWN POINT VENTURES LTD ACQUISITION OF ANTRIM ARGENTINA S.A

63

ETOL TAKE OVER

58

ATLAS CAPITAL ACQUISITION OF ADEA

63

3I AND FUNDS TAKE MAJORITY STAKE IN COSMETIC PACKAGING LEADER GEKA

58

ACQUISITION OF AHLSELL

64

KBC SELLS WARTA TO GERMANY’S TALANX FOR 770 MILLION

59

ALIGNMENT SYSTEMS ACQUIRED

64

AG ACQUISITION OF LBBW IMMOBILIEN GMBH

59

ACIBADEM DISPOSAL

64

PRIVATE EQUITY FIRM MTS HEALTH INVESTORS LLC ACQUISITION OF WOODBURY HEALTH PRODUCTS INC

59

HERAEUS ACQUISITION OF SWEDISH BIOMAIN AB

65

NBGI ACQUISITION OF ATR GROUP

60

CALLATAŸ & WOUTERS /SOPRA GROUP AGREEMENT

65

LGT CAPITAL ACQUISITION OF 30% STAKE IN QUANTIS INVESTMENT

60

BALLY TECHNOLOGIES ESTABLISHES BUSINESS-TOBUSINESS IGAMING SOLUTION

65

NOVAX INVESTS IN RCO

60

PINOVA CAPITAL TAKES A PARTICIPATION IN CLARUS FILMS GMBH

66

TOREADOR RESOURCES CORPORATION/ZAZA ENERGY, LLC MERGER

61

REITEN & CO FUND ACQUISITION OF MAJORITY STAKE IN CON-FORM

66

TREVISANALAT SPA ACQUIRED

61

GETRONICS ACTIVITIES ACQUIRED

66

THE UNITED BANK LIMITED ACQUISITION OF KHUSHHALI BANK LIMITED

61

AMERISOURCEBERGEN CORP ACQUISITION OF WORLD COURIER GROUP INC

62

CLESSIDRA TAKES EUTICALS STAKE

62

PREMIER DIES CORPORATION ACQUIRED

62

CHARME II ACQUISITION OF 100% BELLCO JOINT STOCK

63

ORANGEFIELD ACQUISITION OF CYPRUS’ FIDELICO

ACQUISITION INTERNATIONAL

April 2012 /

57

DEAL DIARY:

Transactions from Around the World CROWN POINT VENTURES LTD ACQUISITION OF ANTRIM ARGENTINA S.A Crown Point Ventures Ltd, an Argentine focused exploration and production company, has entered into an arrangement agreement with Antrim Energy Inc. to acquire Antrim’s wholly owned subsidiary Antrim Argentina S.A. The principal assets of Antrim Argentina are three oil and gas focused producing concessions in the Tierra del Fuego portion of the Argentine Austral basin currently producing approximately 1,550 boed and an operated 50.1% interest in the Cerro de Los Leones Exploration Concession (Crown Point already holds a 49.9% interest). Crown Point will also assume Antrim Argentina’s working capital surplus, which is currently estimated to be approximately CDN$7.4 million.

Under the terms of the Agreement, Antrim will receive a cash payment of CDN$10,262,356 (subject to adjustments) and 35,761,307 shares of Crown Point (the “Crown Point Arrangement Shares”).

ATLAS CAPITAL ACQUISITION OF ADEA

ACQUISITION OF AHLSELL

Spanish IT firm Indra has disposed of its document management subsidiary Adea to private equity fund Atlas Capital for almost EUR 15 million (USD 19.5m), according to unnamed sources familiar with the transaction, cited by local daily Expansion.

Funds advised by CVC Capital Partners (‘CVC’) has announced the EUR 1.8billion acquisition of Ahlsell, the Nordic region’s leading technical products wholesaler from Cinven and Goldman Sachs Capital Partners. This transaction marks the successful completion of exclusive talks between these parties.

Spanish IT firm Indra sold its document management subsidiary Adea to private equity fund Atlas Capital for almost EUR 15 million, according to unnamed sources familiar with the transaction, cited by local daily Expansion.

Atlas Capital, in fact, has acquired a 98.5% stake in Adea, while the remainder will stay in the hands of Adea’s managers.

Göran Näsholm, President and CEO of Ahlsell, said: “We are delighted by this transaction and are confident that it will result in the building of an even stronger company. CVC has an unrivalled track record of long-term investment in its portfolio companies, and I look forward to what will be a close working relationship.”

Jörgen Graner advised Cinven and Goldman Sachs on tax issues in relation to their disposal of the Ahlsell group, including optimising the tax position within the group prior to the sale. He has a long-standing working relationship with the sellers and the Ahlsell group. Jörgen Graner is tax director at KPMG in Stockholm.

Based on the 20 day volume weighted average trading price of the Crown Point common shares on the TSXV on March 21, 2012, the total deemed consideration for the transaction is approximately CDN $53.75 million. Crown Point will fund the cash portion of the purchase price from its working capital.

Merlin Piscitelli (pictured), Director, Merrill DataSite International, supported the acquisition of Ahlsell by CVC Capital Partners through provision of a premier virtual data room (VDR) solution; vital throughout the due diligence process.

As part of the Arrangement, the Crown Point Arrangement Shares will be distributed by Antrim to its shareholders on a pro rata basis by way of a reduction of stated capital.

