Acquisition International May 2011

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May Issue 2011

ACQUISITION INTERNATIONAL The Voice of Corporate Finance

Victoria & Alfred Waterfront acquired for ZAR9.7bn.

AI speaks to Roux van der Merwe, Partner at Glyn Marais about their role on the deal.

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Also in this issue...

• "The Deal of the Month" Michael Heene, Linklaters talks "Strong Savings" • Disposal of Inca Software Ltd • Avellum Partners reinforces Renaissance • Booz & Co does Due Diligence • KPMG advises on the HusCompagniet deal

www.acquisition-intl.com

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Adding value throughout the entire transaction cycle.

URS/Scott Wilson approaches asset ownership and management with the entire lifecycle in mind.

Our services range from environmental, health, safety and operational due diligence assessments to quantify the costs of liabilities prior to purchase, to remediation strategies to reduce or remove financial provisions from the balance sheet, thereby increasing return on investment.

With over 20 years’ experience supporting the industrial, financial and public sectors, our awardwinning team advises on over 150 multi-asset, crossborder transactions each year.

For more information, contact Nick Howard at nick_howard@urscorp.com or +44 (0) 161 237 6050.

URSCORP.EU

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Disposal of Inca Software Limited

Editor’s comment

The market currently feels like “ business as usual”, with no movement either way, with some positive growth numbers released over the last few of weeks indicting Europe is showing signs of recovery.

With a recession rebound expected in Europe, the UK has been showing the weakest levels of growth, compared to their European and International counterparts.

On a plus side, funding methods have been recently released in an attempt to get the UK market growing again, for example the Business Growth Fund (BGF) , which started less than a month ago is already considering investing in ten UK businesses who have been looking for long term growth capital.

Over the next few years the BGF is expected to invest in hundreds of UK businesses that need long term funding to create new products and services, sell to new markets and create new jobs for UK workers.

Sir Nigel Rudd, Chairman of the BGF described it as an exciting start for the new £2.5 billion equity investment fund. He believes the Business Growth Fund offers a real ray of hope to companies that are emerging out of recession. Companies that have the confidence, ambition and ability to seize new opportunities and new markets in the UK and abroad.

Backed by five of the UK's largest banks working in collaboration with the British Bankers' Association (BBA), the Business Growth Fund is one a series of measures to help small and medium sized UK businesses grow out of recession. British Bankers' Association chief executive Angela Knight commented: "UK banks are committed to helping the economy by supporting business. We are committed to helping UK firm’s access the finance and support they need to prosper and grow and the work of the Business Finance Taskforce - through initiatives like Better Business Finance - will help smaller firms by providing help and advice. The Business Growth Fund is designed to address the needs of growing businesses by providing equity funding and I believe it will help make a lasting contribution to the finance options available."

Enjoy the issue!

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

Contents

13

News

4

Deal Guru

6

Lead Mandate

10

Growthpoint and PIC acquires Cape Town landmark for ZAR9.7bn

Deals in Detail

Michael Heene, Linklaters talks "Strong Savings" Disposal of Inca Software Ltd Avellum Partners reinforces Renaissance Booz & Co does Due Diligence KPMG advises on HusCompagniet deal

Sector Spotlight

12 13 14 15 16

The Cost of Justice 18 International Movers & Corporate Relocation 22 Corporate Tax Matters 23 International Corporate Debt Recovery 28 Establishing and Managing Real Estate Funds 29 Destination: Argentina 30 Establishing & Managing Mutual Funds 32 Doing Business in Bermuda 33 Competition & Antitrust Risks in M&A 34 The Secondary Boom 36 Achieving Post Acquisition Integration 41 Insurance & Reinsurance M&A: The Next Hot Spot 42 Company Formations 44 The Company Secretary 48 International Transport and Logistics 49

Deal Diary

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How to contact AI AI welcomes news and views from its readers. Correspondence should be sent to Acquisition International, Blakenhall Park, Barton under Needwood, Burton on Trent, DE13 8AJ. Telephone 0844 809 4788 or email reception@acquisition-intl.com.

For more information visit www.acquisition-intl.com Production by Grapevine Print & Marketing Ltd. 01903 531 531.

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News

Reed Smith advises existing client Telecity Group plc on £100m additional debt funding International law firm Reed Smith has advised existing client Telecity Group plc in connection with £100m of additional debt facilities. The additional facilities have been made available by its existing bank group comprising Barclays, Lloyds, HSBC and RBS (advised by DLA Piper UK LLP), and take its overall debt facilities to £300m with the full amount being refreshed for a further 5 year term.

TelecityGroup is Europe’s industry leading provider of premium network independent data centres and plans to use the new funding to support the expansion of its footprint in Europe both through organic demand-driven growth and bolt-on acquisitions.

Phillip Slater, partner and head of Reed Smith’s transaction finance team in London, led the multijurisdictional team which comprised practitioners in the firm’s Financial Industry Group drawn from the London, Paris and Munich offices.

He was supported by Lucy Newcomb (partner), Chris Akinrele (associate), Lucy Bleach (trainee associate) and Nathan Menon (trainee associate) in London, Stefan Kugler (partner) and Rene Lochmann (associate) in Germany and Anker Sorensen (partner) and Gregory Camus (associate) in France.

Commenting on the transaction, Phillip said:“It has been fantastic to work on this facility extension for Telecity Group. This represents another great result for the company as it pursues its strategy of expansion and growth.”

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Owners of PH Jones vow to continue their success after multimillion pound acquisition

The PH Jones family Martin, Phil, Brenda and Chris Jones A North West family is celebrating after selling its business to British Gas in a £30 million deal.

Set up in a portacabin in his back garden in 1963 by plumber Phil Jones, PH Jones has grown into a highly successful business, with a multimillion turnover, more than 1,200 staff, providing property maintenance and multi-utility metering services to public and private sector clients.

The British Gas deal will see husband and wife team, Phil and Brenda Jones, retire while their two sons, Martin and Chris Jones, continue growing the PH Jones success story through a new business.

Martin Jones, Managing Director of PH Jones, said: “Having nurtured and successfully grown the business for nearly 50 years, the time is right for mum and dad to exit the company and enjoy a well earned retirement.

“We’ve built this business on strong family values and these have been the foundation of its success. Chris and I are going to use these same values to develop our business PH Jones Metering Services.”

PH Jones is made up of three divisions, two of which have been acquired by British Gas – Homeservices, which specialises in services to the social housing sector, and Facilities Management. Martin and Chris will now take equal stakes in the remaining Utility Services division, which already has a healthy £15 million turnover.

Recognising the growth potential for smart metering, Martin and Chris have already set out an ambitious strategy to double turnover by 2014.

Martin added: “By solely concentrating on metering services our aim is to continuously improve the service delivery to all our clients – existing and new.

“PH Jones Metering Services has a great team with exciting potential and prospects. We are committed to becoming the leaders in the metering industry.”

PH Jones Metering Services will operate out of its main Wrexham office and will retain all of its 250 engineers and 50 support staff. Martin and Chris Jones will oversee the strategic development of the business and David Burke, Utilities Director, will continue in his management role.

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News

G

GCP RAISES ÂŁ160 MILLION FUND TO INVEST IN UK SMEs rowth Capital Partners LLP has closed its third Fund, which was over-subscribed, at a level of ÂŁ160m.

Originally targeting £150m at its launch in January 2010, GCP III has attracted a strong global institutional following and is comprised of over a dozen investors participating as limited partners including European Investment Fund, Golding Capital Partners and Lexington Partners. GCP’s underwriting capacity is also significantly extended by a number of the Fund’s investors participating in the firm’s co-invest program.

buy and build, expansion into international markets and operational improvement.

According to Bill Crossan, managing partner of GCP: “Our funding structure enables the SMEs we back to grow substantially as our management teams are highly incentivised through an ability to retain more equity than the traditional private equity model. In addition the advisors we work with know that because we do not rely on external bank debt there is real certainty of delivery.�

GCP’s innovative and proven approach to funding UK based small and medium sized enterprises (‘SMEs’) has been a strong pull both for investors to the Fund and for the management teams which it backs. This is because typically, GCP provides all or the majority of the funding in any transaction through an optimal structure for both the Fund’s investors and investee management teams. This approach avoids the level of risk that is incumbent in higher debt structures with GCP’s investment returns being driven by active value creation through, for example,

Recent examples include Tangerine, the UK’s leading independent confectionery manufacturer which makes Butterkist popcorn; Wrap Film Systems, the owner of Baco Foil; Amor Group, a leading technology business focused on the Oil & Gas, Transport, and Public sectors; and Entec, a leading environmental consultancy. Most recently the firm sold its 40% stake in A-Gas International, which under GCP’s backing had been transformed into a global business, in a deal that valued the company at £70 million, generating a 2.3x return.

ING adds Michal Holly to CEE Corporate Finance team Michal Holly has joined ING as a Director in its CEE Corporate Finance team.

Holly’s main focus will be to develop ING’s advisory and ECM business in the Czech Republic, Slovakia, Hungary and Romania.

He reports to Matthew Hancox, Managing Director, CEE Corporate Finance.

Holly joins from CORPIN, Rothschild's affiliate in Prague. Prior to this he was based in London covering the CEE region at UBS, HSBC and Morgan Stanley.

Matthew Hancox said: “With increasing confidence in the equity markets, we are seeing increased demand from corporates in the CEE region for value-added advisory services, including Mergers and Acquisitions advice as well as capital raising. Michal’s experience and ING’s strong local network are a perfect combination in terms of meeting the needs of our clients in the region.�

This hire builds on ING’s leading franchise in Central and Eastern Europe. Deals closed over the last quarter include the PLN 1.28bn AGT for Tauron Energy, US$ 280m placing for Exillon Energy, EUR 104m Rights Issue for NKBM,US$ 141m AGT for Kernel and the PLN 70m IPO of Industrial Milk Company.

GCP has a broad sector focus and over the last 10 years has invested in businesses throughout the UK. GCP’s distinctive approach of investing across the capital structure and working closely with ambitious entrepreneurs has been a winning formula for the firm’s previous two Funds.

Bill Crossan comments: “We’re excited by the opportunity of deploying our fund through the provision of flexible, patient capital in a market that is the engine house of the UK and where there is significant value.�

Bill Crossan continues: “Our new fund, the strength of our team plus our recent successful exits from Allen & Heath, Entec and A-Gas send a clear message to advisors and SMEs that we are in business to do deals.“ GCP’s Fund II has a realised track record of 2.4x and 30% IRR following three successful exits, which have returned more than the total investments made by the Fund. There are six remaining investments in the portfolio and GCP expects to deliver further value to its investors as it realises these assets in due course.

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The

The Deal Guru

DEAL

GURU Gerald I. Kendall

You Call That A Strategy?

Introduction It is easy to create fantasies on paper.

Therefore, M&A teams assessing the future potential of a company have a significant challenge. As one CFO of a $2 billion steel company described their capital investments, “We would have been better off if we had instead put the money into the bank for the past seven years at the lowest rate of interest.”

M&A teams often review thick strategy documents quickly. Unfortunately, the quality of a strategy is not proportional to the thickness of the document. M&A teams depend not only on an acquired company having a good strategy, but also on executing quickly and successfully. For companies that they are positioning to sell, the M&A company also needs due diligence and quick execution on the owned company’s strategy.

To mitigate the risk of reaching the M&A’s desired ROI, I suggest three quick strategy assessment criteria. I also provide a strategybuilding tool. One CFO who came from an M&A team, told me that he had not seen any tool as comprehensive.

Three Big Red Flags to Look For in a Target or Owned Company’s Strategy 1. The Assumption that Management Time is Sufficient to Execute: The # 1 reason why strategies fail is lack of management

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attention. No, senior management is not lazy – quite the contrary is true. Senior management is already juggling too many balls. Give the strategy a 10% chance of succeeding if it does not formally document what initiatives will be killed and put on hold in order to enable senior management to focus attention on the new strategy. As the President of a utility described, “Every year we add another 25 initiatives to our list.

Every year, the list gets longer, it takes more time to execute, and we have less impact.”

This executive freed up one day per week for his entire senior management team to devote to implementing their strategy.

2. Financial Projections are Unrealistic: P&L and Balance Sheet projections are intelligent guesses containing underlying assumptions. What makes forecasts unrealistic is not backing them up with sufficient detail tactics. For example, assume that I represent a company you are seeking to acquire. It is 2002, and I have a new technology called VOIP (Voice Over Internet Protocol). For 2003, the market is expected to reach $2 billion, and is growing by 100% per year. My underlying market assumption is that I will be at 10% market share, or at least $200 million in revenue, within 2 years. How do you either validate or disprove the assumption at that level?

You can’t! However, with detailed

assumptions about the tactics of the marketing approach, assumptions about why our value to customers is beyond competitor’s, assumptions about the size and close rate of the sales teams, etc., you can apply due diligence. Without detailed assumptions, a strategy is a half-baked solution. On a scale of 0-100 for probability of success based on assumptions, score 10 if assumptions are only stated at a company level, 25 if the depth of assumptions includes functional level, and 80+ if assumptions are stated at major departmental / team levels.

3. Strategy and Tactics at a Single Level: I claim that for any sizable organization, it is impossible for a strategy to succeed if it exists at only one level (the company level).

For example, if the top executive team sets a strategy of becoming the most profitable company in their industry, there are many different directions the company could take to get there. They could focus on higher margin products, or mass cost cutting and efficiency programs, or expanding markets, increasing market share, etc. The probability of misalignment and insufficiency between functional areas is huge with a single level approach. On the same scale as above, score the strategy at 10 if only stated at 1 level, 25 if at 2 levels, 80+ if at 3 levels or more.

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The Deal Guru The Answer – Strategy and Tactics “Tree” Figure 1 shows one example of three levels of strategy and tactics. This document has, in its entirety, 51 “boxes” of detail at level 3.

The first issue of management attention is addressed with the first step of the strategy in box 2.1. The second red flag of unrealistic financial projections is addressed with detailed assumptions, for both strategy and tactics in each box, as shown in the example in figure 2 below. The third red flag is addressed through strategy and tactics stated at three levels, in every box.

What information is essential for an M&A company to properly scrutinize strategy?

1. Understand what the company is going to stop doing, in order to achieve the strategy.

E.g., stop active initiatives to focus management, stop wasting sales time on the wrong prospects, stop shortages in the supply chain, etc.

If a company either doesn’t have or is not actively using a complete strategy document, the Generic Strategy and Tactics tree gives them a structure, some boxes already filled in, and the questions and assumptions needed to achieve a major goal or vision. An M&A company should simply provide the document to them and ask for it to be completed and validated by their top management team.

If you would like a complimentary copy of the generic strategy and tactics tree that I use, including some basic instructions, please visit

www.tocinternational.com or email Gerryikendall@tocinternational.com.

to

Conclusion For M&A companies to reduce risk, increase ROI, and increase velocity of results, the Strategy and Tactics tree is a proven tool.

Strategies and tactics must exist across levels and functions, with assumptions validated, in order to drive bottom line results. When you want to increase the value of a company before selling it, having such a strategy is vital. When you need to validate or increase a company’s future earnings potential, this tool is invaluable.

Fig. 1

2. There must be enough detail, in strategy, tactics and assumptions, below a functional level.

3. There must be an answer to the questions, “Why is this strategy or tactic necessary to achieve the next higher level strategy?

Why will it overcome a major obstacle?”

This is spelled out in the strategy and tactic assumptions (see example above).

These assumptions are critical to assessing the validity of a strategy and associated tactics.

4. The strategy must detail sufficient components to achieve the desired intermediate results and the overall goal.

By doing this at three levels of detail, I often discover missing pieces a priori. This alone can significantly speed up execution and prevent painful mistakes. For example, a manufacturer plans to improve internal capacity by 30 percent within 2 months.

The lead time to increase sales is six months. A strategy that recognizes the sales lead time will achieve results months earlier than one without it.

If a target company already has a very detailed, current strategy, don’t expect them to fill out a strategy and tactics tree. However, use the structure of the document to validate their strategy and ask the detailed questions, by functional area.

Fig. 2

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Consumer and Product Markets

Consumer and Product Markets Consumer and Retail Buyouts The US and Europe are the dominant regions for private equitybacked buyouts in the consumer and retail sector, with the annual number of deals generally slightly higher in the US than in Europe.

However, the number and aggregate value of buyouts was higher in Europe than in the US in 2010. The share of total deals accounted for

by Asia and Rest of World appears to be increasing again following a dip in 2008 and 2009. Annual global aggregate deal value reached a peak of $84.1 billion in 2007 before falling to $14.4 billion in 2008 and $4.7 billion in 2009. 2010 saw improvement: 209 deals with aggregate value of $22.3 billion took place.

The peak in PE-backed buyout deal activity in the consumer and retail sector came in H1 2007, at the height of the buyout boom, with deals worth an aggregate $68.3 billion taking place in the half-year period, including six of the 10 largest PE-backed consumer and retail deals of all time. This was followed by a progressive downward slide into the downturn, with a low point coming in H1 2009, which saw aggregate deal value of $1.7 billion. There has been a steady increase in each half-year period since, with $14.8 billion in aggregate deal value in H2 2010.

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The largest private equity-backed deal in the consumer and retail sector in the past year was US-based clothing retailer J Crew Group, Inc. In November 2010, J Crew Group, Inc. agreed to be acquired by TPG and Leonard Green & Partners for USD 43.50 per share, or approximately USD 3 billion, in a public-to-private transaction. In March 2011, the two private equity firms successfully completed the acquisition.

US Private Equity Firm Activity The quarterly aggregate value of deals made by US-based private equity firms reached more than $200 billion in both Q4 2006 and Q2 2007 before falling significantly with the onset of the global economic downturn. The figures have picked up since, with more than $35 billion in aggregate deal value in each quarter since Q2 2010. 413 deals with an aggregate value of $44.8 billion were announced by US-based firms in Q4 2010, and 391 were announced in Q1 2011 with an aggregate value of $37.2 billion. Q2 2011 has so far seen 205 deal announced by US-based private equity firms, with aggregate deal value of $23.8 billion (figures as of 13th May 2011).

There has been a noticeable shift in the location of investments

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Consumer and Product Markets made by US-based private equity firms over the past few years. In 2006, only 3% of the aggregate value of deals made by such firms was invested in Asia and Rest of World-based companies. The proportion is now significantly larger, standing at 13% of 2011 to date, and 12% for 2010. Deals for companies based in North America made up more than 80% of aggregate deal value in 2006, but they have accounted for less than 70% in 2011 so far.

Notable recent deals made by US-based private equity firms include the $2.375 billion buyout of Capsugel, a division of Pfizer, by KKR, announced in April 2011, and the $2.1 billion buyout of Husky, one of the world’s largest suppliers of injection molding equipment and

services to the global plastics industry, by Berkshire Partners and OMERS Private Equity, announced in May 2011. The largest recent deal by a US private equity house for a company based outside of North America is Rhone Capital’s announced buyout of Evonik Industries’ Carbon Black Unit, an inorganic materials producer based in Germany.

Notable recent exits of companies backed by US private equity firms include Microsoft’s acquisition of Skype from an investor group led by Silver Lake Partners. The group purchased a 70% stake in Skype for $1.9 billion in September 2009, while the deal with Microsoft is worth $8.5 billion, making it the largest private equity-backed exit globally so far in 2011.

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Lead Mandate

Growthpoint and PIC acquires Cape Town landmark for ZAR9.7bn In South Africa’s biggest single property transaction to date, local property group Growthpoint Properties Limited (Growthpoint) and the State-owned Government Employees Pension Fund represented by Public Investment Corporation Limited (PIC) recently acquired one of the country’s prime tourist attractions, the Victoria & Alfred (V&A) Waterfront, for ZAR9.7-billion. Acquisition International speaks to Roux van der Merwe, Partner in the corporate department specialising in M & A at Glyn Marais Inc about their role on the deal.

Glyn Marais was established in 1990 and is a leading South African commercial law firm. The firm is a niche commercial law firm structured around eight main practice areas, namely Corporate Finance, Mergers and Acquisitions, General Corporate and Commercial; Regulatory and Competition Law; Tax; Property; Finance and Banking; Employment; Dispute Resolution, Insolvency and Liquidations and Environmental Law. With offices in Sandton (Johannesburg) and Cape Town, the firm has twelve partners and a total contingent of lawyers of around twenty-seven.

Roux van der Merwe added: “Our size and low gearing of partners result from a deliberate strategy to focus on industries we understand, clients for whom quality of advice and service is paramount and transactions which, by virtue of their size or complexity, require experienced and specialised lawyers.”

“Our firm and many of our partners have been consistently rated amongst the top corporate law firms, by Chambers Global, Ernst & Young's Corporate Finance Survey and a number of other international publications.

“In 2008, we entered into an association with SNR Denton (created following the merger between London-based Denton Wilde Sapte LLP and US firm Sonnenschein Nath & Rosenthal), which makes us the South African member of the largest network of African firms and an associate of one of the twenty-five largest law firms in the world."

“The association enables us to draw on expert skills in areas where there is a skills deficit in South Africa and it facilitates the building of close relationships between member firms through joint training, secondments and sharing of knowledge. This enables member firms to field joint teams and deliver seamless service where the need arises.

Our membership enables us to act for clients on all types of corporate and commercial transactions with a cross-border dimension.”

A prime example of this is the firm’s recent appointment to act on behalf of their new client, Standard Chartered Private Equity on their acquisition of a 30% stake in Afrifresh. The Glyn Marais team was led

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by Willem de Villiers, a partner in the commercial department, who provided legal advice. On the deal he drew from Glyn Marais’ international network, SNR Denton, to complete the deal that involved four jurisdictions.

Cape Town landmark deal The transaction, announced in February and expected to reach financial close in June, saw each of Growthpoint and PIC acquiring an equal 50% stake in the Cape Town landmark, which attracts as many as 21-million tourists a year, from UK-based London & Regional Properties and Dubai-based investment firm Dubai World.

The V&A Waterfront is a 603 868 m2 mixed-use property of bulk development rights with high-profile retail and business tenants on

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Lead Mandate long-term leases. About 220 000 m2 of the property remained available for development.

respective contributions to be made by each of them to the future development of the V&A Waterfront.”

Growthpoint is believed to have secured ZAR4,9-billion for its portion of the transaction, which would primarily be covered through long-term debt funding and would boost the company’s total property assets to above R40-billion.

“The appointment came about as a result of our strong working relationship with Growthpoint, which has been established over a number of years together with the our existing relationship with the PIC.”

Van der Merwe elaborated on their role on the deal: “I was the lead attorney in the Glyn Marais team who advised Growthpoint on the acquisition and the related funding arrangements.

“Our commercial property department, headed by Brian Frank, assisted Growthpoint and PIC in respect of a detailed due diligence undertaken on the property assets of the V&A Waterfront.

“We also assisted in structuring the relationship between Growthpoint and PIC as joint owners of the property post the acquisition, taking into account the

“The main challenge of the deal was the tax structuring around the settlement of the various existing debt arrangements held by the international sellers, in order to achieve the most optimal replacement thereof with funding to be provided by Growthpoint and PIC in conjunction with the acquisition of the equity in the holding company of the V&A Waterfront.

“We worked closely with the other advisers such as Investec Bank Limited and Ernst & Young on developing the structure to achieve tax efficiency to the benefit of all parties to the transaction. Our tax and finance departments (headed by Richard Glyn and Willem de Villiers respectively)

also played an important role in this regard.”