Following the completion of the Arrangement, Crown Point will have approximately 104.5 million shares outstanding, approximately 66% of which will be held by Crown Point’s existing shareholders and approximately 34% of which will be held by Antrim’s shareholders.

Merlin has a long standing relationship with Goldman Sachs and Gernandt & Danielsson, the financial and legal advisors on this deal, he comments: “I was introduced to provide a highly secure, online and fully searchable document repository, so thousands of pages of confidential documentation, essential to completion of this billion dollar transaction, could be shared between parties. The Merrill DataSite VDR both eased and accelerated successful closure of this buyout.”

CROWN POINT VENTURES LTD ACQUISITION OF ANTRIM ARGENTINA S.A.

ATLAS CAPITAL ACQUISITION OF ADEA

FUNDS ADVISED BY CVC CAPITAL PARTNERS ACQUISITION OF AHLSELL

Legal Adviser to the Equity Provider & Purchaser

Debt Provider

Legal Adviser to the Purchaser

Legal Adviser to the Purchaser

Financial Adviser to the Equity Provider & Equity Provider

Financial Adviser to the Equity Provider/ Purchaser & Financial Due Diligence Provider

Legal Advisers to the Debt providers

Legal Adviser to the Vendor Tax Adviser

VENDOR’S INTERNAL LEGAL DEPARTMENTS Financial Adviser to the Vendor

Risk & Insurance Due Diligence Provider

Commercial and Vendor Due Diligence Provider

Virtual Data Room Provider

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Legal Advisers to the Debt Providers

Financial & Vendor Due Diligence Provider

Tax Adviser (to the Company)

Commercial Due Diligence Provider

Virtual Data Room Provider

ACQUISITION INTERNATIONAL

DEAL DIARY:

Transactions from Around the World ALIGNMENT SYSTEMS ACQUIRED

ACIBADEM DISPOSAL

FSN Capital LP II has signed a definite agreement to sell Alignment Systems, the global market leader for collision repair solutions, to Polaris Private Equity.

Abraaj Capital, a leading private equity manager investing in the rapidly growing economies of the Middle East, Turkey, Asia and Africa has announced the successful completion of its agreement to divest its entire 50% shareholding in Acibadem Saglik Yatirimlari Holding A.S. and affiliated companies (“Acibadem”) to Integrated Healthcare Holdings Sdn.Bhd (“Integrated Healthcare”) and Khazanah Nasional Bhd (“Khazanah”).

The company started its operations in 1935 and is today present in more than 70 countries. In 2011, Alignment Systems had 250 employees and its sales exceeded SEK 500 million. The company is headquartered in Gothenburg, Sweden. www.alignmentsystems.com.

Alignment Systems was acquired by FSN Capital in 2006.

Since then the company has grown EBITDA by over 50% and expanded operations to become a truly global player with sales in China up from SEK 2m to close to SEK 100m in 2011.

“Alignment Systems has been developed from a hardware focused product company to a complete solutions provider to body shops worldwide. During our ownership period, and in close collaboration with the management team, Alignment Systems has solidified itself as the clear global market leader within collision repair solutions. The company today has a well invested, global and scalable platform set for future growth”, says Erik Nelson, Director at FSN Capital. FSN Capital was advised by PWC Corporate Finance, Vinge and KPMG. The Arthur D. Little team supported Polaris with the Commercial Due Diligence of Alignment Systems. The case team was led by Hampus Dahlstedt who acted as project leader and Jonas Fagerlund who was responsible for the overall quality of the deliverables. Arthur D. Little has supported Polaris on previous successful buy-outs.

Alignment Systems is the global leader within Collision Repair Systems and the key challenge in this case was to assess the growth prospects on a global basis. Arthur D. Little utilized its global reach, interview players world-wide and modelled the global industry.

Under the terms of the agreement, Integrated Healthcare and Khazanah have acquired a combined 75% shareholding in Acibadem from Abraaj Capital and the Aydinlar family through a combination of cash payment and the exchange of newly issued Integrated Healthcare shares.

With the conclusion of this transaction, Abraaj Capital emerges as a shareholder in Integrated Healthcare which will become one of the largest private healthcare providers in the world, with a broad footprint of assets in Malaysia, Singapore, India, Turkey and an operating presence in China, Brunei, Abu Dhabi, Central and Eastern Europe.

Freshfields were international counsel to a major client of the firm, and Mr Mehmet Ali Aydinlar, a very highprofile entrepreneur and his family from Turkey on the sale. The Freshfields team was led by partner Pervez Akhtar (pictured) and senior associate Rob Cant. Mr Altitar commented: “We were delighted to have been chosen to lead the team on such a signifiacnt transaction, both for our clients and for private equity in the region. This was a truly international deal that made headlines across the globe.”

Herguner were Turkish counsel to the sellers led by corporate partner Ms. Senem Ismen, she commented: “The transaction was more challenging than an average acquisition due to the two-way share acquisition, since the consideration payable to Aydinlar and Abraaj for the Acibadem HoldCo shares was in the form of both cash and newly issued IHH shares.”