“I feel that we added value to the deal, by rendering a full set of transaction specific services including M&A, property, finance, tax and competition law and streamlining these areas to ensure the most optimal outcome for Growthpoint and indeed the other parties to the transaction. We also maintained a quick turnaround on all transaction steps in order to facilitate and finalise negotiations with the international sellers.”

Glyn Marais Inc also brought extensive experience in M&A in both local and international public and private sectors to the deal table. Recently the firm has advised on a number of transactions including UCS Group Limited’s (a major listed IT company) ZAR750million disposal of certain subsidiaries to Business Connexion Group Limited (another major listed IT company) and Santam Limited’s (South Africa's largest short term insurance company) ZAR1billion black economic empowerment transaction.

Roux van der Merwe

Address: 2nd Floor, The Place, Sandton Drive, Sandton, Johannesburg, South Africa, PO Box 652361, Benmore, 2010 Telephone: +27 11 286 3700

Email: rvdmerwe@glynmarais.co.za Web: www.glynmarais.co.za

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Deal of the Month

KBC builds up "Strong Savings"

Michael Heene Email: michael.heene@linklaters.com Web: www.linklaters.com Address: Graanmarkt 2, B-2000 Antwerp, Belgium Telephone: 0032/3.203.63.52

KBC Group recently reached an agreement with Crédit Agricole (Belgium) for the sale of its subsidiary Centea (Belgium) for a total consideration of €527m. The transaction has been awarded “Deal of the Month”, as the addition of Centea to the Crédit Agricole Group is a major step in the growth and diversification policy that the bank has been pursuing for many years. Acquisition International speaks to Michael Heene, managing associate Corporate department, Linklaters Belgium about their role on the deal.

Previous experience “Ever since the credit crunch, Linklaters Belgium has been heavily involved in bank restructuring work; The Linklaters team in Belgium was involved in all three major bank rescue operations in Belgium (KBC, Fortis and Dexia) and a lot of the M&A work that resulted therefrom. Currently, our corporate team in Belgium is heavily involved in three other major restructuring operations for global financial institutions.

Linklaters is a leading global law firm. The firm’s global approach and commitment to excellence ensure the highest standards of quality and service.

“This focus on the financial services industry forms part of the global expertise Linklaters has built up over the years in complex restructurings of financial institutions such as the Lehman Brothers liquidation and the demerger of ABN AMRO following the takeover

by Fortis, Santander and RBS. The latter deal I actually worked on during most of 2009, during a secondment to Linklaters Amsterdam.”

Linklaters is recognised as the market-leading law firm in Belgium, with a presence in the Belgian market dating from 1969 and with offices in both Antwerp and Brussels.

Michael Heene elaborated: “Our Belgian offices currently have over 130 lawyers, of who 27 are partners. At the heart of Europe, our Belgian offices play a pre-eminent role in cross-border work within the global Linklaters network.”

Centea Transaction Centea is one of the strongest savings banks in Belgium and a renowned brand. The company caters for the banking and insurance needs of more than 615 000 private customers, the self-employed and small companies through an extensive network of 657 points of sale operated by 608 tied bank agents across Belgium. Its comprehensive range of products includes deposits, investments and loans, as well as life and non-life insurance provided in close co-operation with Fidea (the complementary network of insurance brokers owned by KBC).

Michael Heene commented: “Our Linklaters team, consisting of Jean-Pierre Blumberg (European managing partner), Nico Goossens (Corporate partner), Etienne Dessy (Capital markets counsel), Elke Duden (Employment counsel), Noemi Blumberg (Corporate associate) and myself, advised KBC Group on the sale of Centea, a Belgian retail bank, to Crédit Agricole SA/Landbouwkrediet NV. “The transaction forms a key part of the EC-imposed restructuring of KBC Group following the state aid received during the financial crisis. This deal builds further on the excellent relationship Linklaters has had with KBC Group over the years and which has resulted in, amongst other things, Linklaters advising on key milestones in the history of KBC Group such as the merger of KBC and Almanij in 2005 and the capital injections by the Belgium State and the Flemish government in 2008 and 2009.”

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Key issues “Centea runs its operations from the KBC IT systems. Also, a lot of Centea’s back office work is done by KBC. This close association between KBC and Centea required us to construe (i) a transitional services framework pursuant to which KBC will service Centea for a transitional period of up to three years (this was also an EC-imposed requirement) and (ii) a migration plan relating to the IT migration of the Centea data from the IT systems of KBC to the IT systems of Crédit Agricole/Landbouwkrediet. This so-called “separation plan” will guarantee the standalone nature of the Centea business following the sale by KBC and therefore adds significant value to the transaction.

“When drawing up the separation plan, we built further on our recent experience in the Fortis carve-out and the ABN AMRO demerger, where we have been involved in similar exercises. Also, thanks to our close cooperation with other Linklaters offices (London, Amsterdam); we were able to make use of Linklaters’ global expertise in the financial services industry. The separation plan, which was prepared by us in close co-operation with the investment bankers (KBC Securities and Morgan Stanley) and the KBC and Centea business people, was described by many of the bidders as “unique for the Belgian market”.

“This illustrates Linklaters’ unique position in the financial services sector in these exciting times: with the downturn come new challenges, including new legal challenges which call for innovative legal solutions.

Thanks to its size and close cross-practice and cross-jurisdiction collaboration, Linklaters has been able to build up a vast amount of legal expertise in a completely changed world. We have done this in a mere two or three year timespan. I truly believe this is what sets Linklaters apart from all of its competitors, both domestically and globally and makes us the market leader we are.”

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Deal in Detail

Disposal of Inca Software Limited

Marcus Hanke Web: www.avisen.com

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in December 2010. As Inca was already a tightly run, well controlled business, we didn’t have to prepare it for sale; we just ensured that these processes and procedures were maintained so that the Due Diligence process would run smoothly.

Inca is the largest UK IBM Cognos partner, providing customers with the full suite of IBM business analytics products, and was acquired by Logicalis UK Limited for a total consideration of £8.65 million.

“In just 18 months we sold Inca for a total consideration of £8.65 m (£7.3m of cash and the assumption of £1.35 of net liabilities). This total consideration represented 62% of Avisen’s market capitalisation on the date of disposal.”

Acquisition International speaks to Marcus Hanke, CEO of Avisen plc, the vendor, about the rationale behind disposal and how the sale fits into the Avisen’s long term growth strategy.

Marcus was closely involved in the negotiations on the sale price and he was able to convey to the buyer the potential benefits/opportunities that they could achieve from buying the Inca business.

Avisen plc is a business and technology consultancy specialising in performance management with a focus on strategy creation, development and implementation. The Company provides advisory services and software distribution in the corporate performance management market.

Marcus elaborated: “Not only from the addition of the Inca trade to its business but the other benefits could it bring to its existing business.”

n 16 March 2011, Inca Holdings Limited ("IHL"), Avisen plc.’s indirect and wholly owned subsidiary, entered into a binding sale and purchase agreement relating to the proposed disposal of the Company's wholly owned subsidiary, Inca Software Limited ("Inca").

Avisen aims to provide specialist advice to enable organisations to build more effective capabilities to manage the performance of their business and allow them to achieve their desired targets.

Marcus, how long were Avisen contemplating the sale of Inca before you started in earnest?

“Inca was and still is a good solid business which would of always provided a reasonable return on our initial investment of £3.5m (August 2009) but to take the company to the next level , we needed to either make a significant investment or acquire another company that complemented Inca, to gain synergistic benefits, thus elevating ROI. In the same vein, we aware that Inca would be of interest to other companies that already had infrastructure in place to gain synergistic and other benefits out of the Inca business.

“We never actively put the company up for sale, we were approached

He elaborated: “The sale of Inca will provide the Group with an excellent platform from which the company will be able to create significant long term shareholder value.

“We will be able to provide further investment into the Group’s remaining business divisions and in particular to aid the launch of its next generation SaaS Storage Analytics solution in its subsidiary Storage Fusion. Avisen will also pursue suitable, complimentary acquisition opportunities as they arise to accelerate the growth of the Group.

“Furthermore, Storage Fusion is involved in one of the global IT industry’s hot growth spots, which is undergoing considerable consolidation. Moreover, the business will launch its latest software suite in the next few weeks, which should stimulate revenue growth.

"In conclusion I would like to thank the senior management team of Inca for their help in growing the business to this stage and I look forward to providing further positive announcements as we seek to implement our ongoing growth strategy."

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Deals in Detail

Reinforcing Renaissance

A

cquisition International speaks to Mykola Stetsenko, Managing Partner of Avellum Partners about how the firm “adds value” to transactions and their recent role on the Renaissance Credit deal.

Mykola Stetsenko Email: mstetsenko@avellum.com Web: www.avellum.com Address: Leonardo Business Center, 11th floor, 9-21 Bohdana Khmelnytskoho Str., 01030, Kyiv, Ukraine Telephone: +380 44 220-0335

Ukrainian operations to SCM Group, a decision taken as part of Renaissance Credit’s strategy to concentrate on the expansion of its consumer lending business in Russia.

Avellum Partners was established in July 2009 and since then has advised on numerous M&A transactions, covering all major industry sectors from banking to transportation.

Renaissance Credit began operations in Ukraine in 2005. The bank’s regional network spans 17 regions of Ukraine and consists of 31 branches. The bank has shown positive results in 2010, posting a UAH4.43 mln profit in 9M10.

Avellum Partners provides legal advice to their clients with respect to their most significant business transactions in banking and finance, capital markets, mergers and acquisitions, and restructurings.

Avellum Partners provided legal advice to Renaissance Credit Group on the deal, after working with their long term client on a number of sophisticated transactions from a number of key sectors.

“We have one of the largest professional legal teams in Ukraine and we have closed more than a dozen of M&A deals in 2010 and early 2011.” Commented Mykola Stetsenko.

Mykola Stetsenko elaborated: “In this transaction we provided sound legal guidance to Renaissance Credit Group and helped them to achieve good compromise on deal-breaking issues with the other side. Given that Renaissance Credit is a banking institution, some additional time and effort was spent on receiving regulatory approvals.”

“We help foreign and Ukrainian investors to close complicated M&A transactions successfully and promptly. We specialize in matters that require special attention, extensive experience and industry expertise.

“We do this by using the most advanced Western methods and approaches coupled with our deep industry experience and everyday practice. This is an area where Avellum Partners really does add value to the deals we advise upon.”

The deal

December 2010 saw Renaissance Credit announce the sale of its

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“The transaction also required elaboration of sophisticated completion and settlement mechanisms, which worked very well at the end of the day. A large number of transaction documentation also contributed to the complicated nature of this transaction.”

“All in all, the transaction went very smoothly due to the professional approach taken by both parties and their legal advisers.”

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Deals in Detail

Daniel West Web: www.booz.com Address: 7 Savoy Court, Strand, Wc2R 0JP Telephone: +44 (0) 207 393 3333

Doing Due Diligence

and Deals M

ontagu Private Equity, one of Europe’s leading private equity companies, recently announced the agreement to acquire Helly Hansen Pro in partnership with its existing management team from the Helly Hansen Group.

Acquisition International speaks to Daniel West, Principal and Member of the European Energy team focused on Oil & Gas strategy and commercial due diligence at Booz & Company about how their experience on similar transactions helped them perform their role on the deal.

Booz & Company is a leading global management consulting firm, helping the world’s top businesses, governments, and organisations. The founder, Edwin Booz, defined the profession when he established the first management consulting firm in 1914. Since then the firm developed the concept of human capital in the 1940s, product life cycle in the 1950s, supply chain management in the 1980s, smart customization in the 1990s, and organizational DNA in the current decade.

Most recently, Booz & Company introduced the concept of Capabilities-Driven Strategy, founded on a pragmatic series of choices designed to help enterprises achieve increasing levels of coherence that can reliably and sustainably outpace competitors and create a right to win.

Today, with more than 3,300 people in 60 offices around the world, Booz & Company

bring foresight and knowledge, deep functional expertise, and a practical approach to building capabilities and delivering real impact.

Daniel West added, “Booz & Company is frequently contracted to perform similar work to the Helly Hansen Pro deal, both in the energy sector and more widely. We work with many leading investment funds as well as most of the world’s major oil and gas companies.”

Helly Hanson Pro acquisition HH Pro is a leading provider of survival and personal protection suits to predominantly the offshore and shipping markets. Going forward the Company will be rebranded “Hansen Protection”.

HH Pro, headquartered in Moss, Norway, has ca 140 employees and is predominantly active in the Nordic region. It is organised in three main business segments: survival suit rental, used by personnel in their transport between land and offshore installations (oil and gas rigs), personal protection suits, used in other marine and hazardous environments (navy, chemical plants, fire brigades) and pro textiles, which includes boat canopies and products for the agriculture, industry and health sectors.

With the support of Montagu, management plans to continue its impressive track record of growth by expanding into

adjacent markets and product categories and thereby capitalising on the huge opportunities its markets provide.

Booz & Company performed commercial due diligence of the target on behalf on Montagu Private Equity. The firm was appointed based on the strength of their capabilities within the global oil & gas sector and prior successful work on behalf of Montagu.

The team provided an independent perspective on both the strength of the targets core businesses and the potential for growth opportunities in its domestic and international markets.

Daniel West answered: “The key issues we had to resolve on the deal involved answering: 1) How is Helly Hansen Pro’s core market could be expected to evolve and what is a reasonable expectation for its future size? 2) How robust Helly Hansen Pro’s current market position was from a competitive perspective and what are potential future risks? 3) What additional commercial opportunities might there be for Helly Hansen Pro; both in its core markets and beyond? 4) Given all of the above, how robust was management’s business plan?

“Our role in summary m defined what growth can be expected in the future, which was a key driver for what price to pay for the company. I believe this is where we added value to the deal.”

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Deals in Detail

Søren P. Krejler Email: skrejler@kpmg.dk Web: www.kpmg.dk Telephone: +45 3818 3726

FSN Capital acquires HusCompagniet T

he Nordic private equity fund FSN Capital recently acquired HusCompagniet, Denmark’s leading producer of single-family homes from Axcel. Acquisition International speaks to Søren P. Krejler, a Partner and Head of both KPMG's Transaction Services and Private Equity Group in Denmark about the firm’s role on the deal.

report is made on behalf of potential buyers who need an independent analysis for their own understanding and information that can be presented to the financing bank.”

Søren P.Krejler commented: “In Denmark as well as globally, KPMG is a market leading provider of audit, tax and advisory services. In Denmark we employ more than 1,400 people in 23 offices located all over the country.”

“We participated early in the process and helped define the information needed for this transaction and what issues should be considered. During the process we ensured the quality of information and that data problems were solved in a timely manner so that the process was constantly running smoothly and on track according to the time frame we were working under.”

“At KPMG we offer our clients a broad array of audit, tax and advisory services and today our advisory services are as comprehensive as the services offered within audit and tax. We have specialised in transforming expert knowledge and high professional competences into business value for both small, medium- and large-sized companies and organisations in the public as well as in the private sector.”

Søren what were the key issues you had to deal with?

“The financial crisis has generally been a challenge for the housing market; However HusCompagniet has performed well despite a declining market. The financial crises affected the company's figures in late 2008 and 2009 which made them less comparable to 2010 where HusCompagniet experienced growth.”

Søren P. Krejler added: “We are a part of the global KPMG network of audit and advisory firms, which is represented in more than 146 countries all over the world. No matter which part of the world we operate in, we apply the same tested methodology and tools to provide sound assistance to our clients.”

KPMG's Transaction Services in Denmark brought a wealth of extensive experience with vendor due diligence reports to the deal table having acted on a number of large key transaction in the past, including, more recently, the sale of Danfoss Household Compressor, EAC Ingredients and Superfos Industries.

FSN Capital acquires HusCompagniet HusCompagniet is the leading standardised, single-family house builder in Denmark. The company has developed a proven conceptualised business model based on lean processes, uniform principles, a standardised outsourcing model and a structured, guided sales process.

Today, HusCompagniet has an 18% market share. In 2010, HusCompagniet had a turnover of approximately 1 billion Danish kroner with an EBITDA (earnings before interest, tax, depreciation and amortisation) of 101 million Danish kroner. In comparison to the previous year, turnover increased by 26 percent and profit by 15 percent.

Within the housing market and building sector the firm has assisted in transactions related to Junckers, Aalborg Portland and Trelleborg, which the firm drew upon advising on the HusCompagniet transaction.

KPMG's Transaction Services in Denmark acted on behalf of Axcel the vendor on the deal. Their appointment to act as advisors stemmed from a long standing relationship, Søren P. Krejler elaborates: “We have worked with Axcel on numerous occasions in the past and were contacted when they wanted to sell HusCompaniet.

“Our role was to prepare a vendor initiated due diligence report which contains analysis of financial information used for valuation purposes, but it also gives an in-depth understanding of HusCompagniet. “Our

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Søren P. Krejler concludes on how he and his team of advisers added value to the deal: “When potential buyers receive a vendor due diligence report it reduces the number of questions/uncertainties they might have because extensive information is already contained and described in the report. The analysis presented helped the possible buyers obtain a better understanding of the effect of HusCompaniet's purchases of companies and changes in sales mix.

“Also, in a process of this kind the seller benefits from a reduced number of questions from multiple buyers. This resultantly allows the seller to keep focus elsewhere. Going through a sales process can often be a straining task on the entire organization and in particular for the employees handling the transaction because they also have to keep up with normal day-to-day operations. We are able to assist them in prioritizing what information is relevant thereby ensuring they do not spend time on things unnecessary.”

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Deals in Detail

Looking back…

Global M&A for Q1 2011 totalled US$ 591bn, up 28.9% from the same period in 2010 (US$ 458.4bn). It was the busiest Q1 period since Q1 2007 which closed at US$ 806.9bn. Acquisition International speaks to Dev Erriah, partner at Erriah Chambers about the last quarter and the economic climate in Mauritius.

Erriah Chambers is a high-quality Chambers specialising in International tax law, International trusts law, International Business laws and all aspect of offshore business activities.

“Erriah Chambers is distinguished not only by the depth and scope of its legal advisory services, but also by unmatched experience in the international arena. The Chamber's has a vast experience in multijurisdictional issues in numerous legal systems.

Consequently, we are known for guaranteed effectiveness in helping clients accomplish their objectives in environments others find daunting and unfamiliar.

“Currently Mauritius is progressively paving its way in establishing a solid investment fund industry in the offshore sector, the banking sector alone is over $1 billion. About 90% of the active funds invest in Indian securities and shares and more than half of the registered offshore funds are listed on international stock markets. South Africa, the United States and India represent the major sources of offshore investment and often the destination of investment, include, amongst others, the BRICT countries.

“The sectors which have been most active have been the banking and international finance sector including cross border transactions and trusts. Buyers range locally to overseas including amongst others Singapore, Hong Kong, India, United Kingdom, Switzerland and South Africa.

“Currently deals are most commonly being funded by banks and are typically taking 2 to 3 months to complete, depending on their complexity and completion of full due diligence exercise.

“We have been involved in a various notable deals over the last quarter, inter alia, a cross border loan transaction for an extended loan amounting to USD 55 million with the borrower from Caymen Islands, multiple guarantors from Mauritius and Investec Bank (UK), syndicated loan transactions notably between various local banks for an amount of MUR 350 million and EUR 1.5 million and other loan transactions between local and foreign borrowers and SBI (Mauritius) Ltd for amounts varying from USD 15 million to 40 million.”

Has there been much secondary activity (SBOs) in Mauritius this quarter?

“Small business owners are taking aggressive steps to put their companies in a better place to capture business. The signs of recovery are bursting: SBO’s are innovating and creating jobs. SBO will definitely keep booming this year, particularly that they are well protected by law in Mauritius and the Government greatly assists SBO’s by variou0s stimulus packages, to allow development.

Do you have any predictions for the next quarter / 12 months?

“We expect to see a higher level of investments and a few joint ventures. The stabilisation of Securities Act in Mauritius along with many more regulations is very much assisting the monitoring of the framework. The Securities (Collective Investment Scheme) Regulation 2008 regulates all collective investment schemes and close-ended funds, therefore opening doors to more investors, including expert investors and sophisticated investors, to target investments in emerging economies. The Financial Services Commission provides a strong framework for global businesses which should prove beneficial and productive.

“We have recently seen the opening of the first Islamic Bank in Mauritius for retail and investment banking and with the everincreasing improvement of the local legal and regulatory framework to cater for Islamic Banking practices; we may anticipate an increase in demand for legal assistance in this specialised practice.”

Dev Erriah

Address: 2nd floor, Les Jamalacs Building, Port-Louis, Mauritius Email: deverriah@intnet.mu

Telephone: +230 2082220

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The Cost of Justice

Lightening the load L

ocated in the heart of London, Masters Legal Costs Services LLP has been established for more than 20 years and has earned the reputation as one of the legal profession's leading costs consultancies. Acquisition International speaks to Philip Bowden, Costs Lawyer and Senior Partner at Masters Legal Costs Services LLP about recovering legal costs.

“We are one of the largest firms in the industry, with over 30 specialist fee-earners working from our offices in Bishopsgate. We are able to apply appropriate resources to all instructions that we receive and therefore provide an expeditious service. Many costs firms are under-resourced and plagued by delays. This also enables us to provide a bespoke service, adapting to meet our client’s needs.

“We provide a bespoke costs consultancy service. We act primarily in litigation but are instructed wherever a dispute exists regarding the quantification of legal costs. This includes costs between the parties in litigation; disputes with solicitors regarding fees invoiced; costs budgeting and estimates and expert evidence.

“The standard of our service and quality of our work is second to none.

We are fortunate not to need to widely advertise our services, relying instead on our reputation and the quality of our services.”

The Cost of Justice

“The costs of commercial litigation are increasing, the market is changing rapidly with personal injury costs giving way to fixed fees and the recovery of success fees and ATE premiums will shortly be abandoned.

“These reforms will cause economic pressures for those costs draftsmen who currently specialise in these areas (not necessarily ourselves) and will lead to unqualified and inexperienced cost professionals attempting to move into areas where they are ill-equipped to practise.

“Specialist and established firms such as ourselves will have to continue to prove ourselves to remain a level above our competition.”

“We have noticed both in this recession and the last that economic hard times lead to an explosion in litigation. This inevitably means that there are more costs matters that require specialist input. In the current climate commercial disputes are prevalent and this, combined with the increase in costs management and budgeting services, has ensured our growth has continued unabridged.

“In harder times, legal service purchasers, such as insurers, tend to take a closer look at the costs that they are paying. This has resulted in an increase in the cost audits we are instructed to undertake.”

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How do legal costs in the UK compare with those in other developed nations?

“Legal costs raise similar issues and problems across jurisdictions despite different approaches being adopted in different countries. Most former Commonwealth countries have a similar system to the UK. The US system is very different but we have provided expert evidence in the US, as well as undertaking costs audits in America and acted in cases in the Bahamas, British Virgin islands, Jersey, Guernsey as well as in the European Courts.”

Has the increasing popularity of “conditional fee” arrangements in the UK had any impact on cost analysis?

“Most certainly, conditional fee funding, particularly in relation to the enforceability of such agreements and the amount of success fees and ATE insurance has proved hugely contentious.