HERAEUS ACQUISITION OF SWEDISH BIOMAIN AB The Heraeus Dental business group - part of the Hanaubased Heraeus precious metals and technology Group have acquired Helsingborg, Sweden–based Biomain AB. The acquisition strengthens Heraeus’ presence in the Northern European dental market and expands its patent and product portfolio in digital implant prosthetics. Founded in 2002, Biomain AB is the Scandinavian market leader in the field of custom CAD/CAM-produced implant prosthetics and has a workforce of 40 employees. Both Heraeus and Biomain AB have agreed not to disclose the purchase price.Ideal technological and geographical expansion Heraeus’ CAD/ CAM business was expanded in 2011 with an acquisition in Southern Europe. Now the acquisition of Biomain AB strengthens Heraeus’ market presence in Northern Europe as well.

“Technologically and geographically, Biomain perfectly complements our range of products and services,” emphasizes Dr. Martin Schuster, Head of the Prosthetics Division at Heraeus Kulzer GmbH. Biomain’s founder Wistrand assisted the buyer, Heraeus Dental, part of the Heraeus precious metals and technology group, based in Hanau, Germany. Erik Hygrell (pictured) , partner and head of Wistrand’s Company/Commercial department, assisted by Henrik Aurelius, senior associate, of the M&A department. Hygrell commented: “Germany is a significant market for Wistrand and Erik Hygrell and his partner colleague Robert Kullgren are regularly assisting German clients on various transactions on the Swedish market, predominantly within the M&A and real estate financing fields.”

Hübner Schlösser & Cie acted on behalf of Heraeus on the deal. Vincent Huebner, founding partner led the team, he commented: “Challenging valuation in light of future technology and potential of the Target Company, plus competitive bidding process.”

Contact Details: http://www.wistrand.se/1/en-gb/home/home.php

POLARIS PRIVATE EQUITY ACQUISITION OF ALIGNMENT SYSTEMS

HEALTHCARE HOLDINGS SDN.BHD ACQUISITION OF ACIBADEM SAGLIK YATIRIMLARI HOLDING A.S

HERAEUS ACQUISITION OF SWEDISH BIOMAIN AB

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ACQUISITION INTERNATIONAL

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Transactions from Around the World CALLATAŸ & WOUTERS /SOPRA GROUP AGREEMENT

BALLY TECHNOLOGIES ESTABLISHES BUSINESS-TO-BUSINESS IGAMING SOLUTION

PINOVA CAPITAL TAKES A PARTICIPATION IN CLARUS FILMS GMBH

Callataÿ & Wouters have signed an agreement with the banking software business of France’s Sopra Group, entailing the formation of a new entity. Its product offering will consist of Callataÿ & Wouters’ flagship Thaler solution, augmented with Sopra Group’s Evolan software packages.

Bally Technologies, Inc. (NYSE: BYI), a leader in slots, video machines, casino-management, mobile and interactive solutions, and networked systems, has entered into a definitive agreement to acquire Chiligaming LTD’s Business-to-Business iGaming platform. This technology solution will enable casino operators to choose “best-inclass” for wager-based and play-for-free applications. The deal closed on April 4th.

PINOVA Capital, an independent Munich-based private equity firm, has invested into CLARUS Films GmbH.

“The combined size, expertise, customer base and knowhow of the new company will allow us to achieve a strong, strategic leadership position in Europe. Our expanded scope, including a workforce of 1.200 people and an aggregate reference list of hundreds of customers worldwide, will also enable us to serve our markets better,” comments Marc De Groote, CEO of Callataÿ & Wouters, “At the same time, we keep all strengths that Callataÿ & Wouters already had, and are determined to continue our 100% implementation track record.”

Ernst & Young Transaction Advisory Services (TAS) Belgium was engaged by the shareholders of Callataÿ & Wouters to perform financial and tax vendor due diligence. The team was led by Frank Lapeirre, partner at Ernst & Young TAS in Brussels, and Nick Van Gils, Executive Director Transaction Tax. Contact Details: frank.lapeirre@be.ey.com Contact Details: alain.hubert@be.ey.com

“This acquisition provides an open, cloud-based platform for Bally Technologies to offer an integrated traditional and online casino solution to operators worldwide,” said John Connelly, Vice President of Business Development at Bally Technologies. “Equally as important, Bally Technologies has also obtained an experienced team of industry veterans from within the online gaming industry, which will help our customers optimize their use of this platform.”

“I’m very proud of this agreement between our two companies,” said Alexandre Dreyfus, Chief Executive Officer and Founder of Chiligaming. “We are excited to develop our technology, knowledge, and experience with Bally to bring the best value for land-based casinos.”

PINOVA acquired the majority stake of managing shareholder Dr. Sven Dracker in February 2012. Dr. Dracker stays with the company as a member of its advisory board.

Shareholder Thorsten Lang stays on board as Managing Director. Marc Sinnecker and Markus Mondani have been appointed Managing Directors and have also acquired a stake in the company. PINOVA Capital will be represented on the advisory board of CLARUS Films by its Partner Joern Pelzer.

“We were excited by the strong market positioning of CLARUS Films. The market for high quality packaging films will continue to grow and the increasing diversity of packaging formats will require flexible sourcing. CLARUS is well positioned to benefit from these strong market dynamics” says Martin Olbort.

A significant value of Bally’s new iGaming platform solution is that Bally Systems customers will have integration with their Bally slot-management and casino-management systems (ACSC™, SDS™, and CMP™), as well as the Bally Business Intelligence™ solution – giving casinos a single view of their patrons and powerful, enterprise-wide analytics.