“Advice in relation to conditional fee arrangements requires a good understanding of the relevant case law and regulations. The debate regarding these type so funding arrangements continues with the Jackson reforms and further changes are imminent.”

What are your predictions for future developments in law costs in the UK? “In the light of the recommendations contained within the Jackson Report, it is inevitable that the recovery of additional liabilities (success fees and ATE premiums) between the parties will be abolished.

“It is also likely that the fixed costs regime will be expanded to cover most Personal Injury litigation.

“A number of pilot schemes are being run up and down England where costs budgets are prepared and approved as claims proceed. We anticipate the importance of costs and accurate costs management in commercial and large scale litigation will continue.”

On a lighter note, what’s the best piece of advice ever given to you (and put into practice!)?

“To succeed, your advice and services must not only be invaluable ... but also affordable.”

Philip Bowden Email: philipbowden@masters-legal.co.uk Web: www.masters-legal.co.uk Address: 3-4 New Street London EC2M 4HD Telephone: 0207 -929 4344

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The Cost of Justice

The Cost of

Justice

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Sally Dunscombe Email: sallydunscombe@justcosts.com Web: www.justcosts.com Address: Central Court, 25 Southampton Buildings, LONDON WC2a 1AL Telephone: +44 (0)207 758 2155

egal costs are complicated and many solicitors will, at some point in their career, require specialist help and advice from a law costs draftsman. The preparation of Bills of Costs, attendance at assessment proceedings and costs negotiations are under constant and rapid change, and dealing with them has become a complex procedure.

Acquisition International speaks to Sally Dunscombe, Manager of Just Costs Solicitors in London, about the cost of justice.

any recession-induced change in demand.

We are increasingly seeing Commercial Litigation running under Conditional Fee Agreements (CFAs), whereby the instructing firm does not have to pay their Solicitors fees should their case be unsuccessful. CFAs and their close relation, Discount CFAs, are useful tools for both Solicitors and their Clients. They also demand effective costs consultancy and advice, which is where Just Costs Solicitors come in.

Just Costs Solicitors differ from many costs firms because not only are they a Solicitors practice themselves but their client base extends beyond Solicitors to include Finance Directors, Counsel, Insurers and 3rd Party Funders.

“The changes to the courts’ management of costs are also creating the need for more accurate Budgets and regular Estimates, which certainly require specialist advice.”

The firm deals across the spectrum of cases from simple breach of contract up to the £35m of costs arising from the Buncefield Oil Refinery explosion, and everything in between. Their specialist Advocacy team can also attend any adversarial arena from County Court to the House of Lords.

“With clear leadership, state-of-the-art IT infrastructure, and consistent delivery, Just Costs Solicitors has shown itself to be an excellent partner to all involved in the practice of Commercial Litigation.

“We have strong links with the Commercial Litigation Association (CLAN) and our technical staff are regularly invited to speak at key industry events.

“We provide CPD-accredited training for Solicitors, to enable them to maximise their clients’ costs recovery, or minimise their exposure to adverse costs. “ Have you noticed an increase in demand for law cost draftsmen since the start of the economic downturn?

“We’ve certainly seen a huge demand for our services, but that may be more a reflection of our growing reputation than

How do legal costs in the UK compare with those in other developed nations?

There are a whole range of different Legal Costs systems around the world, though the Law in England and Wales is typical of common law jurisdictions where costs follow the event (so that the successful party to litigation is entitled to seek an order that the unsuccessful party pay their costs).

This differs from the USA where legal fees may be sought only if the parties agree by contract before the litigation, or if specific rules apply - some people suggest that this rule contributes to making America a more litigious society as individuals have little to lose beyond filing fees and a retainer to start a lawsuit…

Conversely, the English approach potentially hinders access to justice by increasing the financial risks of litigation. A different system is in place in Germany, which allows for fixed recoverable costs.

Has the increasing popularity of “conditional fee” arrangements in the UK had any impact on cost analysis?

Yes, its has had a massive impact, because when clients enter into a CFA they are technically liable for their costs, although they don’t expect to ultimately

pay them as they either expect the losing party to pay their costs for them or insure against adverse costs orders. What this means is there is something of a disconnect between the client and the charges that their Solicitors accrue – Therefore the Client does not act as a ‘natural filter’ on these fees.

We therefore see more paying parties complaining about excessive charges and fighting them in court. Its one of the reasons that Costs is such a litigious area of law.

What are your predictions for future developments in law costs in the UK? “There are currently a number of factors that will influence this field – The Jackson and the Lord Young reports are seeking to overhaul the system of Legal Costs and their impact on Access to Justice. – these will push through important legal changes that will impact a whole swathe of the industry.

“The introduction of Alternative Business Structures (ABS) in October 2011 will see huge upheaval in the legal industry – With many new entrants into the industry and more inventive approaches to the funding of litigation.

“Clients are also becoming more interested in how litigation is funded, and the courts about how costs are managed.

“In summary this means that Legal Costs is becoming much less of an after the event area of law and much more an integral part of the whole process that needs to be considered at (and prior to) the first instruction of the Solicitor, and ongoing throughout.

“Firms like Just Costs that offer full consultancy services to both Solicitors and Clients and are regulated by the SRA will undoubtedly benefit from this, at the expense of unregulated entities and those with narrower skill sets.”

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The Cost of Justice Robert G Connelly

14 Grosvenor Crescent, London SW1X 7EE Tel: +44(0)20 7235 8000 Email: info@childandchild.co.uk

79 Knightsbridge, London SW1X 7RB Tel: +44(0)20 7235 1288 Email: info@childandchild.co.uk Web: www.childandchild.co.uk Established in 1850, Child & Child continued success is based on an unsurpassed loyalty and integrity to their clients, both old and new. Acquisition International speaks to Robert Connelly FC , Costs Lawyer at Child& Child about the true “ cost of justice”.

What type of legal costs do you deal with; costs between parties, or costs charged by practitioners to their clients?

“I deal Civil/Commercial Contentious Costs and disputes concerning costs charged as between solicitor and client.”

Who is a typical client?

“We have both corporate and private clients however a typical client is an individual who thinks he has been overcharged by his solicitors but does not know how to go about challenging the bill.”

How do your services compare with other law costs specialists? How do you compete in an active market?

“We offer both a bespoke and holistic costs service as an integral component of our dispute resolution team. Robert conducts mainstream litigation in addition to costs litigation. He has first hand knowledge of how litigation is conducted and how costs are

generated both necessarily and unnecessarily in the pursuit/defence of claims. Robert brings his 38 years litigation experience to bear upon all new instructions. He offers a bespoke high quality service to his clients without delegation of instructions to others.”

Have you noticed an increase in demand for law cost draftsmen since the start of the economic downturn? Also has the type of demand changed any?

“The skills offered by Costs Lawyers have been in great demand since the economic downturn due to the need to make costs savings both before and during the conduct of litigation and an increased demand for alternative funding methods such a no win no fee and third party funding.”

How do you keep up with changes in legal costs and advances in the field to ensure your clients get the most accurate information? How is this information passed on to your clients?

“Robert follows both SRA and ACL CPD guidelines, researches at the Squire Law library Cambridge and writes feature articles for the Legal Executive journal having been interviewed for their April 2011 edition.”

Malcolm Goodwin FCL Costs Lawyer

134-136 High Street, Epping Essex CM16 4AG C O S T

C O N T R O L

Goodwin Malatesta Cost Control Ltd provide a specialist service to businesses who demand expert advice on legal costs in the same way they receive advice on other legal matters.

Malcolm Goodwin is a Costs Lawyer and director of Goodwin Malatesta Cost Control Ltd. “Our aim is to ensure our clients receive value for money from their legal spend” “Our existing clients are largely government and defendant organisations in civil litigation; however the government is proposing far reaching reforms to civil litigation funding and costs management that will have serious consequences to all parties involved in civil litigation in England and Wales.

“I deal with all aspects of legal costs including conducting legal costs proceedings and providing advocacy at detailed assessment hearings. For many years a large proportion of my work has involved reducing the costs to be paid to opponents in unsuccessful civil actions.

“However more recently businesses have been turning to me and my colleague Dom Malatesta to advise directly on the recovery or payment of costs in civil litigation and to advise on the fees being charged by their own solicitors.”

Tel: +44 (0) 1992 579 258 Email: mgoodwin@gmcostcontrol.com Web: www.gmcostcontrol.com

How do you keep up with changes in legal costs and advances in the field to ensure your clients get the most accurate information?

“This has been the most active time of change in legal costs since the introduction of the Civil Procedure Rules. There are constant changes to case law, judicial pilot schemes; government reviews and draft primary legislation. As a Fellow member of the Association of Costs Lawyers I receive regular legal updates and my firm subscribes to various legal publications and online resources. Important news is sent to our clients via e-mails; briefing notes and updates on our website. We also provide in-house seminars to our clients on key issues.”

What are your predictions for future developments in law costs in the UK? “I expect over time most of the government’s reforms to be implemented. We should soon see fixed recoverable costs on all personal injury claims under £25,000.00 and probably then increased to £50,000.00 with the extension of costs budgeting to many forms of civil litigation. Further down the line I expect the recovery of success fees and ATE insurance premiums from losing opponents to end and qualified one way fee shifting to be introduced. All these changes will place added demands on lawyers to work effectively, efficiently and within budget”

David Cooper

Legal Executive & Partner

Midgate House, Midgate, Peterborough, PE3 8QH

Tel: 01733 333333 Email: david.cooper@taylor-rose.co.uk Web: www.taylor-rose.co.uk Taylor Rose Law is a firm of solicitors which prides itself on offering an outstanding service whilst making the law accessible. David Cooper, Legal Executive and Partner with Taylor Rose Law LLP. Taylor Rose advise and assist in relation to any legal costs disputes, including costs between the parties and solicitor and own client costs. Predominantly dealing with costs payable by the paying party but includes preparation of bills of costs where costs entitlement arises.

The principal client base is various established insurance companies, but in addition assistance is provided to other solicitors and private clients.

How do your services compare with other law costs specialists?

“With the advantage of resources and experienced personnel, it is possible to provide a full range of services in relation to legal costs disputes. One of the most important elements of our service is the accumulation of statistical data in relation to costs claims and particular constituents of those claims. This has proved to be invaluable to the insurance industry clients and has proved to be of assistance to the Ministry of Justice and the Association of British Insurers in particular.”

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Have you noticed an increase in demand for law cost draftsmen since the start of the economic downturn? Also has the type of demand changed any?

“Demand for services of legal costs consultants and draftsmen in the business and private sector remains buoyant, despite the economic downturn. There is a greater emphasis on attempts to save money which includes reducing liability for payment of legal costs.”

How do you keep up with changes in legal costs and advances in the field to ensure your clients get the most accurate information? How is this information passed on to your clients?

“We have established a team who regularly consider newly published reports and articles relevant to costs law. David Cooper is a costs lawyer and a member of the Association of Costs Lawyers which does publish a regular updating magazine ‘Costs Lawyer’. Various other periodicals are considered as necessary in addition to the many law reports published. Any particular interesting developments within costs law are conveyed expediently to existing clients, predominantly by way of electronic communication. Information is also published on the firm’s website.”

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The Cost of Justice Jim Knight (Costs Lawyer) Director

10 Hillcrest View, Basildon, Essex SS16 4QU DX 53004 Basildon Costs Lawyer Network Limited is run by three Directors with more than 75 years worth of experience between them in dealing with all aspects of legal costs, including many high profile, high value cases. As qualified Costs Lawyers, the Directors happily rely on repeat business and recommendations. Jim Knight is a Director at Costs Lawyer Network Limited.

Have you noticed an increase in demand for law cost draftsmen since the start of the economic downturn?

“Following the recent economic down turn there is now a tendency for more legal disputes particularly as a result of mortgage repossessions and professional negligence claims. As a result there is a steady demand for the services of experienced and qualified Costs Lawyers.”

What are the biggest challenges facing cost lawyers? How do you overcome them?

“The “Jackson” reforms, once finalised, will provide Costs Lawyers with a new set of challenges. However, there will also be opportunities for those Costs Lawyers who are willing and able to embrace the changes proposed; for example Costs Budgeting and Costs Management will be a requirement in most litigated cases.

“Accordingly, Costs Lawyers must be fully familiar with the proposed changes even before they are implemented and they must also be flexible with regard to the type of services they are able to offer in the future. “ How do legal costs in the UK compare with those in other developed nations?

“Consideration was given by Lord Justice Jackson”, amongst other members of the judiciary, to the costs regimes in other countries and the introduction of fixed costs and contingent fees form part of the major changes anticipated.

Tel: 01268 550 448 Email: jim.knight@costslawyernetwork.com Web: www.costslawyernetwork.com

Gary Knight, Costs Lawyer Director

2 Emblems, Dunmow, Essex CM6 2AG DX 89806 Great Dunmow

Tel: 01371 879 930 Email:gary.knight@costslawyernetwork.com Web: www.costslawyernetwork.com

Mathew Knight (Costs Lawyer) Director

37 Magnaville Road, Bishop’s Stortford, Herts CM23 4 DN

Tel: 01279 758 427 Email: mat.knight@costslawyernetwork.com Web: www.costslawyernetwork.com “Having said that, fixed costs are nothing new and many in the legal profession will remember the scales of costs that were in place both in the RCJ and the County Courts long before the introduction of the Civil Procedure Rules.”

What are your predictions for future developments in law costs in the UK? “In future there will be more emphasis on Case Management with the early exchange of costs information between the parties, the preparation of costs budgets at the outset and the updating of budgets at key stages throughout the case; there may also be a slow but steady acceptance of Contingent fees with solicitors recovering a percentage of the Client’s damages – this is already in place in the Employment Tribunal.”

Fred Robbins, Angela McCombe Russell, Paul McCarthy Directors

Suite 4B, Blackfriars House, The Parsonage, Manchester, M3 2JA

Tel: 0161 836 6842 Email: paul@soscosts.co.uk Web: www.soscosts.co.uk SOS Costs (UK) Ltd offer a complete service, conducting the entirety of any costs litigation against a solicitor. The firm have rights of audience to represent their clients in Court (including the Senior Court Costs Office) in the conduct of detailed assessment proceedings. SOS Costs (UK) Ltd provide advice throughout and ensures that you are kept fully up to date with all developments. Fred Robbins is a Director at SOS Costs (UK) Ltd. “SOS Costs (UK) Ltd is the only firm to specialise purely in solicitor/ own client costs.

We offer a high quality service based on substantial experience of solicitor/ own client costs. We are able to offer the client a wide range of fee options including hourly rates, fixed fees and ‘no win no fee’ agreements.”

What are the biggest challenges facing costs lawyers? How do you overcome them?

“Working with a client and their chosen solicitor to ensure that both parties understand what is required of them and then to monitor the client care throughout the case and therefore avoid costly and time consuming assessments. To reach this goal we need the practitioners to see us as an asset. This is undertaken by educating practitioners

that if the client is happy then they can concentrate on the job in hand knowing that there will be no issue on their fees.”

How do legal costs in the UK compare with those in other developed nations?

“Many countries have a fixed costs regime but not many countries have the facilities we have in the UK for checks and regulation of professionals’ fees.”

Has the increasing popularity of “conditional fee” arrangements in the UK had any impact on cost analysis?

“Costs have generally increased and analysing what a reasonable level of costs is has become more difficult due to the uncertainties and lack of guidance surrounding the level of success fees.”

What are your predictions for future developments in law costs in the UK? “An increase in the scope of the fixed costs provisions in Part 45 to cover a greater range of litigation.”

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International Movers & Corporate Relocation International Movers & Corporate Relocation

On the move…

When working in the corporate world, especially over a certain salary range, the likelihood that an organization will desire for you to relocate to fill a position increases. In a day and age where country borders do not form borders to business and the world is our corporate boardroom, it is necessary to be prepared for the possibility of relocation. Preparation means being armed with all the facts you should know about relocation and what is involved so you'll know when the question arises whether or not it is something you want to encounter. Acquisition International speaks to Karelia Scott, Director at Daniels of Manse & Garret Property Search, who has been offering corporate relocation services since 2007.

When working in the corporate world, especially over a certain salary range, the likelihood that an organization will desire for you to relocate to fill a position increases. In a day and age where country borders do not form borders to business and the world is our corporate boardroom, it is necessary to be prepared for the possibility of relocation. Preparation means being armed with all the facts you should know about relocation and what is involved so you'll know when the question arises whether or not it is something you want to encounter. Acquisition International speaks to Karelia Scott, Director at Daniels of Manse & Garret Property Search, who has been offering corporate relocation services since 2007.

Manse & Garret Property Search’s typical client is a family with children, often with quite specific lifestyle requirements which need to be met. The firm has a qualified school inspector who can conduct school and nursery searches for children, and spouse settlement is de rigeur.

“The rationale behind buying property off was not only to get the right property but also to ensure our clients don’t pay an Estate Agent’s inflated opinion of what the property is worth.

“Many of our clients are from Western Europe or North America, and they have usually been asked to relocate to London for work.

“By outsourcing relocation needs to us your employees lifestyle preferences and work commitments are taken seriously when looking for the right home. Capitalising on our close relationships with estate agents and letting agents and residents, including those off the beaten track we leave no stone unturned in the search for our clients’ new home.

“We also don’t just rely on what Estate Agents and Lettings Agents happen to have on their books at the time, we consider all properties in the area and will make direct approaches to the owners of suitable properties to ensure that we find the best property for our Client.

Some Buyers Agents say that you have to pay extra to do this, but we have been buying property directly, off-market since the seventies and doing so very successfully.

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Karelia Scott – Director Email: hello@manseandgarret.com Web: www.manseandgarretproperty.com Address: 18b Charles Street, Mayfair, London W1J 5DU. Telephone: +44 20 7923 7564

“At Manse & Garrat we are incentivised to save our Clients money so searches through us are almost always self-funding, ie we usually save our Clients a great deal more than our fees. For example one of our Clients who moved into their home which we sourced directly less than a year ago, has already had unsolicited offers for in excess of what we negotiated for them. I believe this really demonstrates of how much we really understand the property market, and are able to deliver real value for money to clients who are buying or renting a home. Every potential purchase or rental is thoroughly researched and we will always negotiate the best deal for our clients.”

Home and away…

“In terms of professional and financial services, London remains an important international centre partly because employees want to come here because London is the most exciting city in Europe, buzzing and sociable, with great restaurants and theatres, but also family friendly with excellent parks and schools. With superb transport links into London, the Home Counties are attractive to those who want more space for their money, a garden, tennis courts, swimming pool and equestrian facilities perhaps.

“London is such a vibrant employment zone that there will always be people relocating to the capital for work. The speed of the lettings market and the shortage of supply mean that it is necessary to have someone on the ground, in constant touch with the market in order to secure the right home at the right price.

“As the shortage of good quality property decreases, employing Manse & Garret with our focus on off-market property is even more important than ever when it comes to finding the perfect property.”

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Corporate Tax Matters “

Corporate Tax Matters

The new Portuguese rules on the taxation of dividends, besides taxing all dividends stemming from shareholdings of less than 10%, brought uncertainty in submitting the application of the dividends received deduction to the requisite of “effective taxation” without clarifying the concept.

T

”

he new Portuguese rules on the taxation of dividends, besides taxing all dividends stemming from shareholdings of less than 10%, brought uncertainty in submitting the application of the dividends received deduction to the requisite of “effective taxation” without clarifying the concept

As far as EU shareholders are concerned, the CIT (corporate income tax) exemption applicable to dividends distributed by Portuguese entities to EU resident entities meeting the EU Parent-Subsidiary Directive only becomes available when the parent company has owned, at least, 10% of the Portuguese company, for at least one year uninterruptedly prior to the date on which the dividends are payable (previously the exemption would apply whenever the beneficiary held less than 10% but the acquisition cost amounted to at least Eur. 20 million).

On the other hand, and at a domestic level, the dividend received deduction rule that aims to prevent double taxation now only applies whenever (i) the recipient company holds, for at least one year, a stake of not less than 10% of the share capital of the subsidiary (previously the exemption was also available where the recipient held a stake with an acquisition cost of at least Eur. 20 million), and (ii) the profits from which such dividends arise have been previously subject to effective taxation.

Besides taxing all dividends stemming from shareholdings of less than 10%, the inclusion of the “effective taxation” requirement without clarifying it has also brought uncertainty to the system where the dividend payee has benefited from the dividend received deduction rule. This may be particularly relevant in the case of dividends distributed along a chain of participations.

Still within this context, it should be highlighted the fact that the new regime has been amended in the sense that now there is only a tax regime applicable to dividends, regardless of whether the beneficiaries are mixed holding companies, or pure holding companies - “SGPS companies” (pure holdings benefited from a waiver in relation to the percentage needed for eliminating the double taxation of dividends distributed to them).

Finally, and for the purposes of applying the tax group special regime, dividends that would not benefit from total elimination of double taxation distributed among the companies that comprise the group perimeter may no longer be disregarded when calculating the group’s consolidated taxable profits.

JOÃO MAGALHÃES RAMALHO

CRAIG MILLER

Lawyer

Director, Business Tax Advisory

Tel: + 351 21 319 74 61 Mob: + 351 93 259 55 99 Fax: + 351 21 319 74 50 Email: joaomagalhaes.ramalho@plmj.pt Web: www.plmj.com

Tel : +27 (0)11 502 0749 Mob: +27 (0)83 293 1455 Fax : +27 (0)11 772 5925 Email: craig.miller@za.ey.com Web: www.ey.com

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Corporate tax in the Libya “ ” Corporate Tax Matters

Abdalla Hamed

Tel: +218 21 335 1246/7 and +218 91 381 2004

Email: abdalla@consultancy-house.com Website: www.consultancy-house.com

Address: 57-58-59 Al Fatah Tower, First floor, Tripoli, Libya

This new law has reduced number of taxes. For example for corporation tax system now is 20% flat rate, the previous tax rate can reach up to 40%. Another example is for contract stamping is 1% down from 2%.

Acquisition International speaks to Dr.Abdalla Hamed, chartered accountant and General Manager of Consultancy House, a consultation company provides financial services and consultations in Libya and overseas about why “Corporate Tax Matters” in Libya.

Dr. Abdalla is a chartered accountant, he is a General Manager of Consultancy House, a consultation company provides financial services and consultations in Libya and overseas. He was a lecturer at university of Wales, Cardiff, UK between 2004-2008, a consultant for number of International companies in Libya and overseas. Also he has number of publications in international conferences in the area of Taxation, e-commerce, economic development, Investment opportunities in Libya and emerging markets entries. And a speaker for number of international events related to tax, investment and business opportunities.

Consultancy House (CH) was formed in 2006, when the Ministry of finance allowed the establishment of financial companies in Libya.

CH provides financial services for firms (especially international firms) in Libya, including accounting, auditing, payroll, taxation, market entry and consultations. CH employees are over 30 employees from different nationalities which makes CH a multi-cultural organization. CH Libya is in Tripoli and Bengazi; also CH has overseas branches in Cairo, Kuala Lambour and London.

Can you give an example of your typical client i.e. large/medium sized firms?

CH clients are from different nationalities, different sizes and different areas of specialties,

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including firms from Italy, UK, Hungary, Bosnia, Croatia, Germany, , Turkey, Pakistan, India Malaysia, Singapore, China and Australia.