Contact Details: richard@nefflaw.com Contact Details: www.nefflaw.com

CALLATAŸ & WOUTERS /SOPRA GROUP MERGER

BALLY TECHNOLOGIES, INC ACQUISITION OF CHILIGAMING LTD’S BUSINESS-TO-BUSINESS IGAMING PLATFORM

PINOVA CAPITAL ACQUISITION OF CLARUS FILMS GMBH

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Transactions from Around the World REITEN & CO FUND ACQUISITION OF MAJORITY STAKE IN CON-FORM Reiten & Co fund buys majority stake in Con-Form – the Nordic leader of building envelopes based on prefabricated concrete elements Reiten & Co Capital Partners VII L.P. (“RCP VII”), a fund advised by Reiten & Co, buys into ConForm, the concrete prefabrication specialist, through a share purchase and capital increase and obtains a 62% ownership.

Established in 1982, Con-Form has grown to become the leading provider of building envelopes based on prefabricated concrete elements for the apartment and hotel building markets in Norway and Sweden. Delivery of concrete building envelopes consist of the casting of foundation as well as casting and assembly of the structural work such as walls, floors, bearing constructions and technical equipment and typically constitute 15-30% of the total cost of a building. Con-Form offers a unique concrete casting frame solution that combines on site casting and pre-cast frames produced in factories. Con-Form has about 320 employees in Oslo, Trondheim, Vest Agder, Stockholm and Gothenburg with factories in Bergen, Lunde, Orkanger, Strömstad and Töcksfors. In 2011 Con-Form generated revenues of over NOK 570 million (€77m) and the current order backlog is worth more than NOK 600 million (€81m).

The market for new apartments in Norway and Sweden is expected to grow by over 30% per annum from 2010 to 2014 (SSB/Prognosesenteret). Uncovered need for housing in the large cities is urgent and Oslo expects a need of 100.000 apartments or houses the coming years. About 75% of the investment from RCP VII is in the form of a capital increase that will strengthen the company’s financial position and enable the company to continue to grow at a rapid pace.

“We have been seeking a new co-owner that can support us in developing Con-Form to reach its market potential and our goal to be the preferred provider of concrete building envelopes in Sweden and Norway. This will be achieved by offering a high quality product with delivery expertise, innovative solutions and a focus on overall project costs.

Reiten & Co shares our goals and can offer us additional financial and strategic input in the future development and growth of the company” says Bjørn Bakke.

GETRONICS ACTIVITIES ACQUIRED AURELIUS and Royal KPN (The Hague, Netherlands) intend to enter into a transaction regarding the acquisition of the Getronics activities in Europe and APAC (hereafter “Getronics Europe and APAC”). Getronics Europe and APAC is an IT service provider offering innovative solutions in the fields of workspace management, data management and hosting, as well as consulting services.

AURELIUS will acquire Getronics Europe and APAC with operational units in seven European and five APAC countries, with a total of 2,900 staff members and a turnover of approximately 450 million euros in 2011. KPN will remain a long-term strategic partner via a minority stake in Getronics Europe and APAC. The intended transaction is subject to customary closing conditions and the relevant antitrust authorities will be notified. The intended transaction is expected to be completed during the course of the second quarter.

Haver & Mailänder advised Aurelius AG on competition on the deal. Dr. Ulrich Schnelle led the team.

Deal contact: us@haver-mailaender.de

AMERISOURCEBERGEN CORP ACQUISITION OF WORLD COURIER GROUP INC AmerisourceBergen Corp has made its biggest foreign step with the acquisition of World Courier Group Inc, a privately held global speciality-transportation and logistics provider for the biopharmaceutical industry. The Valley Forge drug wholesaler is 27th on the Fortune 500 list, and has agreed to pay $520m for World Courier Group Inc. World Courier is headquartered in Stamford, but the key element for Ameri sourceBergen is World Courier’s 137 offices in 52 countries, covering every continent but Antarctica.

“This is our first truly international expansion,” AmerisourceBergen chief executive officer Steven Collis said. “We are a Philadelphia company using capital to expand globally.”

Curtis, Mallet-Prevost, Colt & Mosle provided counsel to long-standing client World Courier Group, Inc. and shareholders.

Curtis lawyers, using the firm’s global office network, leveraged their experience in cross-border M&A transactions to assist in the sale agreement, which was unusually complex due to the large number of countries (52) in which World Courier has offices and subsidiaries and the need to obtain detailed regulatory and corporate information from each.

Curtis was led by partners Lawrence Goodman and Remy Rodas (pictured) and associates Douglas Glazer, Joshua Holt and Kreg Katoski from the Corporate M&A group, partners Alan Berlin and Eduardo Cukier (Tax), Javier Hernandez (Employee Benefits) and Jeffrey Zuckerman (Antitrust/ Competition) and counsel Kuang-Chu Chiang (Tax).

Contact Details: www.bdo.no

REITEN & CO FUND ACQUISITION OF MAJORITY STAKE IN CON-FORM

AURELIUS AND ROYAL KPN ACQUISITION OF GETRONICS

AMERISOURCEBERGEN CORP ACQUISITION OF WORLD COURIER GROUP INC

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Transactions from Around the World CLESSIDRA TAKES EUTICALS STAKE

PREMIER DIES CORPORATION ACQUIRED

Clessidra, Italy’s biggest private equity house, has bought a 30 per cent stake in Euticals in a deal that values the pharmaceutical ingredient maker at more than €300m.

Extrusion Dies Industries, a leading designer and manufacturer of extrusion dies, coating heads and related products for producers of cast film, sheet, coatings and laminates has acquired Premier Dies Corporation.Based in Chippewa Falls,Wisconsin. Premier is a leading designer and manufacturer of slot coating and flat polymer extrusion dies. EDI is a portfolio company of Bertram Capital, a private equity firm headquartered in San Mateo, CA. Bertram Capital provided subordinated debt to finance the transaction. Premier broadens EDI’s fluid coating and extrusion product offerings, expands EDI’s global sales and service network, and provides incremental capacity to support continued growth. Premier operates a state-ofthe-art manufacturing facility, including a full customer trial lab, and serves a diverse set of dynamic end markets including: flexible packaging, medical, pharmaceutical, alternative energy, optical films, electronics, coating, building products, food & beverage, personal care and other consumer products.

Clessidra, Italy’s biggest private equity house, has bought a 30 per cent stake in Euticals in a deal that values the pharmaceutical ingredient maker at more than €300m.

Mandarin Capital Partners, which has offices in Milan and Shanghai, has made a 3x return from selling the stake and cutting its exposure from 54 to 24 per cent.

Euticals focuses on antiviral, oncology, cardiovascular, central nervous system and gastrointestinal ailments and serves pharma giants such as Roche, Pfizer, Merck, Johnson & Johnson and Boehringer Ingelheim.

Since buying a majority stake in December 2008, SinoEuropean private equity firm Mandarin has bolted Poli, Suzhou Tianma Pharma Group Tianji Bio-Pharmaceutical, Archimica and Pharmintraco on to the business.

Euticals employs around 900 people and has seen its revenue increase by almost five times in four years, from €50m in 2008 to a forecast €240m in 2012.

CHARME II ACQUISITION OF 100% BELLCO JOINT STOCK Montezemolo & Partners SGR SpA, management company of the fund Charme II, has reached an agreement with Argos Soditic, MPVenture SGR and Bellco management for the handover of the 100% overall quota of Bellco S.r.l. joint stock to Charme II. “The acquisition of Bellco is in line with Charme II strategy to invest in a limited number of companies, leaders in their own field, and characterized by a great development potential” to quote CEO of Montezemolo & Partners SGR Matteo Cordero di Montezemolo.

“As a technology leader with a world class brand, Premier has distinguished itself in its global marketplace.

Combining EDI and Premier brings together two market leaders and establishes a company that is uniquely positioned for growth with its vast product portfolio, superior design capabilities, manufacturing expertise and long standing customer relationships,” said Kevin Yamashita, Partner. “The acquisition of Premier strengthens EDI’s position as the market leading die manufacturer and supports our strategy for accelerated growth,” added Jeff Drazan, Managing Partner. “EDI and Premier are highly complementary businesses from a technology, market, and customer perspective. The combination will better position the combined entity for growth as they play off of each other’s strengths.”

CLESSIDRA ACQUISITION OF A 30% STAKE IN EUTICALS

EXTRUSION DIES INDUSTRIES ACQUISITION OF PREMIER DIES CORPORATION

CHARME II ACQUISITION OF 100% BELLCO JOINT STOCK

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Transactions from Around the World ORANGEFIELD ACQUISITION OF CYPRUS’ FIDELICO Orangefield has acquired Fidelico, a high performing corporate service provider for management and administrative services in Cyprus. In acquiring Fidelico, Orangefield marks its third takeover since March 2011 and reinforces its European presence as part of a successful global expansion strategy.

Orangefield Group is a global fund administrator and corporate service provider. Its clients consist primarily of financial institutions, multi-nationals, private equity investors, real estate fund managers and hedge funds.

The takeover of Fidelico demonstrates Orangefield’s active expansion drive, focused on ensuring quality in all jurisdictions.

Orangefield CEO Joep Bruins explains: “We do not expand for the sake of expansion alone. It has to make sense.

Fidelico is a good fit for us, because its dynamic and personal approach matches ours. Besides that, delivering locally relevant quality is key in our business.”

ABN AMRO acted as lender on the deal. Willem Six, Rusty Kayser both Directors, led the team.

Contact Details: rusty.kayser@nl.abnamro.com Contact Details: kythreotou@pamboridis.com

ETOL TAKE OVER Frutarom Industries Ltd has announced its successful takeover bid of Slovenian flavours manufacturer Etol dd for €34.6m. This move sees Frutarom further strengthen its presence in emerging markets and also expands its natural flavours portfolio.

3I AND FUNDS TAKE MAJORITY STAKE IN COSMETIC PACKAGING LEADER GEKA 3i, an international investor focused on private equity, infrastructure and debt management, and funds managed by 3i have agreed to acquire a majority stake in Geka, a leading manufacturer of brushes, applicators and comprehensive packaging systems for the cosmetics industry. The company is being acquired from Halder, an investor focused on medium-sized businesses. The acquisition price is not

Frutarom now holds 97.6% of Etol’s shares. Frutarom will act to delist Etol from the Slovenian Stock Exchange and to acquire the balance of shares in Etol from the remaining shareholders.

being disclosed. Geka, headquartered in Bechhofen, Germany, serves both the mass market and premium segment for packaging in the cosmetic industry. In addition, it distributes cosmetics products via its subsidiary Victoria. Founded in 1925, the company has a broad patent and product portfolio. Geka is a pioneer in innovation of plastic

Etol develops, manufactures and markets flavors, focusing on natural flavor products for the food and beverage industry. Etol also develops fruit-based flavors and products and food systems, specializing in local fruits of the region, as well as extensive activities in the growing area of bases for beverages that Frutarom has identified as a strategic area for the company, and in which it plans to further invest in order to substantially expand its activity.

injection moulding for mascara brushes and mascara packaging as well as a development partner of market leading international cosmetics groups including Procter & Gamble, Avon and LVMH. The company runs production facilities in Bechhofen, Germany and in Elgin, Illinois, USA with an additional sales office in France.