CH clients are in fields of Constructions, telecommunications, Health, technology solutions, general trade, and oil services.

Dr.Abdalla Hamed how does your firm stand out from local competitors in terms of the services you offer?

“Consultancy House provide a number of services which make it difficult to position the company in the market. However, for services such as accounting, payroll services and taxation, we are one of the best firms in the market (if not the best) and one of the top 10 working firms offering auditing services.”

mistakes that are made the auditor will be partly responsible with the company.”

Has there been any recent change in tax legislation that you would like to discuss?

“The tax law in Libya was changed recently; this new law has brought number of changes to the national and international companies who are working in Libya.

“This new law has reduced number of taxes.

For example for corporation tax system now is 20% flat rate, the previous tax rate can reach up to 40%. Another example is for contract stamping is 1% down from 2%.

What are the tax benefits in Libya?

“Libyan tax system does not provide any benefits for international companies working in Libya, unless these companies are registered under Investment law number (9). Registering under this law creates a 5 year tax free period, which is sometimes extended to 10 years. The income of these companies can also be reinvested on a tax free basis.”

“Also, after the recent political issues, the Libyan current government are talking about a new tax law to be introduced once the government over come such problem. If so, the new law may provide more benefits to increase international investor and remove barriers as well as may introduce online solutions such as tax filling and tax submission. On the other hand, otherwise, a new developed tax law will be introduced to the market.”

What does a corporate tax adviser bring to the deal table?

“A Corporate tax advisor can help international companies in many ways, as the tax office does calculate their income tax from the NET income which is formulated from the companies’ financial statement, which is audited by the Libyan auditor. Therefore, the auditing firm experience and reputation will play a key role of convincing the examiner to accept the financial statement; otherwise, the examiner would have to examine company's documents, wasting the company’s time and resources. Additionally, any

What are your predictions for future developments in corporate tax practice in Libya?

“The Tax authority is currently working on introducing a number of new developments for tax system in Libya. These changes were proposed by number of national and international companies including Consultancy House. The new system suggested including online submission system for tax payer, and tax calculation system for companies. Also, number of benefits such as advance payment discounts should be offered.”

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Corporate Tax Matters Ramón Máynez C. Partner

Periférico Sur 4293 1st Floor.

Tel: +52 (55) 5481-5370 Email: rmaynez@bakertillymexico.com Web: www.bakertillymexico.com Baker Tilly México is a Mexican Firm with over 1,600 employees and over 56 partners which is part of an international network with presence in 120 countries

generating a fee income of £190 million which positions us as one of the leading midtier accountancy firms.

In México, services are divided by specialized areas as follows:

Emilio Altamirano S – Federal Taxes Julio C. Aragón C – Transfer Prices Rubén Federico G – Federal Taxes Federico Garza T – Litigation

by Secretaría de Hacienda y Crédito Público (SHCP), a kind of Treasury Department and is administrated by the Servicio de Administración Tributaria (SAT), a kind of IRS.” Have there been any recent changes in tax legislation?

“Recent changes (2008) include a double calculation for corporate taxes; income tax on accrual basis and the

flat rate tax on cash basis. Corporate have to pay the higher of both calculations. Detailed information and tax returns to be filed at the tax authorities every month. They have also been excessive requirements for tax deductions and tax vouchers.”

Edgar Mendoza Ch – Foreign Trade

Can you please highlight the main challenges you face on a day to day basis when working on a

Federal Taxes include among others specialization in Income tax, Flat rate tax, Value added tax, Production and

“We have to review tax laws, regulations and treaties to avoid double taxation to assure we are providing the

Services Tax for industrial and commercial corporations. Rubén Federico G. establishes:

“Our tax services include a wide range such as tax advice, tax planning, tax compilation, transfer pricing, foreign

commerce, social security advice, mergers & acquisitions, etc. We offer personalized services to clients, which is key strength of Baker Tilly, Mexico.”

In your jurisdiction what code of rules must you adhere to? Who regulates them?

“There is a Federal Fiscal Code and specific federal tax laws, as well as local tax laws. Federal taxes are regulated

cross border deal?

best advice to our clients. Concepts such as royalties, technical assistance, entrepreneurial benefits, interests, dividends, etc. Are not always well defined in such documents.”

What are your predictions for future developments in corporate tax practice in your jurisdiction?

“Increase of taxation through indirect taxes such as value added tax and simplification of direct corporate

taxes such as income tax including reduction of exemptions to increase tax collection.”

Richard R. Lapres Tax Partner

5th Floor Salamin Building, 197 Salcedo St., Legaspi Village, Makati City

Richard R. Lapres is Tax Partner, Manabat Delgado Amper & Co., the only Philippine member firm of Deloitte Touché Tohmatsu Limited.

“The majority of our clients are referred in by the Deloitte network and most of them are large multinationals firms operating in several countries.”

How does your firm stand out from local competitors in terms of the services you offer?

“The availability of the engagement team to our clients to address pressing issues and concerns, coupled with the ability to tap resources and expertise within Southeast Asia to meet client needs. I guess being recognized by the International Tax Review Asia Awards as the Philippines Tax Firm of the Year for 2009 and 2010 acknowledged our efforts to serve our clients.”

What are the tax pitfalls a company must be aware of in the Philippines?

“Investors should be aware of the restrictions and limitations on the participation of foreign equity in certain industries and business activities. Long term investment/business strategy should also be considered in choosing the entity and the tax and fiscal incentives to avail. Be it a foreign branch, subsidiary, regional headquarters, regional operating headquarters, joint venture, etc. has its advantages and disadvantages.

“Payments for royalty, interest and dividends to a non-resident foreign individual or entity is

Tel: +63 2 581 9044 Email: rlapres@deloitte.com Web: www.deloitte.com/ph

subject to a lower withholding tax rate if the domicile of the non-resident has an existing tax treaty with the Philippines. However, before such lower rate is applied it is also necessary to obtain a ruling from the tax authorities’ c0nfirming the application of the lower rate under the tax treaty provisions applicable. “ What does a corporate tax adviser bring to the deal table?

“In line with the client’s investment strategy in the Philippines the corporate tax adviser usually provides the pros and cons (tax implications) of alternative investment entities taking also in consideration the tax implications on the remittance of dividends, interest, royalties, disposal of shares or other payments outside the Philippines. A Deloitte tax adviser usually does not operate in isolation with regards to clients with multi-country entities. He can consult other Deloitte tax advisers when it comes to other taxing jurisdictions. That’s the advantage of a global network of tax advisers.

“We have one client that is investing in the Philippines by putting up a manufacturing plant in a special economic zone and enjoying tax incentives like income tax holiday and other fiscal incentives. Before the actual set-up 0f the plant they consulted as on various types of entities to be set-up and its advantages and disadvantages vis-a-vis the investment vehicles they setup in several European countries. So, the Deloitte network of tax advisers became very helpful in giving the client an overall tax picture and implication of the plant in the Philippines in relation to other investment entities in Europe.”

Prof. Dr. Alexander Hemmelrath Member of the Executive Board

Thomas-Wimmer-Ring 1, 80539 Munich, Germany

Tel: +49 89 28646 0 Email: alexander.hemmelrath@wts.de Web: www.wts.de Prof. Dr. iur. Alexander Hemmelrath, Dipl.-Kaufmann, Tax Accountant and Certified Public Accountant, is member of the executive board of WTS Group Aktiengesellschaft and acts as managing director of WTS Hemmelrath GmbH. WTS is a rapidly expanding tax consultancy headquartered in Munich, and with further representation in Germany and elsewhere.

What does a corporate tax adviser bring to the deal table?

“For any kind of acquisition, it is crucial to evaluate its tax consequences as they can have a severe impact for the vendor as well as the buyer. This applies, among others, for tax areas as loss carry forward, VAT and real estate transfer tax. It would therefore be highly negligent to not involve a corporate tax adviser in the negotiation process.”

WTS's consulting activities focus on the area of national and international corporate tax law. In addition to ongoing tax consulting and training services, the focus lies in particular on transaction support, global financial services, and advising companies and groups on transfer pricing, VAT and customs issues.

What are your predictions for future developments in corporate tax practice in your jurisdiction?

“In the future the international context will become even more important. Cross border transactions must be made easier while at the same time states will try to protect their right to tax. Both issues will be reflected in states' legislation.”

WTS's clients include mid-sized and large international companies in Germany and elsewhere including their global subsidiaries.

What are the tax pitfalls a company must be aware of in Germany?

“Over recent years, legislation on the issue of loss off-setting has become more and more restrictive. A recently introduced provision which results in the loss of all loss carry forward in case of a transfer of more than 50 % of shares in a corporation - even within a corporate group - can pose a serious obstacle for any acquisition.”

“For any kind of acquisition, it is crucial to evaluate its tax consequences as they can have a severe impact for the vendor as well as the buyer. This applies, among others, for tax areas as loss carry forward, VAT and real estate transfer tax. It would therefore be highly negligent to not involve a corporate tax adviser in the negotiation process.”

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Corporste Tax Matters Bilgütay Yaşar Tax Partner

S.Seba Cad. BJK Plaza No:48 B Blok Kat:9 Akaretler stanbul Tel: +90 212 3266414 Email: bilgutay.yasar@tr.pwc.com Web: www.pwc.com.tr

PwC Turkey has a very strong and experienced M&A team that advises large to medium sized firms.

Bilgutay Yasar is a tax partner and he has advised on tax matters on huge number of deals, to both seller and buy side.

“Tax incentives in Turkey exist depending on the size, industry and region of the investment. There are special incentives for R&D activities.

What does a corporate tax adviser bring to the deal table?

“The main benefit of the tax advisor would be to help the investor to make an informed decision. In addition, tax costs associated to the deal could be reduced. For example Historical tax liabilities of the target company is a major tax pitfall in Turkey and should be examined before the transaction.

Has there been any recent change in tax legislation that you would like to discuss?

“The tax amnesty recently eanacted poses an opportunity for M&A players in Turkey.

In Turkey the accounts remain open for a tax audit for 5 years. With the tax amnesty,

it is possible for taxpayers to get relief from tax audit by way of a voluntary increase in their tax declarations and payment of an incremental tax on the increased tax base.

This provides an important opportunity in the M&A market to be able to close the deals that have been previously called off due to historical tax exposures.”

Cross border deals tend to be more problematic that traditional domestic transactions; can you please highlight the main challenges you face on a day to day basis when working on a cross border deal?

“In cross border deals you have to take into consideration the impact of the tax regime applicable in the related foreign jurisdictions, as well as the restrictions stemming from the domestic legislation. This makes the cross border deals more complicated that traditional domestic transactions.”

“Tax incentives in Turkey exist depending on the size, industry and region of the investment. There are special incentives for R&D activities.”

Khoonming Ho Tax Partner

Oriental Plaza, No. 1 East Chang An Ave., Beijing 100738, China

Tel: 86 10 8508 7082 Email: khoonming.ho@kpmg.com.cn Web: www.kpmg.com.cn KPMG China was the first international accounting firm to obtain a business license in China in 1992 making it the most experienced and longest established advisors to foreign investors in China. It has 13 offices located in major cities in China including Beijing, Shanghai, Guangzhou, Shenzhen and Chengdu.

Since 1993, Khoonming has been actively involved in advising foreign investors in respect of their investments and operations in China. He has experience in advising issues on investment and funding structures, repatriation and exit strategies, M&A and restructuring. Khoonming Ho is tax partner in charge of China and KPMG Hong Kong.

Khoonming has worked in different parts of China, including Beijing, Shanghai and southern China, and has built up strong relationship with tax officials at both local and state levels. Khoonming has also advised the Budgetary Affairs Committee under the National People's Congress of China on post-WTO tax reform. Khoonming is also actively participating in the government consultation project in respect of the forthcoming VAT Law. He is a frequent speaker at tax seminars and workshops for clients and the public, and an active contributor to thought leadership in tax issues.

How does your firm stand out from local competitors in terms of the services you offer?

“While technically excellent and possessing tremendous insight into China tax policies, KPMG China has a thorough understanding of business that goes beyond taxation.

This means that, in dealing with structuring issues and performing tax due diligence, KPMG China focuses on issues that are critical to businesses and provides technically and practically sound solutions. KPMG China's tax teams specialize in different industries including financial services, energy and natural resources, information technologies as well as private equity funds.”

What are the tax benefits in China?

“The Chinese government provides a raft of tax incentives for state-encouraged industries, including advanced technology, environment protection, energy and water conservation, infrastructure and agriculture.

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“Where the relevant conditions are met, it is possible to defer Corporate Income Tax on transfer of equity interests or assets. Also it is possible to avoid Value Added Tax and Business Tax on transfer of business as a going concern under certain circumstances.

“The Ministry of Commerce has recently issued an exposure draft on the regulations that allow foreign investors to acquire businesses through share swap. If the regulations are issued, foreign investors will have more flexibility in effecting M&A activities in China.”

What does a corporate tax adviser bring to the deal table?

“As there are certain grey areas in the Chinese tax regulations, it is important that tax advisors are not only familiar with the rules but also have insight on how they are applied in practice.

“The tax advisors also need to have good relationship with the tax authorities at both the central and local levels, so as to assist their clients in ascertaining the tax officials' views on the issues concerned and explaining their clients' situation to the tax officials.

“The tax advisors should also be able to leverage off their experience in past M&A projects in advising their clients. As China is a big country and has many local variations in the way tax regulations are interpreted and applied, it is important that the tax advisors have local or regional knowledge.”

“Since 1993, Khoonming has been actively involved in advising foreign investors in respect of their investments and operations in China. He has experience in advising issues on investment and funding structures, repatriation and exit strategies, M&A and restructuring. Khoonming Ho is tax partner in charge of China and KPMG Hong Kong.”

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Corporste Tax Matters

Corporate Tax Matters in The Netherlands…

“

Their clients include a wide variety of US and European based Multinationals for whom we undertake the international tax planning. This multinationals may be public or privately held.

DLA Piper specialises in corporate tax planning in relation to international M&A and capital market transactions (equity and debt issues), corporate restructurings, post merger integration and more generally international planning, including Advance Tax Ruling (ATR) practise and Advance Pricing Agreement (APA) practise. Acquisition International speaks to Roderik Bouwman is Tax partner and Head of EMEA Tax at DLA Piper’s Amsterdam offices about wht corporate tax matters Their clients include a wide variety of US and European based Multinationals for whom we undertake the international tax planning.

This multinationals may be public or privately held.

What are the tax pitfalls a company must be aware of in the Netherlands?

“Two sets of extensive and complex rules on interest expense deduction in relation to intra group loans can be considered as a pitfall.

Firstly, the Netherlands have thin capitalization rules in place with a 3:1 ratio or, as an alternative thereto, the so-called group ratio which needs to be observed. In principle, the thin capitalisation rules do not apply to third party loans. However the impact of security rights, such as parent or sister guarantees, issued in favour of a third party lender needs to be considered carefully as this will normally bring the third party loan within the scope of the thin capitalisation rules.

“In addition, there are anti base erosion rules. Pursuant to these rules, the deduction of interest can be denied on intra group loans that are used to fund three types of tainted transactions: 1) to fund a capital contribution, 2) to fund a dividend 3) to fund the acquisition of shares.

In particular this last mentioned limitation requires special attention in structuring an M&A transaction. Escapes are possible if business reasons can be demonstrated for both the financing and the tainted transaction and/or if the interest is taxed at a reasonable rate in the hand of the recipient. Generally speaking, if well-structured a Dutch company should be able though to successfully claim the interest deduction in its tax returns.

So what are the tax benefits?

“In general the Netherlands can be considered as a very taxfriendly environment for multinational companies and have a long tradition serving as the portal to Europe for non-European corporations. Compared to most of the other European countries the corporate income tax rate of 25% can be considered as beneficial. Further key tax benefits of the Dutch tax system are the participation exemption regime (providing a corporate tax

Roderik Bouwman

Address: Amstelveenseweg 638, 1081 JJ Amsterdam

Email: Roderik.Bouwman@dlapiper.com

”

Web: www.dlapiper.com

Tel: + 31 20 5419894

exemption for dividends and capital gains derived from qualifying shareholdings), the absence of interest and royalty withholding taxes, the large tax treaty network and the various EU tax directives, the possibility to obtain advance tax rulings and pricing agreements providing advance certainty on the Dutch tax consequences when making an investment in or through the Netherlands. The Netherlands also does not impose capital tax or stamp duties. As consequences thereof, it is often seen that Netherlands intermediate holding companies are used to facilitate the structuring of international M&A transactions.”

What does a corporate tax adviser bring to the deal table?

“The role of the corporate tax adviser is in fact a twofold one. First he/she assists in the tax due diligence and the drafting of the relevant tax provisions in the share or asset purchase agreement, relating to eg the share purchase price allocation among the various parts of the takeover target. Secondly the help of a corporate tax adviser is instrumental in structuring the envisaged M&A transaction, in particular the financing (debt) side thereof in the most tax efficient manner, also with an eye to the post acquisition integration process that normally immediately follows the acquisition. The push down of acquisition debt push is generally an important aspect of this integration process.”

What are your predictions for future developments in corporate tax practice in Netherlands?

“The Dutch corporate tax practise will continue to be effected by the developments in EU tax and case law. There are still provisions in Dutch tax law that are incompatible with the EU treaty. An example is the so-called substantial shareholding rules that may apply to non resident tax payers. The EU Commission requested the Netherlands to bring its in line with EU law. Also the Netherlands exit tax rules which are imposed when a Dutch company transfers its seat or assets to another EU Member State are held incompatible with the EU treaty by the European commission. Also the proposal from the EU Commission for a Council Directive on a Common Consolidated Corporate Tax Base (the ‘CCTB’) appears to gain momentum and may lead to a major evolution in respect of tax structuring in the EU.”

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International Corporate Debt Recovery

International Corporate Debt Recovery C

orportate debt is often complex and can cross international boundaries hence if a company’s credit control system is not effective and the pressure is on to recover payments, then it is often worth enlisting the help of a professional in the debt collection field. Acquisition International speaks to Mr Steve Kiely, Joint Managing Director at Charter Mercantile , a Global Outsourcing Company specialising in debt management, who has, alongside his business partner Simon Hunnisett has 35 years experience in International Debt Recovery.

“We commenced the Charter Mercantile operation in Australia in 1986, opened our United Kingdom operation in 1991, India in 2004, Thailand 2007 and are currently opening a collection hub in Kuala Lumpur to service collections into regions including Singapore, Hong Kong and Thailand.

“Today Charter Mercantile partners some of the world’s largest companies in their endeavour to maximise opportunity and become more cost efficient.

Such companies include international telecommunications companies; Global financial services companies along with Charge card and major international Banks.

“Our unique and proven onshore / offshore collections model differentiates us from our competitors and delivers consistently higher liquidation rates.

“We continually look for ways to ensure the service we provide to clients is in line with global trends regarding compliance, service delivery, quality, security and price.”

Have you been involved in any notable cases recently?

Our major collection activity is consumer orientated and we strive to eliminate complaints and remain compliant at all times with regulatory controls hence there are no notable cases that come to mind.

How are your services superior to those of your competitors?

“Working with our clients to achieve increased cash collections,

Twenty Eight

Steve Kiely

Email: skiely@chartermerc.com

Website: www.chartermerc.com

UK Address: Level 2, 89 Goldsworth Road, Woking Surrey GU21 6LJ. Tel: +44 (0)1483 729 100 AUS Address: Level 2, 54 Alexander Street, Crows Nest NSW 2065.

Tel: +61 (0) 412 255 902

customer communication and quality is what we do....Because we have a collection agent to compliance officer ratio of 5 to 1 we can ensure that quality from our staff is superior to that of our competitors through a more dedicated call monitoring and training process.

“Our philosophy is simple; we provide high quality solutions through the integration of leading edge technology, highly skilled and motivated staff and proven work flow practices.

“As one of the most reputable independent mercantile companies, we can guarantee ways to achieve greater efficiencies through the implementation of world’s best practice for our client’s organisation.”

As we slowly recover from the economic downturn, how will this effect the demand for your services in Australia?

“As consumer confidence returns to the market so will consumer spending increase alongside business activity. As this growth in activity increases so too will delinquency rise in terms of volume that will lead to an increased demand for our services.

“Additionally the benefits of outsourcing to a Global specialist such as Charter Mercantile can enhance a company’s business through the improvement in cash flow brought about by increased collections along with improved quality and compliance while at the same time reaping the benefits of a lower cost base that delivers this service.

This service can not only add value to consumer credit providers but also to SME’s that want to increase their contact rates with their customers in increasing collections whilst also upselling their product to them at the same time. We need to get them thinking a little differently about how they approach their business and how process changes are required to keep pace and ahead of National trends.”

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Capital flowing

Establishing and Managing Real Estate Funds

E

ven those who aren’t remotely interested in real estate are well versed about the troubles facing the industry as a direct result of the global economic recession; however, those very same people might be interested to learn that over the course of the last 2 years, the average real estate fund has soared 128%.

It certainly seems like capital is flowing back into the globe’s prime bricks and mortar. Acquisition International speaks to John Dunkerley, Managing Partner at Apache Capital Partners LLP about establishing and managing Real Estate Funds.

Apache Capital Partners LLP, headquartered in London and with an office in Bahrain, is a real estate investment management boutique established in 2008 to take advantage of the prevailing market dynamics in what we believe is a generational investment opportunity.

Founded by seasoned property investment professionals, who between them, have completed over £10bn of property transactions in the UK, Middle East & Europe and have, on average, 25 years experience in the sector.

Apache Capital manages niche real estate investment strategies, each with integrated investor discretion, which are designed for today’s marketplace whilst reflecting tomorrow’s profit. The clearly defined value added strategies provide investors with the ability to invest in a diversified UK property investment platform, on a property by property basis, combining mainstream and niche sectors, with the benefit of both capital growth and income returns.

Apache Capital's investment strategies are governed by a combination of the following three key principles 1) Macro Led Fundamentals 2) Non-Institutionalised Sectors or Investments 3)Value-Added Asset Management.

The firm has access to Circa £150m of equity, for existing strategies, with drawdown on an investment by investment basis

John, who is a typical client and explain how their demands have changed since the onset of the downturn?

“A typical Client is an Investment Bank or a Family office which requires a more tailored approach to property investing with integrated investor participation and ultimate discretion.

Most investors have been adversely affected by the downturn, with some real estate assets remaining below peak valuations and are naturally more cautious in their investment decisions. The primary structural change in their investment requirements is they no longer wish to invest into blind discretionary funds, preferring to invest on a deal by deal basis, whilst maintaining final discretion on whether or not to invest into an asset.

Investors increasingly recognise that there is an opportunity to invest into UK real estate, where we are now past the worst of the cycle, and can start to selectively take advantage of a modestly improving economy.

As a result of the past two years investors naturally wish to seek an attractive return for the cost of their capital and generally their return requirements are now higher than before. We believe that future returns will be driven, not from excessive leverage, risks or market yield compression, but from enhanced income streams, strong tenant covenants and organically driven capital growth through the implementation of asset management to reposition assets and enhance value. Real Estate investing is no longer a significant leveraged play.

These clients recognise that their target real estate returns, will be primarily driven by the expertise of the manager and therefore it is essential they have an excellent track record, align their interests through co-investment and can secure innovative investment opportunities discretely.

Transparent and efficient investor relations is essential and if you are working with overseas clients you need to have physical representation in that specific area. We therefore made the decision to relocate myself and family to set up and operate our office in Bahrain. Apache is quite unique in this respect, with few real estate managers offering access

to a founding partner on the ground. I have found investors appreciate that Apache have made a long term commitment to the region, and there is no substitute for us being able to service our clients face to face, it helps to build trust.”

Why do real estate funds and real estate investment trusts provide such attractive yields?

“Real Estate is an attractive asset class to invest in however historically (and no doubt in the future) it is cyclical and the returns derived from investing in it are cyclical. If you look at the last 40 years there have been various peaks and troughs. Yields derived from real estate tend be higher than those derived from equities and bonds as it is perceived to be slightly more risky and less liquid. Equities and Bonds can be sold in an instant; however it will usually take a month to two months to market and sell a property. Real Estate is also a good income generator and the income can be increased by using sensible amounts of leverage (50-60%.) There is currently a good yield arbitrage between average yields on property 6-7% and the Bank of England base rate 0.5%. Property has also historically been a good hedge against inflation, which is increasingly prevalent.

Apache Capital

Almoayyed Tower, Suite 2124, Seef District P.O. Box 30517, Budaiya, Kingdom of Bahrain Tel: +973 17567926 Fax: +973 17567901 Bahrain Mob: +973 39165462 UK Mob: +44 7725 563396 Email: jdunkerley@apachecapital.co.uk Website: www.apachecapitalpartners.co.uk

Gemma Bradley

201 Bishopsgate, London EC2M 3AE Tel: 020 7818 4441 Mob: 07944 334 069 Web: www.henderson.com/property

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Destination: Argentina

DESTINATION

rs & Merge ns itio is u q c A list Specia

Carlos Ratto Tel: +54911 4067 4597 Email: cratto@gtallp.com Web: www.gtallp.com Buenos Aires: Edificio Colonos Sur, Victoria Ocampo 360, piso 3 London: 42 Brook Street, W1K 5DB London, UK California: 964 Fifth Avenue, San Diego, California, 92101 United States

In 2010 Argentina saw an increased number of mergers and acquisitions compared with recent years, with the most significant transactions related to oil & gas, telecommunications and agribusiness. It seems that the high yield on the rate of returns offered by developing countries, have attracted the interest of Private equity funds and venture capital.

Although Argentina is far from being the busiest M&A destination in Latin America, recent investments have been big, showing that confidence is returning to the region and that business is starting to flow. Cross-border activity plays a major part of Argentine M&A with particular interest of late from the brics. Acquisition International speaks to the experts about M&A IN Argentina.

G

oldenhill are M&A Advisors specialising in mid-market cross border transactions. The firm’s main vertical specialization is technology, although they have done deals in others areas as well. With offices in London, San Diego and Buenos Aires, Goldenhill is an international firm that serves clients all over the world.

Acquisition International speaks to Carlos Ratto, a Partner at Goldenhill International M&A Advisors and who heads the Latin American practice, about M&A in Argentina.

Goldenhill have recently concluded the third acquisition for an AIM listed client that they have worked with for over two years now. This is a prime example of the type of relationship that the firm has with their clients.

“We have helped them to create a pipeline of acquisition opportunities so as they always have a number of active discussions with targets, allowing them to deploy an ambitious plan for inorganic growth. Having closed this transaction recently, we are continuing to assist them with other potential acquisition opportunities.”

“This Client sees us as Trusted Advisors, able to add value and support them in their growth strategy in international markets.”

Investor confidence has retuned in Argentina, what factors have driven this?

“Investor confidence is growing in Argentina, but I think that it still has a long way to go. Argentina is benefiting from the momentum that the region has at the moment led by strong economies like Brazil. This certainly helps to encourage investors to come to Argentina. However, I still think that there’s a big gap in terms of confidence between leading markets in the region like Brazil as compared with Argentina.”

“Argentina has to concentrate in creating a more attractive environment for Investors. However, being recognised as a trend setter within the Latin American region, Argentina is very rich in terms of local resources, both human and others, and that certainly becomes of fundamental importance for investors looking for opportunities in Argentina.”

Cross-border has played a major part of Argentine M&A over the last 12 months , with particular interest of late from the BRICs, why is this so?

“After the crisis at the beginning of the 2000’s, M&A in Argentina was not of interest to most international investors. However, this trend

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is changing nowadays and, in the second half of 2010, 77% of the M&A transactions involved a foreign buyer. The top 3 foreign buyers into Argentina which account for over 30% of the M&A deals in Argentina are India and Brazil as well as the US. This illustrates the importance that the BRIC countries have to Argentina in terms of investment.”

“Brazilians are trying to consolidate their position as the leading country in the region and for them Argentina is often a key place to be. This is not only due to the fact that Argentina is one of the biggest Latin American economies and a neighboring country, but also it is a strategic place to be as it sometimes opens the overall Spanish speaking Latin American market to the Brazilians.”

“The Indian rationale for making acquisitions in Argentina is different. We see lots of Indian companies in the outsourcing or BPO space coming to Argentina as a way to deploy their nearshore strategy.

Argentina becomes a key location to these Indian companies as it enables them to serve their Latin American clients locally as well as being closer to and almost in the same time zone as the main cities in the US (e.g. 1 hour difference with the major east coast markets).”

Which sectors are attracting foreign investors?

“Whilst Energy and Agribusiness are at the moment the main areas where transactions are happening, we, as technology M&A experts, closely follow the technology market, which is certainly a key sector for foreign investment.”

“We usually work with strategic buyers within the technology space who see a strategic advantage to have a presence in Argentina or Latin America. We note that these companies are usually businesses focused on a very specific market niche. Hence, they have a strong position in their local markets and need to grow internationally including in Latin America. Thus, Argentina is always an attractive proposition for them.

As an example, we are working with companies in markets like FinTech (i.e. technology for Financial Institutions) or digital publishing (i.e. technology for Publishers) who are eager to enter the markets in Latin American.”

Have you seen any evidence of the return of the large deal?

“In Argentina, the largest proportion of deals are in the medium to small range with more than 60% of the transactions being below USD 20m. However, we are seeing more deals of Enterprise Value USD 100m+ of these days and recent statistics indicate the around 20% of the total deals are of that size.”

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Destination: Argentina Compe it Antitru ion & st L Specia aw list

Hugo Quevedo and Viviana Guadagni Partners

Tnte. Gral. Juan D. Perón 555, 2nd Floor, 2º, C1038AAK Buenos Aires, Argentina Tel: + 54 11 5276 2000 Fax: + 54 11 5276 1001 Web: www.qvda.com.ar Email: hquevedo@qvda.com.ar Email: vguadagni@qvda.com.ar Quevedo Abogados is a Buenos Aires based business law firm committed to providing high quality professional services that cater to its clients’ needs. The team blends the experience, knowledge and talent of a team of recognized professionals devoted to offering the best, most direct and clearest advice possible. Hugo Quevedo and Viviana Guadagni are both partners at Quevedo Abogados.

“Our services cover the core legal needs of businesses and focus on sectors that drive the economy. Our main practice areas include Antitrust, Investments and M&As, Corporate Law, Consumer Law, E-commerce, General Commercial and Business Law Advice, Energy, Mining, Oil & Gas, Forestry, Agribusiness, Healthcare, Administrative Law and Regulation, Intellectual Property, Media and Entertainment, Banking and Finance, Arbitration and Litigation.

“We have been distinguished by several international directories and publications as a leading firm in Argentina in a variety of areas, including Antitrust and Competition Law, Mining, Corporate and M&A, Oil & Gas, Consumer Law, E-commerce, Forestry, Healthcare, Arbitration and Dispute Resolution. Various international publications have also recognized members of our team as leading practitioners in their respective field of practice.

Cross-border has played a major part of Argentine M&A over the last 12 months , with particular interest of late from the BRICs, why is this so?

“A combination of factors have attracted investors coming from BRICs countries. One is the familiarity of these investors to deal with uncertainties and risks similar to those existing in Argentina. Another factor relates to the match between our national production and key sectors and the needs and interest of these investors. Naturally the strength of the economy of BRICs creates the basis for foreign investments coming from such countries.”

What are your predictions for 2011 regarding the Competition & Antitrust Law market in Argentina?

“In line with events in the last few years, it is foreseeable a continuation of an active role of antitrust administrative authorities in the investigation of antitrust infringements, particularly in certain sectors deemed to be of particularly public interest (where media stands out an area of major concern and review).

“In such context it is also foreseeable a continuation of judicial conflicts related to such enforcement of antitrust rules by current antitrust administrative authorities and challenges to their powers pending the organization of the long due antitrust Tribunal created by Law Nª 25.156 in 1999.”

“Our services cover the core legal needs of businesses and focus

on sectors that drive the economy. Our main practice areas

include Antitrust, Investments and M&As, Corporate Law,

Consumer Law, E-commerce, General Commercial and Business Law Advice, Energy, Mining, Oil & Gas, Forestry,

Agribusiness, Healthcare, Administrative Law and Regulation, Intellectual Property, Media and Entertainment, Banking and Finance, Arbitration and Litigation. “

Rogelio N. Maciel Cerrito 1136, 10th floor, C1010AAX Buenos Aires, Argentina

Tel: 54 11 4813 2044 Email: rmaciel@mna.com.ar Web: www.mna.com.ar Maciel Norman & Asociados is a well established law firm which covers all practice areas with a well known practice in Aviation law, which includes a strong expertise in sale and financing of aircraft. We also assist international airlines in regulatory matters, air transport licenses and operating permits, ticketing and conditions of carriage, code sharing and other industry-specific contracts, governmental relations, bilateral air service negotiations, passenger & cargo claims (litigation and arbitration) insurance, taxation, labour, customs, immigration, airport related matters.

“Another well known practice of our firm is that of Energy and Natural Resources Law (oil, gas, mining, electricity, environment, renewable energies, etc) including foreign investments and agribusiness.

“In the last 20 years, we have represented most of manufacturers, lenders and other suppliers of aircraft and engines from the USA and the EU in their sales and/or lease transactions with Argentine airlines and operators, both private and governmental.

“In the same period we have also given advice to well-known up-stream and downstream operators and investors from the USA, Canada, UK, Australia in their investments in the exploration, production, transportation and distribution of hydrocarbons and minerals in Argentina.”

Aviatio Agribu n, sine Specia ss list

Latest cross-border investments, specially from the BRICS “Under MERCOSUR common market umbrella Brazilian investors have acquired important positions in sectors such as meat processing, hydrocarbons, mining, banking, construction, agribusiness, etc. India, another BRICS country, has also been present in Argentine agribusiness and pharmaceutical industry. As for China, it currently holds strong interest in the oil and mining sectors and is, apparently seeking to increase its presence in the Argentine market. Finally, South Africa, has long standing investments in the Argentine mining sector, a relationship that most likely will be strengthened by its recent association to BRICS. “ Predictions for 2011 “Re-equipment of local airlines will probably follow and this would give occasion to further transactions with international suppliers, mainly in the field of leasing.

“As for agribusiness, nothing seems to indicate that the current trend of industry development which has prevailed for the last 10 years is likely to change, considering the so-called Technological Argentine Revolution and the intensive development of farming units.”

What gives you an advantage over local and global competitors in your areas of expertise?

"Our long standing practice and consequent professional experience, as well as our acquaintance with entities, officers and players in the markets where our practice takes place, specially in the field of governmental relations and civil aviation agencies, gives as an advantage over other professionals.

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Establishing & Managing Mutual Funds

ESTABLISHING & MANAGING

Mutual Funds M

ost people invest in mutual funds for wealth creation but it’s important to remember that creating this wealth calls for a careful balance between effective financial planning and risk management. For most, the key benefit of mutual funds is that they open investment opportunities to the masses and give small investors access to professionally managed portfolios of equities, bonds and other securities, which would otherwise be quite difficult to create. The key to success full investing is finding and working with the right company that can offer the right financial management and investment advice for you. Acquisition International speaks to the experts…

Wei-Chien Lim

Capital Markets Partner

42A, Lorong Dungun, Damansara Heights, 50490 Kuala Lumpur, Malaysia.

Tel: 603 2081 7888 Email: weichien@naqiz.com Web: www.naqiz.com Since 2005, Naqiz & Partners have acted as the solicitors and legal advisers to a number of prominent Malaysian unit trust management companies in relation to their collective investment schemes encompassing unit trust funds and wholesale funds. The firm has also acted for both local and foreign clients in relation to the preparation of offer documents for submission to the regulatory authorities. The fund and asset management department is headed by the firm’s capital markets partner Wei-Chien Lim. Collective investment schemes’ investors are typically investors with savings to invest, who have neither the time nor the inclination to hold portfolios of direct investments or shares. The said investors would prefer to invest in a secure, reputable investment vehicle which suits their purposes and which would allow them to have easy access to a wide range of investments not normally available to them. The Malaysian Securities Commission (“SC”) is the sole regulatory body for the approval of the establishment of collective investment schemes which involves making available, offer for subscription or purchase, or issue and invitation to subscribe for or purchase units of collective

investment schemes in Malaysia, including approval of the management company and the trustee. Where there is an issue, offer for subscription, or an invitation to subscribe for or purchase units of collective investment schemes to the public in Malaysia, a prospectus which complies with the prospectus requirements of the Capital Markets & Services Act 2007 (and the Prospectus Guidelines For Collective Investment Schemes) would be required to be submitted to the SC for registration.

Malaysia is considered a popular location for the creation and management of collective investment schemes due to its recognition by international regulators for of its high governance standards. The SC has also responded to the changing investment landscape after the recent downturn by: (i) ensuring consistent investor protection for call capital market products and services; (ii) raising intermediary capabilities and standards of conduct; and (iii) strengthening oversight of products and markets and enhancing system-wide risk management.

Dr. Nicolai Xuereb 198, Old Bakery Street, Valletta VLT 1455, Malta

Malta: Gateway to Europe Supported by a substantial increase in fund administration capacity, Malta is now recognised as a fully-fledged investment funds domicile allowing cost-effective access to the European market. The robust but flexible regulatory framework, supervised by a pragmatic and prompt single regulatory authority – the Malta Financial Services Authority (MFSA), makes the island a domicile of choice. Malta joined the European Union in May 2004 and financial services are regulated by a framework that transposes the applicable European Directives.

Unlike other European fund capitals, Malta remains available to smaller start-ups, and the hands-on approach of the MFSA, the reputation of the banking system, professional English-speaking workforce, central time-zone, Mediterranean weather and quality of life, continue to spur growth in the asset management industry, with more than 70 fund managers now licensed. Set-up and servicing costs also remain considerably lower than in other jurisdictions.

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Tel: +356 21 241 232 Email: nicolai.xuereb@fenlex.com Web: www.fenechlaw.com Malta can also be used to redomicile existing offshore funds without loosing their track record. By obtaining a Maltese licence as a Professional Investor Fund (PIFs) offshore funds can continue in Malta allowing them to move to a European, tax-neutral jurisdiction without losing the same continued legal personality and without having to appoint new local service providers, as is required by other European domiciles.

Redomicilation also offers existing offshore funds to move to Europe and convert into a UCITS platform.

PIFs and retail collective investment schemes are exempt from Malta tax, other than in respect of income from immovable property in Malta. There is no Malta tax on dividend distributions or redemption of units in PIFs by non-resident investors. Malta also offers a very attractive full imputation system of tax entitling shareholders to claim refunds of Malta tax paid by Maltese companies, including licensed asset managers, thereby reducing the effective tax rate after the refund to roughly 5%.

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Doing Business in Bermuda

Doing Business in

Bermuda

Bermuda is a well known centre of excellence for fund administration and it has an established reputation found on the quality, rather than quantity of the financial transactions.

In conjunction with some of the Island’s leading professionals, Acquisition International analyses the region’s willingness to comply with international regulation and approach to illegitimate behaviour, M&A activity over the last 12 months and the opportunities that exist for investors in 2011, the opportunities that exist for setting up and managing funds, local laws and tax regulation that makes the island a popular choice for expansion and formation, coupled with its popularity of trade links with the MENA region and its ideal location for Islamic Finance.

Craig I.V. Bridgewater Crown House, 4 Parlaville Road, Hamilton, Bermuda

Tel: +1 441 295 5063 Email: cbridgewater@kpmg.bm Web: www.kpmg.bm KPMG in Bermuda is part of the KPMG International global network consisting of over 135,000 people in member firms in around 140 countries. Craig Bridgewater is Partner at KPMG in Bermuda.

Regulatory oversight in Bermuda is the responsibility of the Bermuda Monetary Authority (“BMA”).

Bermuda has always looked to adopt international regulation in a form that makes sense to its market. In that respect, the BMA will look to Bermudianise any international regulation. The BMA and participants in the respective industry sectors constantly monitor international regulation for its applicability. Current relevant examples include the European Union’s Alternative Investment Funds Management Directive (“AIFMD”) (funds), Solvency II (insurance), and Basel III (banking), and the US’s FATCA.

Act is a key distinguishing feature of the Bermuda’s legislation.

The Government of Bermuda has recently also signed numerous information exchange agreements and focused on its anti-money laundering (A”ML”) and know your client (“KYC”) legislation. Both of these hold Bermuda in good stead to operate within the parameters proposed under the EU’s AIFMD, Solvency II and Basel III regimes.

The laws related to the investment sector are set out primarily in two acts being the Investment Funds Act and the Companies Act.

Why is Bermuda an ideal location for Islamic Finance?

“Bermuda is an ideal location for Islamic Finance primarily due to its regulation. A study has been recently completed that shows that Bermuda’s regulation is conducive to Islamic Finance structures. The review found that there was no impediment to authorising Islamic investment funds in Bermuda under the current framework. In fact, in April 2011, the BMA released Guidance Notes on Islamic Collective Investment Schemes that facilitate the establishment of Islamic investment funds in Bermuda. (see www.bma.bm).”

The Investment Funds Act (the “Act”) allows for regulation that is most appropriate to the investors in the particular fund in that it allows for the classification of funds as Institutional (for sophisticated investors) or Standard (for retail investors). The Act also allows for the exemption of funds should they meet certain criteria. The flexibility of the

What are your predictions for the future of Bermuda as a leading offshore destination?

“I predict that Bermuda will grow as a leading financial services jurisdiction given its concentration of intellectual capital, experienced and skilled professionals, and flexible, appropriate and responsive regulatory regime.”

Wendell Malcolm Hollis CEO

25 Belmont Hills Drive, Warwick WK 06, Bermuda

Tel: 441 236 1612 Email: whollis@hcsgroupltd.com Web: www.hcsgroupltd.com Wendell Hollis, CEO of the HCS Group which includes HCS Law Ltd. and HCS (Hospitality & Development) Ltd. and Hollis Corporate Services.

“Bermuda has always been seen as a high-end participant in the international tourist market as well as being one of the World’s pre-eminent offshore financial jurisdictions.

Bermuda leads the World in offshore captive and reinsurance companies particularly in the area of high-end catastrophe insurance. Individually some of the World’s most recognised individuals have chosen Bermuda as their second residence and spend a considerable amount of time here.

“The HCS Group adheres to regulations of the Bermuda Bar Association which has recently introduced anti-money laundering and proceeds of crime regulations. Bermuda as a whole is recognised as one of the most comprehensively regulated areas in the offshore financial area.

“Whilst many of Bermuda’s laws are based on comparables particularly drawn from the United Kingdom, a number of Bermuda’s most significant laws have been designed to protect the interest of Bermuda given the small size of our land mass and our population.

The regulation of the international insurance industry is well regarded by regulators throughout the World.

“The primary challenge facing clients is meeting the operational requirements of their company particularly with regard to matters such as Immigration regulations designed to protect and preserve Bermuda and the interests of Bermudians.

“I believe that Bermuda will continue to be one of the World’s leading offshore destinations. I particularly believe that Bermuda will be seen as one of a few areas of the Wold providing safe, secure and high quality residences and second residences for highnet worth individuals who are now searching the globe for areas that provide them both favourable tax regimes combined with personal safety and security.

“I believe that Bermuda is the best offshore location having regard to the length of time that it has spent in the business and the amount of expertise and experience it has built up.

Globally, it has the best physical location for such operations being situated between the markets of Europe and those of the United States. Physically it is the most attractive of all of the offshore jurisdictions and perhaps most importantly it has earned the respect of the global regulators.”

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Competition & Antitrust Risks in M&A Transactions Competition & Antitrust Risks in M&A Transactions

T

he firm advises local Turkish clients and multinational companies in different sectors. ELIG represents corporations, business associations, investment banks, partnerships and individuals in a wide variety of Competition Law matters. ELIG also collaborates with many international law firms on Turkish competition law matters. ELIG aims at providing its clients with high-quality legal service in an efficient and business-minded manner. All members of the ELIG team are very fluent in English.

“ELIG focus on the interests of our clients, and strive for finding flexible legal solutions that fit the ever-changing needs of our clients in their international and domestic operations. We have a legal team of 27 persons. While we take pride in being able to assist our clients in almost all fields of law, the main focus of our practice consists of competition law, corporate law, mergers & acquisitions, EU law, banking and finance, litigation, energy, oil and gas law, administrative law, real estate law, and intellectual property law. As an independent Turkish law firm, ELIG collaborates with many international law firms on various projects.

“In addition to an unparalleled experience in merger control issues, ELIG has vast experience in defending companies before the Competition Board in all phases of an antitrust investigation. We have an in depth knowledge of representing defendants and complainants in complex antitrust investigations concerning all forms of abuse of dominant position allegations and all other forms of restrictive horizontal and vertical arrangements, including price-fixing, retail price maintenance, refusal to supply, territorial restrictions and concerted practice allegations. Furthermore, in addition to a significant antitrust litigation expertise, our firm has considerable expertise in administrative law, and is therefore well equipped to represent clients before the High State Council, both on the merits of a case, and for injunctive relief. ELIG also advises clients on a day-today basis concerning business transactions that almost always contain Antitrust Law issues, including distributorship, licensing, franchising, and toll manufacturing.”

Have there been any notable deals that you have been involved in recently? What challenges were presented to you in terms of antitrust risks? How did you assist your client(s) in minimizing such risks?

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Gönenç Gürkaynak

Citlenbik Sokak No: 12, Yıldız Mah, Besiktas, 34349 Istanbul, Turkey Tel: +90 212 327 17 24 Email: gonenc.gurkaynak@elig.com Web: www.elig.com

Antitrust issues are an important aspect to be considered when negotiating M&A transactions. In the early stages of structuring a deal, the individual parties are often so focused on negotiating the transfer of assets and equity, that antitrust is seen a mere procedural milestone in the process. This attitude unfortunately means that parties often neglect potential antitrust concerns until after an agreement has been made, by this point however, the deal may have been compromised causing further expense and delay.

“ELIG has recently advised on some merger control filings that result in high market shares in the relevant affected markets. There were competition concerns whether the proposed transaction would create or strengthen a dominant position in the relevant affected markets. However, considering the dynamics of the case at hand, we built upon some arguments such as strong competition, capacity increases and significant buyer power in the relevant market, procompetitive effects of the transaction and the competitive pressure in the relevant markets. As a result, Turkish Competition Board accepted our arguments and granted clearance to the proposed transactions (Competition Board’s Lanxess AG- Royal DSM N.V. decision dated 28.04.2011 and numbered 11-26/493-150 and Colombian Chemicals - Aditya Birla Group decision dated 10.03.2011 and numbered 1115/253-82 )” What are your predictions for the next 12 months regarding Competition & Antitrust Law in Turkey?