The packaging manufacturer employs around 650 staff globally and generated revenues of approximately €100 million in 2011.

Geka’s future growth will come from its strength in innovation and its international expansion, particularly into China and Brazil. This

Etol’s products are sold to more than 47 countries outside of Slovenia, to a wide customer base in Central and Eastern Europe and in emerging markets, including Russia, Poland, the Ukraine, Turkey, Croatia, Serbia, Belarus, Hungary, Slovakia, Macedonia, the Czech Republic, Kazakhstan and other emerging markets characterized by higher than average growth rates in comparison with the world average market growth.

will ensure close proximity to global customers and distribution partners in high growth emerging markets. @VISORY partners acted as Exclusive Financial Adviser to 3i. The deal team led by Ralph Schmücking (pictured), Co-Founder and Managing Director, supported 3i by structuring and co-ordinating the acquisition process.

Ralph Schmücking commented: “In the last decade @VISORY has built a long-term relationship with 3i supporting the private equity investor in various transactions.” With an advised transaction volume of approx. € 1bn

Frutarom’s President and Chief Executive Officer, Ori Yehudai, said: “Frutarom considers this an important and strategic acquisition, which significantly expands Frutarom’s operations in Central and Eastern Europe and strengthens its presence and market share in these fastgrowing markets, and further positions Frutarom as a leading global player.”

in 2011 and 40 professionals @VISORY is a leading independent and privately owned corporate finance boutique. Headquartered in Wiesbaden with offices located in the UK, US and China the company is specialised in midcap transactions with volumes between € 25m and 500m.

Contact Details: Ralph.Schmuecking@visory.de Contact Details: gstreet@deloitte.de

ORANGEFIELD ACQUISITION OF CYPRUS’ FIDELICO

FRUTAROM INDUSTRIES LTD ACQUISITION OF ETOL

3I AND FUNDS ACQUISITION OF GEKA

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Transactions from Around the World KBC SELLS WARTA TO GERMANY’S TALANX FOR 770 MILLION

AG ACQUISITION OF LBBW IMMOBILIEN GMBH

PRIVATE EQUITY FIRM MTS HEALTH INVESTORS LLC ACQUISITION OF WOODBURY HEALTH PRODUCTS INC

German insurer Talanx has agreed to acquire Belgian KBC Group’s Polish insurance unit TUiR Warta for €770 million, subject to closing adjustments. The transaction is expected to be finalized in the second half of 2012, following regulatory approval.

PATRIZIA Immobilien AG: LBBW Board of Directors and LBBW Supervisory Board favor sale of LBBW Immobilien GmbH to consortium led by PATRIZIA Immobilien AGAugsburg, February 13, 2012. PATRIZIA Immobilien AG (ISIN DE000PAT1AG3) has been informed by LBBW that the Board of Directors and the Supervisory Board of LBBW have decided to award the contract for the sale of LBBW Immobilien GmbH and its subsidiaries to a consortium of investors led by PATRIZIA Alternative Investments GmbH, a wholly-owned subsidiary of PATRIZIA Immobilien AG.

Private equity firm MTS Health Investors LLC has acquired Woodbury Health Products Inc, a distributor of incontinence and catheter-related supplies, from HealthEdge Investment Partners LLC, for an undisclosed amount.

Once the transaction is completed Talanx will control the second-largest insurance group in Poland, according to Financial Supervision Authority data.

Aon Benfield Securities Limited was the sole financial adviser to Talanx International AG and Meiji Yasuda Life Insurance Company. After closing of the transaction Meiji Yasuda, Talanx’s Japanese joint venture partner, will acquire 30 per cent of the Warta shares from Talanx International.

The ABS team was led by Ross Milburn (pictured) (Managing Director) together with Paul Rayner and John Rowlands. The ABS team worked closely with Marc Beckers of Aon Benfield (Head of Analytics, EMEA) throughout the transaction.

Ross commented: “The sale of Warta by KBC was a relatively high profile and public process. The target represented an attractive strategic opportunity with a strong market position (being the second largest Polish insurance company) in a growing market. ABS drew on local Polish market expertise within the Aon Group together with specialist skills of the ABS team itself to provide timely advice to its clients.”

The investor consortium led by PATRIZIA Alternative Investments GmbH consists of a number of national and international investors with a long-term focus. PATRIZIA Immobilien AG will participate as an equity investor in a likely amount of up to EUR 15 million. After the transaction has been completed, PATRIZIA Immobilien AG and the companies associated with it will render management and property-related services at market conditions to the acquisition companies as well as LBBW Immobilien GmbH and its subsidiaries. Leonardo & Co represented Landesbank Baden-Württemberg, the seller of LBBW Immobilien GmbH. In the past LBBW was active on the other side of several of their transactions either as principal or financier on the deal.