“Communiqué No. 2010/4 on Mergers and Acquisitions Requiring the Approval of the Competition Board (the New Communiqué), published on October 7, 2010, has replaced Communiqué No.1997/1 on Mergers and Acquisitions Requiring the Approval of the Competition Board (the Old Communiqué) as of January 1, 2011. The New Communiqué brings a new Turkish merger control regime into the Turkish competition law system and is welcomed by the competition law circles. The Competition Authority has recently launched public consultation on the Draft Guideline on Relevant Undertaking, Turnover and Ancillary Restraints in Mergers and Acquisitions and Draft Guideline on the Remedies that would be Permitted by the Competition Authority in the Mergers and Acquisitions. We would be expecting the finalization of the public consultation and the conclusive form of the guidelines. Both guidelines will provide detailed explanations in relation to the application of the New Communiqué.”

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Competition & Antitrust Risks in M&A Transactions Alfonso Miranda Londoño Partner

AvCalle 72 No. 6-30 Piso 12, Bogotá, Colombia.

Competition & Antitrust Risks in M&A Transactions Esguerra Barrera Arriaga Asesores Jurídicos has defended several of the most important merger transactions and antitrust cases in Colombia. The firm has a team of seven lawyers with experience in complex Antitrust, Unfair Trade and Consumer Protection cases. Alfonso Miranda Londoño is a partner and the head of the Antitrust Pratice at Esguerra Barrera Arriaga Asesores Jurídicos.

“An antitrust lawyer has to provide the capacity to understand the industry in which his client participates. He needs to comprehend the larger economic effects of a transaction or a business practice and the particularities of the company and its business in order to be able give a coherent explanation of its economic behavior to the authority.

He also has to be well aware of the local competition law, the authority, its doctrine and trends. The adviser has to be able to orient the present and future business conduct of his client in accordance with antitrust law in order to prevent sanctions that can affect the net worth and stability of the company.”

Have there been any notable deals that you have been involved in recently? What challenges were presented to you in terms of antitrust risks? How did you assist your client(s) in minimizing such risks? In the previous years we have participated in the clearance of some of the most important merger transactions in the country, such as Aces – Avianca; Chevron – Texaco; SabMiller – Bavaria and Éxito – Carulla to name only a few.

It is usual that in these complex merger transactions the main challenges are the discussion of the relevant market and the possible structural and/or behavioral conditionings with the Competition Authority.

Tel: +571 3122900 Email: amirandal@cable.net.co Web: www.esguerrabarrera.com These challenges are met with careful argumentation based in economic data, studies and the knowledge of the industry in order to reach the best possible outcome in which the transaction is cleared and the conditions do not damage the synergies and value creation of the transaction.

“An antitrust lawyer has to provide the capacity to understand the industry in which his client participates.

He needs to comprehend the larger economic effects of a transaction or a business practice and the particularities of the company and its business in order to be able give a coherent explanation of its economic behavior to the authority. He also has to be well aware of the local competition law, the authority, its doctrine and trends.

The adviser has to be able to orient the present and future business conduct of his client in accordance with antitrust law in order to prevent sanctions that can affect the net worth and stability of the company.”

Jacques Philippe Gunther Partner

21-23 rue de la Ville l’Evèque - 75008 Paris, France

Tel: ++ 33 1 53 43 46 92 Email: jgunther@willkie.com Web: www.willkie.com Jacques Philippe Gunther is Partner at Willkie Farr & Gallagher LLP, he is based between Paris and Brussels in charge of the entire competition practice group for Europe, which comprises approximately 20 lawyers.

Jacques-Philippe is known for his expertise advising clients on European and national merger filings and in complex disputes before the European Commission, French antitrust authorities, French Courts and the European Court of Justice on cartel and abuse of dominant position matters. He is also one of the most recognized experts in the field of State Aids. The team is one of the most prominent practices in Europe.

Willkie enjoys a strong reputation advising a large spectrum of clients in all the sectors of the economy, from media, telecoms, defence, chemicals, energy, sports to financial sectors, etc.

Willkie is widely recognized as one of Europe’s leading competition law specialists by the French and European antitrust authorities covering broad range of competition law issues in multiple sectors and combining close relationships with the regulators and the best advices to clients.

Willkie recently advised France Telecom in its procurement joint venture with Deutsche Telekom, PAI PARTNERS in the contemplated sale of its interests in Yoplait, Arkema on its planned acquisition of Total’s resins division and advised GDF Suez before the Court of Justice on a € 550 million cartel case

Upon these appointments, Willkie found the right balance between complying with antitrust rules without killing any business incentives related to a project, whilst educating clients in order to prevent reiteration of cartel practices and advised the client that to settle a case when pursuing a case (litigation) appears to be extremely risky.

What makes you a leading player in this field of law?

“Creative approach combined with deep expertise on legal complex situations. Ranked among the leading practitioners by professional guides like Chambers. GCR ranked the team as the “elite” of the French competition bar.”

Jacques-Philippe is known for his expertise advising clients on European and national merger filings and in complex disputes before the European Commission,

French antitrust authorities, French Courts and the European Court of Justice on cartel and abuse of dominant position matters. He is also one of the most recognized experts in the field of State Aids. The team is one of the most prominent practices in Europe.

Thirty Five

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The Secondary Boom

A History of Success

“Investor interest in the private equity market has grown substantially over the last 10 years.

Private equity has now gained wide acceptance as being an attractive, alternative component to an institutional portfolio, generating high absolute returns over the long-term. “

E

stablished in 2001, Capstone Partners has built a successful track record in raising capital for both established and emerging fund managers. Acquisition International speaks to David Chamberlain, partner in charge of Capstone’s European activities with particular responsibility for business development and secondary market placement services about the firm’s history of success alongside private equity and real estate firms operating across all types of strategies and geographies.

With offices in North America, Europe and Asia, Capstone provides global fundraising and advisory services to private equity and real estate firms around the world.

Capstone serves both investors and general partners for the transfer of interests in private equity funds. The firm aims to build a bridge between long-term strategic investors and general partners to the mutual benefit of all parties concerned. Capstone’s priority is to work with “primary” private equity fund investors, optimising value and securing long-term investor relationships.

For investors seeking to dispose of their interests in private equity funds, the firm brings clarity and help develop a coherent strategy. David Chamberlain added: “We optimise value for the selling investor, whenever possible, through the transfer of private equity fund interests to replacement long-term strategic “primary” investors. We provide anonymity to the seller, acting in our name on their behalf throughout the process of negotiation, sale and transfer. We also bring experience and professional execution skills to the legal and administrative complexity of transferring ownership.”

Thirty Six

For replacement long-term strategic investors, Capstone Partners provide attractive investment opportunities in the secondary market which would otherwise be difficult to acquire. In so doing, they enable “primary” investors to expand their exposure in private equity to mature, invested funds managed by general partners with whom the investor would like to build a long-term relationship.

For general partners, the firm help to ensure a stable base of long-term “primary” investors by providing attractive replacement investors with a strategic interest to develop a long-term relationship with the general partner. In addition, they act as the sole intermediary between the general partner and potential investors, facilitating the supply of information and negotiation of the transfer of interests. Capstone Partners therefore relieve the general partner of much of the time consuming task of managing investor transfers.

How does your firm stand out from its competitors in terms of the services you offer?

David Chamberlain answers: “Investors exposed to long-term alternative assets, such as private equity funds, have an objective to optimise the value and ultimate liquidity of their investment interests.

Private equity firms should aim to ensure that their current and future funding are secured by a diversified group of long-term strategic investors. Capstone helps investors and fund managers to fulfil these goals by identifying attractive replacement investors and managing selective auctions to optimise the terms and conditions of sale and transfer.

“Capstone’s role is to act as the interface between the general partner, the seller and potential acquirers of the limited partnership interests, thereby significantly reducing the time and resources that both the general partner and the seller would need to make available to facilitate the sale and transfer of interests. Capstone therefore manages and co-ordinates the following aspects of a transaction: • Identification of attractive potential investors (subject to prior approval by both the general partner and the seller) • Establishment of the terms and conditions of the sale and transfer process with potential investors • Completion of confidentiality agreements with all potential investors • Preparation of a summary Offering Memorandum for investors • Handling of all investor questions • Collection and evaluation of all offers from potential investors • Recommendation of the preferred acquirer(s) to the seller and the general partner • Negotiation of all transfer documents • Co-ordination of the payment of money and transfer of interests • Co-ordination of the creation of any special investment vehicle to facilitate the transaction David what types of secondary transactions are attractive at this time?

Do you focus on a particular asset class?

“As an experienced participant in the primary fund placement market, we appreciate the effort that general partners must make to secure attractive long-term strategic investors. These investors are

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The Secondary Boom

David Chamberlain North America: One Galleria Tower, 13355 Noel Road, Dallas, Texas 75240, USA Asia: Metrobank Tower, 1160 Yan An Xi Lu, Shanghai 200052, China Europe: Grand Rue 19, 1260 Nyon, Switzerland Tel: +41.22.365.4500/ +1.972.980.5800/ +86.21.6124.2668 Email: dchamberlain@csplp.com Web: www.csplp.com important for the future continuity and funding of the general partner’s investment strategy.

However, as investors increasingly look to the secondary market for liquidity, general partners risk to lose control of certain of these strategic relationships. Capstone’s strategy is to seek to identify attractive replacement investors whose interest to acquire a fund will optimise value for the selling investor and secure a future strong relationship for the general partner. Our understanding of the private equity fund market and our experience in negotiating secondary market transactions allow us to manage secondary offerings in an efficient and unbiased manner, to the mutual benefit of all parties concerned.

“The last few years have been particularly challenging for private equity firms to raise new primary capital. A secondary transaction in an earlier fund, stapled to a primary investment in a new fund, can therefore serve as a valuable means of attracting investors to secure a primary fund raise. Capstone has successfully assisted general partners covering a range of different strategies including buyouts, growth capital, venture, distressed and debt.”

David, have you witnessed an influx of buyers from the primary market?

If so, what are the reasons for this?

“As investor interest in the private equity market matures, so we see the emergence of a sizeable secondary market with a number of private equity funds dedicated to purchasing secondary limited partnership interests. Although the emergence of the secondary market has improved liquidity

for investors, these dedicated secondary funds are deployed with a high degree of sophistication and aim to maximise profit for their investors. They represent large pools of capital and dominate activity within the secondary market, exploiting the relative inexperience of sellers of private equity funds in dealing with the complexity of valuation, negotiation and closing of secondary transactions.

“More recently, a growing number of traditional “primary” investors have developed an interest to acquire private equity funds through the secondary market.

This interest is driven by the strategic importance of combining secondary investments in a traditional “primary” fund portfolio: • Accelerated cash flows with a rapid deployment of capital and earlier distributions • Avoidance of the J-curve • Vintage year fund diversification • Access to top-tier managers • Establishment of new general partner relationships “The objectives of a “primary” private equity investor are therefore multiple and not simply driven by acquisition price. As a result, we believe that a seller of private equity funds can capture a price premium by selling to a strategic investor rather than to a specialised secondary investment fund. We do not, however, exclude specialised secondary investment funds from the process. Their level of sophistication, valuation skills and capital availability may, in certain circumstances, make them the preferred acquirer of a fund interest.”

So at what stage is it common to buy or sell secondary assets? What factors might encourage an individual to do so?

David Chamberlain concluded: “Investor interest in the private equity market has grown substantially over the last 10 years.

Private equity has now gained wide acceptance as being an attractive, alternative component to an institutional portfolio, generating high absolute returns over the long-term.

“As the market matures, so the aims and objectives of certain investors change, requiring a more active approach to portfolio liquidity management. Investors will look to divest part or all of their private equity portfolios for a number of reasons: • Restore private equity asset allocation to target levels • Optimise investment performance and balance sheet liquidity • Respond to poor fund performance or changes to the general partner • Dispose of investments that no longer offer strategic value • Focus on key general partner relationships • Exit non-core assets • Adapt to regulatory changes “Most investors have not had to deal with the complex process of divesting interests in private equity funds. The inherent illiquidity of the asset class combined with the absence of an organised secondary market can make selling a difficult process. This can therefore deter investors from pro-actively managing their private equity portfolio or result in suboptimal returns if sales is not skilfully negotiated.”

Thirty Seven

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The Secondary Boom The Secondary Boom

R

oux Capital is an independent adviser exclusively focused on Primary and Secondary Private Equity assignments. In Primary assignments, the firm acts as a placement agent raising Private Equity funds from active institutional and individual investors. In Secondary assignments, Roux Capital advise investors seeking liquidity for their limited partnership interests, and fund managers seeking to restructure their existing investor base.

Acquisition International speaks to Francois Roux, Founder and Managing Partner of Roux Capital about the Secondary boom.

Roux Capital cover all types of funds on a worldwide basis in buyouts, venture capital, expansion capital, real estate, infrastructure, energy, special situations, mezzanine, and specialized funds.

The firm’s assignments bear on funds of any size, maturity, structure and geography, but their typical secondary transactions range from €10mn to €300mn in size. They also increasingly bear on company portfolios, referred to as direct secondary.

Francois Roux explains: “Our transactions are executed exclusively at the senior partner level. We shy away from junior execution, standardized solutions and large-scale mechanisms. We are always available and believe in hard work. When sellers simply require price maximization, we can organize large, open and competitive auctions like anyone else. But we differentiate ourselves by specializing in limited auctions or narrowly focused private negotiations. For sellers sensitive to discretion and efficiency, we narrowly target a limited number of likely buyers, and we keep sellers' identity secret until closing. We also stand out from our competitors by executing fund restructuring transactions on behalf of General Partners through a combination of primary and secondary money. " He continues: “Our fund restructuring solutions take the form of fund transfer, extension or recapitalization, top-up fund, annex fund, bridge fund, or GP spin-off. They allow the replacement of existing Limited Partners and the injection of additional capital, while keeping the existing GP in place. They induce financial and governance rebalancing and substantial renegotiation of partnership agreement and management contract. In an increasingly Darwinian market, in which primary LPs reduce the number of GP relationships and shun a large number of good quality funds, Roux Capital supports the idea that abundant secondary money can become available to GPs in the form of primary commitments through restructuring solutions such as fund extensions and transfers, and top-up and annex funds.

“We are supportive of such solutions and see them gaining momentum. We generally identify restructuring transactions through GPs who are smart enough to address liquidity concerns before they become critical and public. Those who cannot do so promptly are meant to simply disappear. Large respected secondary LPs we work with on such restructurings consider that up to 40% of the current GP population could become tomorrow's Private Equity dinosaurs. This has already started. Out of 4,000 GPs worldwide, 180 have disappeared in 2010, double the figure for 2009.

Thirty Eight

“Regarding the secondary market, we witnessed a healthy alignment of buyer and seller expectations early in 2010, which reignited the secondary market. Its volume surpassed $20bn in 2010, making it the busiest year on record. The trend is expected to continue all along 2011 and 2012.

“There are two encouraging and structural factors fuelling the buoyant secondary market: Net Asset Values have constantly progressed for 18 months, and we now enjoy single-digit discounts to Net Asset Value, far away from the 30% to 50% discounts prevailing until recently. The distressed sellers are long gone. We are back to market conditions prevailing before the Lehman bankruptcy, with strategic sellers who can tap prices they would not even have dreamt of a year ago.

“Secondary buyers have raised significant amounts of money. They have taken advantage of the crisis years to get an intimate knowledge of funds' portfolios; they have gained confidence in portfolios' resilience. Buyers' visibility has returned to standard levels, along with medium term economic prospects. The public equity market rally has boosted investor confidence and secondary prices, and has generated considerable secondary capital overhang. As a consequence, secondary buyers now require lower returns in the form of 1.3-1.4x target multiple to NAV on large portfolios, 1.5-1.6x on less diversified portfolios, and 1.7-1.8x on direct secondaries.

“Among the largest and most publicized transactions were the acquisitions of a Bank of America's portfolio by AXA Private Equity, a Citigroup's portfolio by Lexington Partners, and a Public Sector Pension Investment Board's portfolio by CPP Investment Board in 2010, and the acquisitions of an Alberta Investment Management Corporation's portfolio by Goldman Sachs Private Equity Group, a Lloyds Banking Group's portfolio inherited from HBoS by Lexington Partners, and a Calpers portfolio by AlpInvest in 2011.

“The current concern is that the market may have heated up a little.

Dry powder has been deployed rapidly, and there seems to be less pressure on secondary buyers to deploy capital now. Some may want to pause and test whether their valuation models will be validated by a sustained economic recovery. But the current $35bn dry powder, slightly eroded by recent large transactions, is being replenished by active secondary fundraisings amounting to $25bn at the moment from many funds including Lexington Partners, Coller Capital, Axa Private Equity and Credit Suisse at an encouraging pace.”

Francois Roux 103, rue de Grenelle, 75007 Paris - France Tel: +33 1 40 56 94 61 Email: francois.roux@rouxcapital.com Web: www.rouxcapital.com

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The Secondary Boom Andrew P. Varney Partner

801 17th Street, N.W. Washington, DC 20006

Tel: +1 (202) 639-7032 Email: andrew.varney@friedfrank.com Web: www.friedfrank.com Fried Frank serves as counsel to many of the world’s largest companies, financial institutions and investment firms from offices strategically located in the world’s principal financial centers. Andrew P. Varney, is partner at Fried, Frank, Harris, Shriver & Jacobson LLP “Our asset management practice provides a full range of legal services to a diverse group of clients, including US and international asset management and private equity firms, broker-dealers, hedge funds and their managers, family offices, high-net-worth individuals and institutional investors.

“Our private equity fund practice, in conjunction with our private acquisitions and private equity practice, includes representations of sponsors, managers, investors, and placement agents of, domestic and international private equity funds across all private equity strategies and geographies.”

What type of secondary transactions do you advise on?

“We assist clients in connection with acquisitions and dispositions of interests in existing private equity and related funds and underlying assets. In addition to traditional transfers of LP interests or portfolios, we also advise clients on synthetic secondaries, structured transactions, spin-out transactions, direct investment secondaries, and acquisitions of illiquid “sidepocket” interests of hedge funds.”

Can you highlight a typical client?

“Fried Frank acts as counsel to Goldman Sachs’ Vintage Fund, which is one of the largest investors in the secondary market for private equity. Our work for the GS Vintage Fund focuses primarily on acquiring portfolios of private equity assets, including limited partnership interests in private equity funds. We have also worked with Goldman Sachs and other clients providing unique liquidity and capital solutions to both limited partners and general partners around the world.”

How does your firm stand out from its competitors in terms of the services you offer?

“The Fried Frank secondaries team integrates practices in multiple specialty areas, including corporate, tax, regulatory, ERISA, securities compliance, finance and litigation, and is recognized for its depth of knowledge, breadth of experience and responsive service that clients require to meet their critical business objectives.”

What should a potential investor new to the market be aware of when considering an opportunity? Any particular legal or tax considerations?

“Adequate due diligence early in the process is critical. When organizing a private equity fund or making a new investment, fund sponsors often form various parallel funds or alternative investment vehicles intended to optimize returns for different types of investors based on the specific characteristics or tax status of the investors or of the portfolio investments being made. As a secondary investor, you are bidding on a particular interest offered by a particular investor and often do not have the luxury of deciding which specific vehicle to invest through or which elections to make – you simply inherit the decisions made by the seller, whose situation may be very different from your own. As a result, understanding the structure of the fund interests that are offered for sale, as well as any elections that may have been made with respect to those interests, is essential to valuing the interests accurately.”

“Our asset management practice provides a full range of legal

services to a diverse group of clients, including US and

international asset management and private equity firms, broker-dealers, hedge funds and their managers, family offices, high-net-worth individuals and institutional investors.

Ethan Falkove

Managing Director

605 Third Avenue, New York, NY 10158

Tel: 212-476-5765 Email: ethan.falkove@nb.com Web: www.nb.com Ethan Falkove is Managing Director responsible for secondary private equity investing at Neuberger Berman. Today, Neuberger Berman manages approximately $18 billion in alternative assets, including over $2.5 billion dedicated to secondary private equity opportunities.

“We have acquired private equity assets across strategies—buyout, growth equity, distressed, special situations, infrastructure, mezzanine, venture—geographies and vintages from a wide range of sellers. Our focus is primarily on acquiring mature, high quality assets. The most important part of our analysis is the robust, bottoms-up, company-by-company valuation and due diligence that we perform. In addition to acquiring traditional limited partnership interests, we will also acquire direct coinvestments and invest in structured solutions and portfolios of directs or “synthetic secondaries.”

“We are focused on providing early liquidity on attractive terms to a wide range of investors. Our goal is to partner with an investor and help them meet their strategic objectives. As such, we believe we need to be flexible and creative. Today, we believe there are attractive secondary opportunities in buyout, growth and special situation funds and continue to under-weight our venture exposure. However, we are always interested to learn more about specific issues facing investors in private equity and welcome the opportunity to engage in discreet, confidential dialogues with investors exploring liquidity alternatives.”

Have you witnessed an influx of buyers from the primary market? If so, what are the reasons for this?

“We saw an influx of non-traditional secondary players in 2009 and saw many leave the market in 2010. We believe that non-traditional buyers can sometimes be more competitive bidders on highly unfunded transactions—so called “early secondaries”— and are sometimes willing to acquire select assets at premium prices. However, many of these buyers are not well equipped to bid on funded transactions or portfolios of assets.

As a consequence, as the number of unfunded trades decreased in 2010 and more portfolios came to market, we witnessed many of these non-traditional players exit.”

At what stage is it common to buy or sell secondary assets? What factors might encourage an individual to do so?

“We typically target assets that are three to seven years old. However, we often see limited partners seeking to reduce their unfunded exposure earlier in a fund’s lifecycle, and it is not uncommon to see tail-end portfolios with assets that are on average eight to 10 years old. Today, we primarily see sellers accessing the secondary market as a portfolio management tool or to comply with regulatory changes.”

How do secondary transactions benefit the wider private equity industry?

“We believe secondary transactions serve an important role in the private equity asset class and enable limited partners to commit capital knowing that liquidity can be found if needed. In addition, as the asset class has burgeoned, the secondary market has become an important portfolio management tool.”

How do you think the secondaries industry will develop over the course of the next few years? What will their role be in the private equity market?

“We believe the secondary market will continue to grow for several reasons. The private equity asset class is attractive and, in our opinion, will likely continue to expand as more investors seek private equity returns and potential outperformance over public benchmarks. Because the secondary market is a derivative of the primary market, we see continued long-term growth of secondary transactions. Moreover, the increasing acceptance of the secondary market and its use as a portfolio management tool will likely also drive volumes higher as well.”

Thirty Nine

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Achieving Post Acquisition Integration

Achieving Post Acquisition Integration “ ”

It takes a long time for the two companies to get to understand each other, and in the meantime competitors walk away with the business.

S

uccessful post-merger integration is the key to generating sustainable added value for companies. Every merger is unique and requires a customized solution. Thomas Schinkel, President, Thomas Schinkel and Associates, Charlestown, who assists companies with their cross-border acquisitions, in the form of coaching, but also with specific implementation plans, elaborates…

“Most of my clients are privately held firms that have grown to a size where internationalization becomes a big issue. Some are driven to internationalization by their customers, big box retailers and mass merchandisers. The financial crisis of 20072009 has been especially challenging to some of them, but it also has opened up opportunities for others.”

Are certain types of firms/ firms operating in certain sectors more likely to make use of post acquisition integration?

“Post-acquisition integration is a catch phrase for a very complex issue that affects different companies in different markets in a different way. Integration is often limited to managing the teams of the two companies that are coming together, trying to find common ground and determining overlap.

What often gets overlooked is the connection to a rapidly changing market. In my experience, sometimes acquisitions are committed to cope with changing markets, but than when the deal is done, all efforts focus on internal processes and team issues, without regard for the larger picture, namely the changing requirements of global customers. It takes a long time for the two companies to get to understand each other,

and in the meantime competitors walk away with the business.

When working with a new client, how do you assess what steps must be taken to achieve post acquisition Integration?

“I try to get my clients to focus on cultural issues, not just geographically but between the two companies, but most of all, I try to have my client map out restructuring costs they may need to incur when the acquisition is done. This needs to be added to the purchase price and only then will it become clear what the payback of the acquisitions is going to be. I have found that each case is different. Integration into a clearly defined business model that has proven acceptance in many different cultures is one thing.

Engaging in a cross-border acquisition and then addressing post-acquisition integration issues in that case is very different.”

aware of the unique post-acquisition needs, not only on the acquirer’s side but also on the side of the company they acquire. Mapping out the talents and skills that are available in the acquired company and then cultivating the relationships in a manner that makes all players feel that they are making a valuable contribution is as important if not more so, than all the financial analysis that gets customary invested in an M&A project.

Overall, it remains a matter of managing uncertainty and providing clarity early on about the way forward. If that means job realignment, or redundancies, address them early on and take action, based on the needs of the market.”

With cross-border activity proving so popular, what are the key challenges when integrating foreign companies?

And how do you solve them?

“The key challenges are strategic and cultural. Many markets are moving targets today and integration needs to be done quickly to keep the organization focused on changing market conditions. I practice on the side of caution and I try to map out worst case scenarios before the deal is signed.”

What are your predictions regarding 2011 and 2012?

“I am cautiously optimistic that 2011 and 2012 will see a modest increase in acquisition activity in the mid-market (companies with revenues in the range of $20-$100 million) and that more companies are becoming

Thomas Schinkel 42 8th Street, Suite 1523, Charlestown, MA 02129

Tel: 001-617-818-8783 Email: Thomas.Schinkel@thomasschinkel.com Web: www.thomasschinkel.com

Forty One

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The Next Hot Spot Insurance & Reinsurance M&A: The Next Hot Spot

Insurance & Reinsurance M&A:

Reinsurance/Insurance M&A picked up dramatically in 2010, following rather low levels of 2008 and 2009. The takeover activity was driven in part by a stabilisation of financial markets, after two years of extreme volatility during the global financial crisis, allowing buyers and sellers to more rationally evaluate risks relating to corporate transactions. Major deals of note include those involving Harbor Point, Brit Insurance and Rain and Hail Insurance Services.

Acquisition International speaks to the experts…

LUÍS FELIPE PELLON

CRAIG FORTUNATO

Partner

Partner

Tel : (55) (21) 3824-7821 (55) (21) 3824-7800

Tel : +350 200 47252

Rua Senador Dantas 74 - 7o andar

Fax : (55) (21) 2240-6907

Email: lfpellon@pellon-associados.com.br Web: www.pellon-associados.com.br

2B Centre Plaza, 2 Horse Barrack Lane, Gibraltar Fax : +350 200 72789

Email: office@verralls.gi Web: www.verralls.gi

Joaquin Ruiz Echauri Partner

Paseo de la Castellana 51, 6 Floor, 28046 Madrid, Spain

Tel: + 34 91 349 82 00 Email: joaquin.ruiz-echauri@hoganlovells.com Web: www.hoganlovells.com The Hogan Lovells’ insurance and reinsurance practice is an award-winning team consisting of 200 plus dedicated lawyers. The firm has been named the “Global Insurance and Reinsurance Law Firm of the Year” in the Who’s Who of Business Lawyers in 2010 for the sixth consecutive year (and first as Hogan Lovells), and is amongst the best insurance focused law firms on practically every edition of Chambers & Partners and Legal 500 guides. Joaquin Ruiz Echauri is a partner on the Insurance and Reinsurance practice of Hogan Lovells, leading the practice at the Madrid office in Spain.

“We work both for Spanish and international insurers and reinsurers. Hogan Lovells is, on that sense, an “insurer oriented law firm”. Amongst our clients are Spanish firstclass insurers like Mapfre, and key international players like Axa, Allianz or Generali.

“In our firm you find real specialists on this sector, fully dedicated and extremely connected to the trends and main issues on this sector. In addition, our global presence grants to our client’s access to first classed insurance law coordinated advice on more jurisdictions than any other competitor “We have recently been BANCO PASTOR's legal advisors on Project Apolo, its life bancassurance alliance with Portuguese Insurer TRANQUILIDADE. On the other hand, we have also completed in 2011 the cross-border merger between the Belgium Company AXA ASSISTANCE and its Spanish subsidiary INTER PARTNER ASSISTANCE, both from the AXA Group, and assisted during 2010-2011 ASEFA (a SMABTP-SCOR Company) on several acquisitions of insurers (LA BOREAL, EXCELSA) and the reorganization of its group in Spain.”

Forty Two

What are your predictions for the next 12 months regarding Insurance and Reinsurance law in Spain?

“We are going to assist to a deep reorganization of the bancassurance map, with two to four main players on the insurance industry dominating the life business through the banking channels; also, some international insurers are going to concentrate its operations across Europe due to Solvency II and it is going to mean more cross-border mergers. Solvency II, finally, will also suppose a higher concentration amongst small and medium local players, something deriving in opportunities for mergers and acquisitions in the Spanish insurance market.”

“We have recently been BANCO PASTOR's legal advisors on Project Apolo, its life bancassurance alliance with Portuguese Insurer TRANQUILIDADE. On the other hand, we have also completed in 2011 the cross-border merger between the Belgium Company AXA ASSISTANCE and its Spanish subsidiary INTER PARTNER ASSISTANCE, both from the AXA Group, and assisted during 2010-2011 ASEFA (a SMABTP-SCOR Company) on several acquisitions of insurers (LA BOREAL, EXCELSA) and the reorganization of its group in Spain.”

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Insurance & Reinsurance M&A: The Next Hot Spot Willem de Nijs Bik & Berry Jonk-van Wijk Partners

Houthoff Buruma is a leading full service law firm of the Netherlands. Houthoff Buruma has been ranked consistently as a tier 1 insurance law firm by the leading legal directories.

Berry Jonk-Van Wijk is Partner in the Insurance Group of Houthoff Buruma and Willem de Nijs Bik is Partner in the Corporate Transactions Group of Houthoff Buruma.

Willem de Nijs Bik commented: “We advise major Dutch and international insurance companies in complex, international multiparty disputes as well as a wide range of corporate and commercial insurance and reinsurance matters.”

Willem de Nijs Bik added: “Through our leading position we stand out as the firm of choice for most larger insurance companies, especially in their large and sensitive issues. We have an in depth knowledge of the sector and are deeply involved in any pending or proposed legislative developments” What does an insurance legal adviser bring to the deal table?

Berry Jonk-Van Wijk replied: “Through the unique combination of sector expertise and deal experience we are able to add value to the M&A process. We are able to identify the relevant deal issues in an early stage and how to translate these into satisfactory, practical and understandable contractual arrangements.”

What are your predictions for the next 12 months regarding Insurance and Reinsurance law in the Netherlands?

Berry Jonk-van Wijk elaborated; “Some fundamental changes are planned regarding insurance supervisory regulations in the next twelve months. These changes mostly influence the distribution of insurances through intermediaries and authorized agents. As per 1 January 2012, the scope of the (existing) regulations on commission transparency and inducement requirements is expected to be expanded to several types of insurance products and distribution channels that are not yet being regulated. Moreover, the Minister of Finance announced a total prohibition on the payment of commission related to insurances in 2013 (it

Willem: Amsterdam, Netherlands. Tel: +31206056166 Berry: Rotterdam, Netherlands. Tel: +31102172429 Email Willem: w.de.nijs.bik@houthoff.com Email Berry: b.jonk@houthoff.com Web: www.houthoff.com

is not certain whether this will apply to all types of insurance). Also, the positive tax implications for certain insurance products have been reduced during the past few years, whereas nowadays other, non-insurance products offered by banks have similar tax advantages. This results in an increasing popularity of bank products.

Berry Jonk-van Wijk concluded: “Due to changing circumstances, we expect that the number of insurers in the Netherlands will decrease the coming years, mostly via mergers between existing insurance companies. Furthermore, we expect that the insurance products themselves will change to increase their commercial appeal. In addition, the regulatory developments as well as sales via internet will change existing distribution models.”

Winne r of 'The L awyer Europ ea n A wa 2010' for 'Be rds nelux Law F irm of the Ye ar'

“Through the unique combination of sector

expertise and deal experience we are able to add value to the M&A process. We are able to identify

the relevant deal issues in an early stage and how

to translate these into satisfactory, practical and understandable contractual arrangements.”

Alan D’Silva

Senior Partner

199 Bay Street, Suite 5300, Commerce Court West, Toronto, Ontario M5L 1B9 Canada

Tel: +1 416 869 5204 Email: adsilva@stikeman.com Web: www.stikeman.com Stikeman Elliott LLP is one of Canada's leading business law firms, with offices in Toronto, Montréal, Ottawa, Calgary and Vancouver as well as in London, New York and Sydney. Alan D’Silva, is a senior Partner at Stikeman Elliott LLP and has, for over 24 years, represented a number of Canadian and international insurers in a broad range of property, casualty, environmental, professional negligence, directors’ and officers’ liability, life, disability and fidelity bond insurance disputes and in large class action cases.

Stikeman Elliott LLP advises large Canadian and international insurance and reinsurance companies, including Chartis Insurance/AIG Inc., Aviva Canada, GreatWest Life Assurance Company, Liberty Mutual Insurance Company, State Farm Insurance, Chubb Insurance, Transamerica Life, Liberty Mutual Group, Lloyd's Canada Inc. and Lloyd's Corporation, and insurance industry groups, such as Insurance Bureau of Canada.

The firm specializes in insurance litigation, including matters involving defence of class actions, corporate/commercial disputes, securities litigation, shareholder/oppression cases, accountants’ and auditors’ negligence, environmental, professional negligence, directors’ and officers’ claims, property and casualty and regulatory issues.

Alan has acted as counsel in more than 140 publicly reported cases and has extensive experience at all levels of court and before administrative tribunals. He has frequently appeared as counsel in Canadian appellate courts as one of the most experienced appellate counsel in Canada, including more than 50 appeals in the Ontario Divisional Court and Court of Appeal and seven recent cases in the Supreme Court of Canada. He is currently lead counsel for several Canadian insurers in large multi-million dollar disputes including major class action proceedings, and directors’ and officers’ proceedings. Alan acted as senior counsel on two of the Top 10 Business Cases in Canada for 2009, as selected by Lexpert including a case involving the constitutionality of the Alberta Insurance Act.

Alan is widely considered a leading practitioner in a number of areas of law, and is listed and recognized in the following publications: > The Canadian Legal Lexpert Directory 2011 as a leading practitioner in Litigation – Class Action and Litigation – Commercial Insurance. > The International Who’s Who of Business Lawyers 2009, 2010, 2011, and 2012. > The 2007 Lexpert Guide of the Leading Canada/U.S. Cross-border Litigation Lawyers in Canada for Corporate Commercial, Class Action and Securities. > The International Who's Who of Insurance & Reinsurance Lawyers 2010 and 2011. > PLC's Cross-border Insurance Handbook 2011. > The 2010 PLC Which Lawyer? Recommended in Insurance: contentious. > The 2011 Legal Media Group’s Guide to the World's Leading Insurance and Reinsurance Lawyers. > The 2006 Lexpert American Lawyer Guide to the Leading 500 Lawyers in Canada as one of the top “25 Litigators to Watch”.Lawyer Guide to the Leading 500 Lawyers in Canada as one of the top “25 Litigators to Watch”.

“Stikeman Elliott LLP advises large Canadian and international insurance and reinsurance companies, including Chartis Insurance/AIG Inc., Aviva Canada. Great-West Life Assurance Company, Liberty Mutual Insurance company, State Farm Insurance, Chubb Insurance, Transamerica Life, Liberty Mutual Group, Lloyd's Canada Inc. and Lloyd's Corporation And, insurance industry groups, such as Insurance Bureau of Canada.”

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Company Formations

100%

Europe Emirates Consultancy, The Fairmont Dubai 6th Floor, Office 605, Sheikh Zayed Road Dubai, United Arab Emirates.

PO BOX 75671 Tel: +9714 311 6547 Fax: +9714 332 8810 Email:info@uae-eu.com Web: www.uae-eu.com

open for business

A

cquisition International speaks to Adrian Oton, Senior Consultant at Europe Emirates Consultancy about how Dubai is 100% open for business and 100% Tax Free.

“The United Arab Emirates, with its rapidly developing infrastructure, investor-friendly policies and political stability, is undoubtedly one of the most attractive business destinations worldwide.

“The UAE follows global best practices and creates a conducive environment for businesses to operate, and presents ample opportunities for both investors from the region and around the world.

“Foreign investors looking to set up a business in any of the industrial cities, special economic zones or free trade zones established in different emirates have access to single window licensing services that promise quick turnaround in terms of registration and visa processing see www.uae-eu.com . Specialised zones for technology, media, education, healthcare, finance and others gives an added dimension to the trade and commercial environment.

“The Government encourages the private sector in a free trade regime with low tariff barriers and minimum legal hurdles. Many multinational companies (MNCs) have established branches in the country, many are engaged in manufacturing products or assembling them and many others have set up distribution centres for the region.

“The UAE’s transformation was made possible by its major natural resource. The economy still relies on oil revenues but the years have seen a progressive shift away from a fossil fuel base to highly diversified all-round growth in manufacturing and trade, with service industries also seeing exponential development in sectors such as finance,

Forty Four

tourism, real estate and information and communication technology. Great strides have also been made in education, healthcare and the general welfare of the people.

“Today, the UAE has one of the most open and dynamic economies in the world. The UAE’s tax-free status, world-class infrastructure, low tariffs and 100 per cent ownership for foreign investors in selected zones, make it the ideal location for setting up new business. Today, the UAE stands as a strong nation built on the foundations of security, hope and economic strength, its modern outlook and progressive society bringing it into the front ranks of the Arab world.”

Other clear advantages to doing business in the UAE include: • 100% Foreign Ownership • 100% Tax Free • No restrictions on profit transfer or repatriation of capital • No corporate or income taxes • A currency, the Dirham, that is stable, secure and pegged to the US dollar • Very low, or non-existent, import duties • Competitive labour costs.

Sectors with strongest demand and opportunity include: • Construction services • Materials and supplies • Defence – Aerospace • Energy – Alternative Energy • Professional services • Select tourism products/services including high-end hotel brands • Healthcare and education services and products • Creative arts and media.

Why Incorporate In UAE? “Thanks to the EU Savings Directive of 2003 and recent US-EU initiatives to wipe out tax havens, the U.A.E became the better place to

incorporate offshore companies for various reasons and purposes. UAE looks set to reap the rewards of a recent EU and US ruling under which banks are now forced to reveal information to tax authorities.

“Financial institutions in the EU and US are now obliged to either disclose tax and bank information to the relevant tax authority, or charge client a hefty withholding tax.

“Though the new directive specifically affects EU residents, a number of banks in ‘tax havens’ have also agreed to exchange customer information, including Jersey, Guernsey, the Isle of Man, the British Virgin Islands, the Cayman Islands, Switzerland, Liechtenstein, Monaco and San Marino.

“The reputation of discretion for some of these countries is being eroded. Since July 1, 2005 in order to keep details of their private, bank customers now have the option of paying a withholding tax which will be levied directly in the country in which their savings are held.

This will be charged at a rate of 15 per cent for the first three years, 20 per cent for the following three years, and 35 per cent from 2011 onwards.

“The United Arab Emirates has long enjoyed a reputation as a secure, tax-free jurisdiction for international banking and company incorporation.

“With this latest development from Europe and the US, Dubai company registration and corporate and personal banking options have become the most popular choice with international businesses and high net worth individuals.

“Since the UAE are neither a signatory to the relevant directive, nor agreeing to cooperate with the Organization of Economic Cooperation and Development (OECD), it again looks poised for even further growth.”

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Company Formations Mrs. Joy Godfrey Managing Director

35 Barrack Road, Third Floor, Belize City, Belize

Tel: 011-501-223-3738 Email: jgodfrey@cititrust.biz Web: www.cititrust.biz CITITRUST International Inc. is an 18+ year responsible international financial services company operating at the highest level of integrity, professionalism and confidentiality, with an excellent reputation among their professional clients and within the business communities they operate.

Acquisition International speaks Joy Godfrey, Managing Director at Cititrust International Inc about setting up shop in Belize, a jurisdiction that offers not only efficient laws, low cost, cheap labor but also Zero Tax. “According to the IBC Act the requirements for incorporation of a Belize IBC is that one or more persons subscribe to a Memorandum & articles of Association and the M&A is submitted to the Registrar who will retain & register them and issue a Certificate of Incorporation under his hand and seal certifying that the company is incorporated.

“The Act also sets out the guidelines for drafting of the M&A, including how to name the company and prohibited business activities for a Belize IBC. “Request for incorporation can only be submitted by a licensed Registered Agent, who is obligated under the “Know Your Client” principle and has to conduct proper Due Diligence on their clients.

“There fore it is extremely important to use an industry professional since with the new international laws which takes a beneficial owners place of residence into account advice or guidance is always needed.”

What are the current company formation levels in Belize?

“Company formation levels 103,477 total companies of which 9000 was for 2010 (lower than 2009 which was 9177).

As we slowly recover from the economic downturn, do you have any predictions for 2011, in terms of demand in your jurisdiction?

“The economic downturn plays only a small part in driving this industry, the directives of the OECD and laws of different jurisdiction is the driving force of this industry.

Therefore from that standpoint the predictions for 2011 doing business the old way will not work, the new way of utilizing Tax Treaties and all new legislations will take time so 2011 will be slow. I see 2012 as a better year.”

“The economic downturn plays only a small part in

driving this industry, the directives of the OECD and laws of different jurisdiction is the driving force

of this industry. Therefore from that standpoint the

predictions for 2011 doing business the old way will not work, the new way of utilizing Tax Treaties and all new legislations will take time so 2011 will be slow. I see 2012 as a better year.”

Mr Osman Ramdin Managing Director Tel: 230 210 5209

Email: allfinanz@intnet.mu AllFinanz Consulting Ltd is a licensed professional firm in Mauritius, providing accounting, auditing, taxation and business advisory services, including company formation for both domestic and global business companies.

“Our clients, both local and international, can always rely on us for advice and solutions to their problems. We accompany them through every steps of their decision-making, advising them on all matters and guiding them to achieve their objectives. “ Mauritius is a small island in the Indian Ocean and is reputed for its beauty. Over the past years, the economy has experienced major socio-economic developments with substantial economic growth averaging 5% per annum. Mauritius shifted from an agricultural economy to a service based one. Our financial sector has become the second pillar of the economy after tourism. According to the World Bank, for the third time in a row, Mauritius ranks highest in the region on the overall regulatory ease of doing business and globally, the country ranks 20th among 183 economies.

“Companies in Mauritius are categorized into domestic and global business. Domestic companies are incorporated under Companies Act 2001 and primarily deal on the local market. Global Business companies are also incorporated under Companies Act 2001 and regulated by the Financial Services Commission. Global business companies are subcategorized into GBC1 and GBC2. The main difference between GBC1 and GBC2 is that GBC1 is tax resident and enjoy Double Tax Treaty Agreements signed with 36 countries (18 more treaties awaiting signature) “The fiscal regime is one of the most attractive in the region. Corporate and individual income tax is rationalized at 15%. Among the numerous benefits as provided under the Income Tax Act 1995, we could highlight the followings: • No Capital Gains tax • Tax free dividends • Free repatriation of profits, dividends and capital

Web: www.allfinanzconsulting.com

Global Business companies are taxed effectively at 3% for GBC1 and 0% for GBC2.

“Mauritius has been very attractive to foreigners for using the country as a hub for investment in the region. With one of the world’s most competitive fiscal regime, Mauritius is becoming a reference in the region and in the world with a sustainable economic growth. The financial sector experienced a boom in the past years. More than 40% FDI in India comes from Mauritius. The Double Tax Treaty Agreements signed with 36 countries is an ideal platform for international tax planning and investment structuring.

“The attractiveness of Mauritius as an international financial center rests on the quality of services and its pool of highly qualified professionals. Since its inception in 1992, the Global Business Sector in Mauritius has experienced sustained growth. Being a solid pillar of the economy, our financial sector is recognized as a reputable, stable and fast growing sector by professionals globally. The number of global business companies registered in Mauritius has reached more than 25,000 and is expected to increase by approximately 10% for the year 2011.” www.allfinanzconsulting.com provides a comprehensive guidance on our services. Any queries could be sent to allfinanz@intnet.mu.

“Our clients, both local and international, can always rely on us for advice and solutions to their problems. We accompany them through every steps of their decision-

making, advising them on all matters and guiding them to achieve their objectives. “

Forty Five

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Company Formations Mark Jason Bridge Director

Watergardens 6, Suite 24, P.O. Box 629, Gibraltar

Tel: +350.200.79013 Fax: +350.200.70101 Email: mark.bridge@europa.gi Web: www.europa.gi The Europa Trust Company Ltd is part of the Europa Group, an independent, privatelyowned group. The company is based in Gibraltar and over the years has built a reputation as a stable and reputable business. Amongst their business partners, Europa count many well-established European financial, banking and fiduciary institutions.

Mark Jason Bridge, B.Juris, LL.B, LL.M is a Director at Europa Trust Company Limited.

“Europa provides bespoke company and fiduciary services to individuals, families, businesses and intermediaries at competitive professional rates. They can deliver and manage on a daily basis simple or complex corporate and trust structures in virtually any jurisdiction. Their extensive expertise and understanding of each structure’s individual requirements is matched by a wide range of supporting services.

“Over the last 40 years Gibraltar has established itself as a prosperous financial centre.

Benefiting from a stable and growing economy and a favourable tax regime, its political stability, robust commercial and professional infrastructure contribute to its attractiveness as a financial jurisdiction.

“All of Europa’s services come with the reassurance of a knowledgeable response, professional ethic and unwavering customer focus.”

“Gibraltar is part of the European Union and yet within close proximity to Africa. It is a low tax jurisdiction and is VAT free. There is no Capital Gains tax, Estate Duty, Wealth, Inheritance, Gift or other capital taxes. It has an International airport and excellent road and sea links into Europe and Africa.

“The legal system is based on English Common Law with some local statute law variations. As part of the European Union, Gibraltar provides easy access to the EU financial markets and as such is subject to its directives and regulations.

“New fiscal legislation has taken effect that includes exceptional tax statuses for High Net-Worth Individuals and High Executives Possessing Specialist Skills and a new low corporation tax rate of 10% applied on an accrued and derived basis.