Ulrich Graebner, Managing Director, Head of Real Estate Europe Tobias Rieg, Executive Director, Project Leader, he commented: “The transaction was executed according to the requirements of the EU Commission who had required the sale of LBBW Immobilien GmbH. Furthermore the deal was characterized by extensive preparation including a complex carve-out process. We overcame these challenges by communicating proactively with all relevant parties and providing exemplary process documentation that left nothing to wish for. In addition - to address political concerns in the context of the privatization of a former social housing company - we provided a social charter that all investors had to adhere to upon acquisition of LBBW Immobilien.”

Oceanside, NY-based Woodbury distributes more than 250 products from four centres in New York, North Carolina, Florida and Alabama. Tampa-based HealthEdge acquired Woodbury in April 2008 from founder Robert Jablonski.

Under HealthEdge’s ownership, Woodbury acquired several medical product distributors. In July 2008 it purchased Med-Zone Inc. In January 2010 it bought Continence Connection and DHP Home Delivery, and in October 2010 it acquired Wilmington Medical Supply Inc. As part of the sale of Woodbury to MTS, MTS partner Oliver Moses, principal Alex Buzik, operating partner Peter Crowley and Peter Vitulli, CEO of DNA Diagnostics Center, another MTS portfolio company, will join Woodbury’s board. Woodbury CEO Brian Darling and the rest of the company’s senior management team will remain on board.

Marwood provided MTS a summary analysis of reimbursement and regulatory risk to Woodbury Health Products.

Specifically, Marwood addressed the outlook for reimbursement under Medicare including the timing and influence of potential changes to the Competitive Bidding program. Marwood also assessed potential reimbursement trends for the Company’s products under Medicaid in two states Florida and North Carolina, where the Company is most concentrated.

Suzanne Gallagher, Director, Advisory Group, Michael Sullivan, Managing Director, Advisory Group, John Kelliher, Senior Managing Director, Marwood Group’s Washington D.C. Office, all assisted in the transaction.

Contact Details: Ulrich.Graebner@leonardo-co.com

TAXLANX ACQUISITION OF WARTA

LBBW IMMOBILIEN GMBH CONSORTIUM LED BY PATRIZIA IMMOBILIEN AG ACQUISITION OF LBBW IMMOBILIEN GMBH

MTS HEALTH INVESTORS LLC ACQUISITION OF WOODBURY HEALTH PRODUCTS INC

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Transactions from Around the World NBGI ACQUISITION OF ATR GROUP NBGI has acquired ATR Group management buy-out from fellow private equity firm Maven Capital Partners.

The lower mid-market focused firm has arranged a £20m equity and debt financing package for ATR, which it said would provide significant capital to help the company grow.

ATR rents specialised equipment mainly to the offshore oil and gas business as well as providing support services such as fleet management, health and safety compliance and inspection.

Clydesdale Bank assisted in the transaction, as did Campbell Dallas, Cameron McKenna and Hirschler Fleischer.

Johnston Carmichael, with a team led by Andrew Walker, Managing Partner, and assisted by Mark Raper, Associate Director, advised the Shareholders of ATR through the successful disposal process.

LGT CAPITAL ACQUISITION OF 30% STAKE IN QUANTIS INVESTMENT

NOVAX INVESTS IN RCO

LGT Capital Management, a subsidiary of Liechtensteinbased asset manager LGT Group, has agreed to buy a 30% minority stake in QUANTIS Investment Management from BROKERNET Investment Holding for an undisclosed sum.

Novax has acquired a 60 per cent ownership stake in RCO, a leading provider of electronic access control products and solutions on the Swedish market. The sellers will continue as owners alongside Novax.

Budapest-based QUANTIS Investment Management is an independent multi-manager which belongs to the BROKERNET Group, a market-leading Hungarian independent financial advisory group.

Novax invests in growth companies within retail, trade and trade-related services and is a wholly owned subsidiary of the Axel Johnson AB.

The transaction will allow QUANTIS Investment and LGT Capital to develop their business in Eastern Europe.

As part of the agreement, QUANTIS Investment Management will be responsible for the regional distribution of LGT Capital Management’s multiple funds in Hungary.

QUANTIS Investment Management CEO Akos Sarandi said that Quantis Investment can leverage the expertise of LGT Group in private banking to deliver innovative solutions to our clients. Under the strategic partnership LGT Group intends to develop new products with QUANTIS Investment Management.

The transaction is subject to authority approval.

Contact Details: http://gfmt.hu/index.php?lang=eng

NBGI ACQUISITION OF ATR GROUP

LGT CAPITAL ACQUISITION OF 30% STAKE IN QUANTIS INVESTMENT Legal Adviser to the Purchaser

EMBER AND SZARVAS LAW FIRM Successfully Exit

Novax was advised by Mannheimer Swartling on the acquisition. The firm’s team was led by Tom Wehtje. Andreas Steen was project leader, primarily assisted by Richard Edström and Thérèze Buskas. Thomas Pettersson, primarily assisted by Emilie Andersson, advised on financing aspects of the transaction. The Arctos sell-side advisory team was led by Robert Bäckström, Partner, Arctos M&A. Robert commented:”We had been in contact with the client for a couple years advising the shareholders on owner-based strategies. The primary challenge during the process was to always be proactive and identify potential risks at an early stage in order to i) keep the process as competitive as possible while at the same time ii) unload the shareholders, who also were members of the Management Team, in order for them to run the day to day business as usual” White & Case acted legal advisor to the founders of RCO Holding AB, Lars Mattsson, Göran Pettersson and Lars-Åke Lidén. The White & Case team was led by Tuula Tallavaara, assisted by Martina Etemad and Christian Reineby.

Tallawaara commented: “It was a highly competitive auction process, where timing and quick turn a rounds became very important, says Martina Etemad. The sellers will partly re-invest in RCO. The parties are a great match it will be exiting to follow RCO Security in its continuing growth with the support and expertise of Novax, and the parties can together bring the company to the next level, says Tuula Tallavaara, who expects that the company may well soon be a listing candidate.”

NOVAX INVESTS IN RCO

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Transactions from Around the World TOREADOR RESOURCES CORPORATION/ ZAZA ENERGY, LLC MERGER Toreador Resources Corporation and ZaZa Energy, LLC, a privately held oil and gas company based in Houston, Texas, have signed a definitive agreement to combine the companies. The combined portfolio comprises three areas – the Eagle Ford core and the emerging Eagle Ford/Woodbine resource plays in Texas and the Paris Basin in France with a current total of 423,000 net acres. Both the Eagle Ford and Paris Basin businesses have strategic partnerships with subsidiaries of Hess Corporation. Based on the closing share price of Toreador on August 9, 2011, the implied market capitalization for the combined company is approximately $294m.

Under the terms of the transaction, ZaZa equity holders will receive approximately 76.2 million shares, representing 75 percent of the new company, ZaZa Energy Corporation, as well as $50 million in notes or cash. Toreador stockholders will receive approximately 25.4 million shares, representing 25 percent of the new Company.

The Company will be headquartered in Houston, Texas, with offices in Corpus Christi, Texas and Paris, France, and is expected to trade on the NASDAQ under the stock ticker symbol “ZAZA”.

TREVISANALAT SPA ACQUIRED

THE UNITED BANK LIMITED ACQUISITION OF KHUSHHALI BANK LIMITED

Italian private equity company Alto Partners has acquired Trevisanalat SpA, one of the country’s leading producers of mozzarella cheese, triggered by the retirement of four of the company’s five founding partners.

The United Bank Limited (UBL) led consortium has acquired 67.4 percent shares of Khushhali Bank Limited (KBL) at a share price of Rs20.44 each. The UBL led consortium has been selected as the highest bidder by the selling shareholders of KBL, a micro finance institution.

Post acquisition, UBL’s direct shareholding in KBL shall become approximately 29.7 percent. Asim Siddiqui, of Ernst Young, led the Transaction Support team, which also included Muhammad Awais, as the Transaction Tax partner.

I am a partner and am the Country Leader for Transaction Advisory Services in Pakistan. Our role was to assist the UBL led consortium in the due diligence process and we carried out the financial and tax due diligence of Khushhali Bank Limited. Khozem A. Haidermota, Senior Partner and Mohammad Anwer, Partner, of Haidermota assisted in the transaction. They commented: “We represented a consortium of sellers comprising of National Bank of Pakistan, MCB Bank Limited, United Bank Limited, Allied Bank Limited, Standard Chartered Bank (Pakistan) Limited, Askari Bank Limited, Citibank N.A., Bank Al Habib Limited, Habib Metropolitan Limited, Royal Bank of Scotland Pakistan, KASB Bank Limited, Silk Bank Limited and Mybank Limited and we have a long standing relationship with such clients.”

Financial details of the transaction weren’t disclosed. Alto is taking a 77.2% stake while the remaining Trevisanalat founder who is also managing director of the company has re-invested and is acquiring a 28% stake.

Trevisanalat sells primarily in Italy with exports accounting for 12% of sales. Some 90% of total sales stem from private label agreements, the rest is attributable to Trevisanalat’s own brands.

Over the last five years company revenue has grown significantly, increasing from EUR25 million in 2006 to EUR57 million in 2011. The acquisition marks the tenth investment made from the firm’s second fund, Alto Capital II.

Contact Details: b.ferri@lek.com

Net production in the Eagle Ford core and the Paris Basin is expected to exceed 1,100 boe/d by year-end 2011, increasing to 5,000 boe/d by the end of 2013, which does not include any contribution from future drilling in the Eaglebine, Paris Basin conventional or Liassic.

Liaquat Merchant Associates (LMA) team was led by Darakhshan Sheikh Vohra (Partner) (Pictued) and represented investors’ consortium of United Bank Limited and four foreign microfinance investment/mutual funds.

Mr. Todd Brooks, Co-Founder and Managing Partner, Land, Legal and Finance, of ZaZa, said: “Our combination with Toreador is the culmination of our efforts over the past two years to diversify our asset base while building a growth oriented company and exploiting one of the most economic shale plays in the continental United States. ”

Vohra commented: “It was most challenging due to complex legal nature and interrelationship of five multi-jurisdictional investors. Funds are subject to their jurisdiction’s stringent legal requirements, donors’/ investment partners’ corporate compliance requirements and Pakistan law requirements.”

Contact Details: www.bingham.com Contact Details: d.vohra@liaquatmerchant.com

TOREADOR RESOURCES CORPORATION/ZAZA ENERGY, LLC MERGER

ALTO PARTNERS ACQUISITION OF TREVISANALAT SPA

THE UNITED BANK LIMITED ACQUISITION OF KHUSHHALI BANK LIMITED

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