As a busy sea port, Gibraltar also offers marine services. Vessels can be registered under the British flag in Gibraltar (Red Ensign) and enjoy privileges afforded by such registration.

“For over 25 years, Europa Trust Company Limited has been providing a comprehensive range of company and trust formation and management services including company and trust administration, nominee directors, shareholders and secretaries, accounting, marine registration and other associated services.

“Europa provides bespoke company and fiduciary services to individuals, families, businesses and intermediaries at competitive professional rates.

They can deliver and manage on a daily basis simple or complex corporate and trust structures in

virtually any jurisdiction. Their extensive expertise and understanding of each structure’s individual requirements is matched by a wide range of supporting services.”

Karl Horsburgh

Managing Partner

15-17 avenue Gaston Diderich, L-1420 Luxembourg Grand-Duchy of Luxembourg

Tel: +352 4040341 Email: advice@htgroup.lu Web: www.htgroup.lu HT Group of companies is staffed by experts in their field, Chartered Accountants, Réviseurs d'Entreprises and Experts-Comptables. . Karl Horsburgh is Managing Partner at HT Group S.A. All Luxembourg companies other than pure holding companies (SoParFi) must obtain a permit or authorisation from the Luxembourg Government to conduct a trade or business. The Luxembourg Government will grant authorisation in the name of a director or manager and in the name of the company.

liability company is divided into shares. A shareholder may easily transfer shares by contract or, if the Luxembourg Company is listed on a stock exchange, without limit. A shareholder’s liability is limited to their nominal equity. Limited liability companies are subject to Luxembourg corporate income tax.

The Luxembourg SA and the Luxembourg SARL are the most common forms of companies in Luxembourg and the most common business structures used by resident businesses.

All newly formed businesses must register with the Trade and Companies Register.

Special registration rules exist for Luxembourg Companies from the financial industry.

These companies must register with the Financial Oversight Regulator (Commission de Surveillance du Secteur Financier or CSSF). The tax authorities inform newly formed businesses of applicable taxes based on the business structure chosen and assign them taxpayer identification numbers.

Company Formation Incorporation of a limited liability company occurs through a notarial deed that includes articles of association.

Certain industries require special licences to do business in Luxembourg (autorisation de commerce) issued by the Ministry of the Middle Classes (Ministère des Classes Moyennes) which is responsible for all matters relating to trade, manufacturing, the skilled craft trades and some liberal professions. Specific businesses in the finance industry sector (e.g. banks, investment funds and insurance companies) require licences issued by the Ministry of Finance.

Each shareholder must pay up at least 25% of their part of share capital at incorporation.

Shares must have a minimum par value of €1.24 per share. The minimum share capital for a Luxembourg SARL is €12,400. The entire share capital of a Luxembourg SARL must be paid up at incorporation. Shares of an SARL must have a minimum par value of €24.79 per share. Only registered shares are allowed.

A branch of a foreign company must register with the Trade and Companies Register.

If a branch has commercial activity, it must obtain a permit to do business (autorisation d’établissement).

Limited Liability Companies One or more persons, either individuals or legal entities, may form a limited liability company (Luxembourg SA, or Luxembourg SARL) for the purpose of conducting a business venture and dividing profits among investors. The equity capital of a limited

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The following minimum requirements exist for the share capital of limited liability companies: the minimum share capital for a Luxembourg SA is €31,000.

Luxembourg 2011 and Beyond We have already seen a change in the pattern of business in Luxembourg as we slowly recover from the economic downturn. We see a much greater use of sophisticated corporate entities especially in the field of securitization and intellectual property income. Luxembourg is very well placed to develop in a broad range of services to a wide range of industry, commerce and investment, including institutional and personal investors.

We feel it has a very bright future.

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Company Formations Elizabeth L. Thomson Founder & President

6th Floor, St. John’s Building, 33 Garden Road, Central Hong Kong

Tel: +852 2854 4544 Email: elt@icstrust.com Web: www.icstrust.com For over a quarter of a century, ICS TRUST has been working with both independently owned and multinational companies who are doing business internationally and expanding into Asia and China. Elizabeth L. Thomson is the Founder and President of ICS TRUST (Asia) Limited.

Ms. Thomson has assisted thousands of highly successful individuals and businesses by providing them with a tailor-made and integrated suite of services, including: international corporate tax, commercial, and trade solutions for doing business in Asia and China as well as assisting them to stay competitive in the global market. ICS TRUST (Asia) Limited is a recognized leader in providing North American and European clients with custom designed corporate and commercial solutions for building success in the China market and internationally.

A Hong Kong Limited Company is the standard corporate vehicle of incorporation.

Hong Kong is the 3rd most important financial centre in the world. Accounting standards are recognized worldwide and are compatible with international standards.

Firms in Hong Kong are well-equipped to do consolidation of accounts, incoporating the unique and complex Chinese accounting standards. Hong Kong has an established and independent judiciary. The legal system is world recognized for being fair and efficient.

Withholding tax on dividends repatriated from China to Hong Kong is 5% and the withholding tax from Hong Kong to any other jurisdiction is 0%. Withholding tax from China directed to the United States, Canada and most other jurisdiction is often 15 to 25%. Corporate Tax in Hong Kong is only 16.5% and levied on a territorial basis.

Revenues booked which are generated offshore of Hong Kong should incur 0% tax.

Although Hong Kong’s low-tax system makes it attractive to do offshore business, the system does not recognize offshore business as a separate sector. The types of companies generally incorporated by non-resident or offshore business people are the same ones used by residents and nationals for active local trading. Under the Companies Ordinance, Cap. 32, companies may be either public or private, and may be

unlimited, limited by shares or limited by guarantee. The preferred vehicle for offshore or international business is the private Hong Kong limited company, usually limited by shares.

If your non-Hong Kong incorporated company is a body corporate and has established a place of business in Hong Kong, it is required to register under Part XI of the Companies Ordinance. You should apply for registration within one month of establishment in Hong Kong.

The 2009-2010 Annual Report for the Hong Kong Companies Registry states that 107,416 companies were incorporated for the year at a rate of 8,951 companies per month. Seventy-nine percent of these companies were one-member private companies.

Total company incorporations peaked in the 2008-2009 year at 109,416 companies from a low of 75,817 companies in the 2005-2006 year.

“Withholding tax on dividends repatriated from China to Hong Kong is 5% and the withholding tax from Hong

Kong to any other jurisdiction is 0%. Withholding tax from China directed to the United States, Canada and most other jurisdiction is often 15 to 25%. Corporate Tax

in Hong Kong is only 16.5% and levied on a territorial basis. Revenues booked which are generated offshore of Hong Kong should incur 0% tax.”

Tonia Antoniou Partner

Address: 35, Thekla Lysiotis St., Eagle Star House, 6th Floor, Limassol 3030, Cyprus

Tel: +357-25363685 Email: tonia@kyprianou.com.cy Web: www.kyprianou.com.cy Michael Kyprianou & Co. LLC has established an enviable reputation as a broad based legal practice and areas of specialization include corporate and commercial law, local and international taxation, banking law, real estate law, admiralty, shipping, insurance law, local and international arbitration and intellectual property.Tonia Antoniou, Partner at the firm Michael Kyprianou & Co LLC “A Cyprus company needs to have at least one director, one shareholder, one secretary and registered office in Cyprus. The minimum share capital of the company is €0.01 (or in any other currency).

“The first step in the process is the choice of the name of the company to be approved by the Registrar of Companies. The name must include the word “Limited” or its abbreviation “LTD” to signify limited liability status. The period for the approval of the name is 6-7 business days but for urgent cases our law firm can offer a list of names already approved by the Registrar of Companies.

“Then the memorandum and articles of association of the company are prepared and submitted for registration to the Registrar of Companies together with the information regarding the officers and shareholders of the company.

“It will take approximately 5 working days to obtain a Company Registration Number and another 5 working days to obtain the Company’s Corporate Documents. For urgent cases our law firm can offer a list of shelf dormant companies already registered with the Registrar of Companies.”

What can your jurisdiction offer to prospective companies?

“Cyprus has a very advanced tax planning culture based on an extensive double taxation treaties network. In recent years and further to the accession of Cyprus into the European Union a large number of international structures involve a Cypriot company. Cyprus at present features the lowest fixed corporate tax rate (10%) in the European Union and a very competitive V.A.T. rate (15%).”

What are the current company formation levels in your jurisdiction? How far do you agree that these figures act as economic barometer?

“Up to 31/12/2010 there were 237.372 companies registered with the Registrar of Companies in Cyprus and 19,278 new incorporations in 2010. Cyprus has an open, free-market, service-based economy and is a modern economy, with dynamic services and advanced physical and social infrastructure. The Cyprus government recognizes the importance of company formations and protects such services by maintaining tax rates at the lowest rates and other measures that attract foreign investors in Cyprus.”

As we slowly recover from the economic downturn, do you have any predictions for 2011, in terms of demand in your jurisdiction?

“As we slowly recover from the economic downturn, 2010 has already shown the increasing demand for Cyprus companies which continues in 2011 and will do so for the years to come.”

“It will take approximately 5 working days to obtain a Company Registration Number and another 5

working days to obtain the Company’s Corporate Documents. For urgent cases our law firm can offer a list of shelf dormant companies already registered with the Registrar of Companies.”

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The Company Secretary, Taking Care of Business

The Company Secretary,

C

Taking Care of Business ompany directors and top-tier management are in business because they have the drive and insight to make a success of their product and company. Legal matters and secretarial duties on the other hand, for most, are not an area of expertise. Many SMEs and even some large firms outsource some, or all of their secretarial needs to independent firms to ensure that governance, regulatory and compliance issues are met, and in order to free up their time to concentrate on what they do best, running the business and earning money! Acquisition International speaks to Christine Lim, the head of the corp. Secretarial div in Rikvin Pte Ltd based In Singapore.

Rikvin Group was founded in 1998 on the premise that entrepreneurs require a service that empowers them to achieve their business incorporation goals in the most cost-effective and expeditious way while maintaining the highest level of personal confidence in the quality of the corporate services offered.

With staff strength of more than 50 employees, Rikvin has designated departments which are lead by highly experienced professionals with extensive experience in Singapore’s company incorporation, tax and immigration regulatory frameworks.

“Our clients are from all over the world ranging from individuals, small- medium enterprise to large Fortune Top 100 companies. It is our mission and pleasure to provide a quality service with maximum efficiency and productivity, helping new businesses with the first step on their journey to success. Come join our growing family of satisfied clients and professionals.”

“We pride ourselves in taking practical solutions driven approach, utilizing technical knowledge and extensive practical experience to provide strategic advice to our clients in a wealth of complex situations.”

Since inception, Rikvin has grown from a one man operation to more than 50 employees. From a small office to a Sales office in Equity Plaza and Rikvin Hub (Its very own 3 1/2 storey shop house) located at Telok Ayer.

Rikvin was the first in Singapore to launch the online company incorporation website in 1999, which has proven to be an invaluable tool for entrepreneurs who require a swift incorporation process. With

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its own propriety in house computerised software, it was also the first incorporator in Singapore to offer company incorporation process within an hour.

“When you contact Rikvin, you will speak directly to a member of our Business Advisory Team, which consists of qualified company secretaries and accountants, specially trained in company formation and registration. We look forward to being of service to you in your new venture or ongoing business in Singapore.”

One to One So what gives you an advantage over the competition?

“Rikvin has a team of professional and experienced company secretaries, accountants, tax advisers and immigration experts and as such is able to provide more of a “’Under One Roof consulting services’’ and out of the box solutions to clients. We have to date an estimated 4000 clients from all over the world who have set up their base in Singapore. Out competent consultants are multi lingual and are able to converse and interact with international clients without a problem.”

What are the legal requirements in appointing a company secretary in your jurisdiction?

“Under Section 171 of the Singapore Companies Act, every private limited company in Singapore is required to appoint a company secretary who is either qualified or has the relevant experience within 6 months from the date of incorporation.”

“As a result Rikvin appoints one of its professional company secretaries to act as company secretary for clients and render company secretarial services.

Are you a member of any association? What benefits do you receive? “ I am a member of SAICSA (Singapore Association of Institute of Chartered Secretaries and Administrators). As a member I receive updates on any changes in the Act, am able to attend seminars.

SAICSA monitors my work and ensures that I comply with the code of ethics as company secretary are adhered with. SAICSA also will investigate any complaints by clients.”

Mr Victor Moke P O Box 545, Ga-Rankuwa Mpumalanga 0221 South Africa Tel: 012 327 4336 Email: dvmoke@telkomsa.net

Satish Bakhda 20 Cecil Street, #14-01 Equity Plaza, Singapore Tel: 0065 64388887 Email: satish@rikvin.com Web: www.rikvin.com

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International Transport and Logistics Review

Trains, Planes & Automobiles Deal Activity in the transport and logistics sector, as measured by the number and value of deals has show an encouraging return to growth. The mega-deal has returned and 2010 drew extremely positive comparisons with 2009. 2011 is ready for an influx of large strategic investors and Q1 has already witnessed some interesting and encouraging signs. Acquisition International speaks to the experts about the international transport and logistic market.

Mr. Ravi Kini

Managing Attorney

Bilquees Mansion, 261/263 D.N. Road, Fort, Mumbai-400 001

Tel: (+91) 22-2261 2527 / 28 / 29 Email: ravikini@mvkini.com Web: www.mvkini.com Established in 1978, MV Kini & Co, presently has 150+ lawyers advising on infrastructure contracts, Project financing, Banking, Corporate and Commercial laws, FEMA, litigation, arbitration, international trade disputes, aviation and transport, property, labour and service matters, environmental law, WTO law, etc..

MV Kini & Co is empanelled lawyers for the Air India Limited, IATA, Brihan Mumbai Electricity Supply and Transport Undertaking, Dedicated Freight Corridor Company Limited and others. We also advise in projects for Railways, Metro Rail, etc.

“With our pan India presence and on the strength of our dedicated lawyers specializing in their respective fields, we are able to offer the best advice both in litigation and in corporate matters with less turn around time and on enviable rates.”

What do you bring to the table during a transaction, and how does this assist in getting deals through to completion?

“Structuring the transaction on the basis of the applicable principle of law in a manner best suited to the need of the Client, within the options available under the Law and choice of option which makes the transaction legally feasible and practical acceptable as per the competitive market norms.

How has the global downturn impacted on the Transport and Logistics industry in India?

“Like many other sectors, due to timely action and strong policies and guidelines framed by the Government, the global downturn had not much impact on the Transportation and Logistic industry in India.

Taking into account economic growth and development of infrastructure in India large deals are expected in 2011.”

Have there been any notable deals that you’ve been involved in recently in transport

What levels and patterns of activity do you foresee over the next 12 months? How heavily

“Among others, we vetted the “Aircraft Charter Agreement” for B747-300 aircraft for the rescue of

“Because of sustainable economic growth of India and Traffic growing at Compounded Annual Growth

and logistic arena?

Indian nationals trapped in the Libyan political turmoil. Having regard to the sensitivities involved, the assignment was executed within 24 hours.

Stelios Stylianou Senior Partner

linked is this with the price of oil?

Rate (CAGR) of over 10.16% in the last five years, the sector shall continue to grow in the next 12 months. The high traffic growth rate does not seem to suggest that price of oil is so heavily linked with growth of the transport and logistics sector.”

Dina Dousca-Stylianou Co-Founding Partner

12 Platonos Street, 4th Floor, GR-18535 Piraeus, Greece.

Aviatio n an Marin d e Specia lists

Tel: +30 210 411 7421 Email: twostyls@stylianoulawyers.com Web: www.stylianoulawyers.com The law firm Stylianou & Stylianou was established in early 1978 and soon developed and flourished in its two main areas of expertise, namely shipping and aviation law. In the context of this expertise the firm has long experience in the handling, defending and litigating claims relating to the carriage of passengers, luggage and cargo.

The firm has been acting as legal counsel to shipping and aviation insurers, P&I Mutual Assurance Associations, Shipping Companies and Airlines and in this capacity has been entrusted the defence, handling and negotiated settlement of all kinds of claims arising from the carriage of passengers, luggage and merchandise.

The firm has been involved in many of the aviation and marine casualties which occurred in the area of Greek territory in the course of the last thirty years.

The Senior Partner Stelios Stylianou has been practising law in the aviation and shipping fields for more than 38 years and his team of expert lawyers – members of the firm consists of the co-founding partner Dina Dousca-Stylianou and the associates Mara Stylianou, Petros Blessios and Ariana Stylianou.

Since 2004 Stylianou & Stylianou has been classified by the International Who’sWhoLegal as one of the most prominent law firms worldwide in aviation.

With a full range of legal correspondents across Greece and the Republic of Cyprus the firm is in perfect position to offer first class legal services in all transport matters, claims and disputes in general, which could arise in the area.

The firm has been acting as legal counsel to shipping and aviation insurers, P&I Mutual Assurance Associations, Shipping Companies and Airlines and in this capacity has been entrusted the defence, handling and negotiated settlement of all kinds of claims arising from the carriage of passengers, luggage and merchandise.

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Shipping and Maritime International Transport and Logistics Review

Around 90% of world trade is carried by the international shipping industry. Without shipping the import and export of goods on the scale necessary for the modern world would not be possible. The recession has had a lasting impression on the industry; the fall in the freight market has caused severe difficulties and the lack of liquidity from banks has made financing new projects extremely challenging, more recently the rise in bunker fuel costs has been an added blow to many.

S

That said, it’s not all bleak; the industry is in good health in the Far East with China and Singapore both experiencing high growth and worldwide a return to growth has been witnessed across most of the principle segments with last year’s export volumes on the principle routes were up overall by 7%. Thanks to the growing efficiency of shipping as a mode of transport and increased economic liberalisation, the prospects for the industry’s future growth remain strong.

ena Demircan Ciloglu, LL.M is the founder of Demircan Law Office, located in Istanbul Turkey and operates through its correspondent lawyers all around the country, which provides unique, efficient, value-added solutions and excellence service in relation to both international and domestic matters for the clients both in Turkey and overseas.

charterers, operators, brokers, insurance companies, underwriters, P&I Clubs, banks, local and foreign corporations, foreign law firms, investment companies.”

Fernando A. Linares is Partner at TAPIA, LINARES & ALFARO, a fullservice Panamanian Law Firm assisting domestic and foreign clients.

Since its foundation in 1949, TAPIA, LINARES & ALFARO have been one of the leading Panamanian law firms, with a well develop and strong practice in offshore and international matters (Vessel Registration & Finance, International Shipping & Trade, Offshore Corporations, Trust & Foundations, International Arbitration, Admiralty and Shipping Litigation), however, the Firm’s extensive general practice includes all areas of the law.

“The Republic of Panama and the Panama Canal are brand names in international shipping. The open registry of Panama, established in 1925, has enjoyed the confidence of shipowners and financial institutions all over the world since its creation. Proof of this is that the Panamanian Ship Registry is the largest in the world in number of vessels as well as tonnage with 22% of the world’s merchant fleet flying its flag. As of December 31, 2010, Panama flag registration topped the list with 8,899 vessels in international service, for a total Panamanian registered tonnage fleet of 201,903,127.00

Sandro O. Monteblanco is Chief Executive Officer and Senior Partner at Law Offices of Montblanc & Associates, LLC. The firm specialises in shipping law to clients of any size , as the firm offers a wide range of services that can be tailored to the company’s needs.

“Since its inception TAPIA, LINARES & ALFARO has been one of the most active law firms in registering vessels on the Panamanian Ship Register and providing advice to shipowners in the obtainment of all legal documents require by vessels registered under the Panamanian flag, like navigational patents, radio license, minimum safe manning certificates and other relevant documents. Furthermore, with the coming into effect of the new International Ship & Port Facility Security Code, we have been providing expert advice to shipowners on how to comply with this new maritime regulation especially in the obtainment of the International Ship Security Certificate and the Continuous Synopsis Record. We also provide legal advice to ship-owners and financial institutions on financing transactions, attendance at closings, drafting of corporate authorities, issuance of legal opinions and in the drafting, reviewing and registration procedure of Panamanian naval mortgages.

What areas of shipping law do you specialise in?

Sena Demircan Ciloglu, Demircan Law Office: “The firm comprises of lawyers with experience in virtually every type of legal matter facing the marine industry, including collisions, groundings, charterparty, bill of lading and cargo disputes, sale and purchase of ships, shipbuilding contracts, ship arrests, salvage and pollution in the Turkish Streets, P&I and other contractual claims and disputes.

“Our clients can also enjoy services for ship finance, including search into the finances, assets, credibility, advice on Turkish mortgages, drafting or review of loan agreements, lease contracts, mortgage registration from our experienced team.

“Our Law Office is also very active in non-marine matters and has a growing practice in company searched, formations, commercial agreements, partnership formations, liquidations, employment law, taxation, insurance, re-insurance, banking, company and commercial, energy, personal injury and litigation fields to our clients.

“We enjoy domestic and international clientele from all over the world of all sizes from a wide range of sectors that include ship owners,

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Fernando A. Linares, TAPIA, LINARES & ALFARO: “ I specialize in Vessel Registration & Finance and Admiralty and Shipping Litigation.

“The Republic of Panama has become one of the major crossroads of the world's shipping lanes an almost a compulsory passage for many of the vessels currently engaged in international trade and commerce. There are over 40,000 ships from all parts of the world calling Panamanian Ports every year and over 14,000 of them transit the Panama Canal. In fact, commercial transportation activities through the Canal represent approximately 5% of the world trade. This, combined with the expanding maritime services industry and the creation of two special Admiralty Courts, with exclusive jurisdiction over maritime claims (including those involving accidents while transiting the Panama Canal), have contributed to significantly increase the importance of the Republic of Panama’s as a

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International Transport and Logistics Review

Ms. Sena Demircan Ciloglu

Address: Rumeli Cad. As Apt. No: 25-27 K: 3 D: 5 34363 Nisantasi, Istanbul, Turkey

Fernando A. Linares

Tel: +90 212 296 7292

Address: Capital Plaza Building, 15 Floor, Roberto Motta boulevard, Costa del Este, Panama city, Republic Of Panama.

Web: www.demircanlaw.com

Email: flinares@talial.com

Email: sdemircan@demircanlaw.com

convenient ship arrest jurisdiction, turning it into an ideal and convenient forum for many claimants to secure their claims and enforce maritime liens.”

“Our qualify attorneys are capable of representing the interest of ship-owners, charterers, cargo owners and underwriters, mortgagees, P/I clubs, banks and other various shipping interests in all kinds of maritime claims, including collisions, salvage, cargo claims, charter party disputes, ship mortgage executions, and other related maritime cases.”

Can you highlight a typical client i.e. large/medium sized firm?

Fernando A. Linares, TAPIA, and LINARES & ALFARO: “TAPIA, LINARES & ALFARO represents shipping companies of all sizes as well as some of the most prominent and active ship financing institutions worldwide. The firm also provides legal advice to a large number of national and international clientele involved in various activities ranging from the largest cruise ship company in the world and the largest soft-drink bottling company in Latin America, to companies engaged in banking, insurance, securities, telecommunications, energy, transportation, manufacturing, gamming, shipping and trade, among others.”

How does your firm stand out from local competitors in terms of the services you offer?

Sene Demircan Ciloglu, LL.M, Demircan Law Office : “Specialization in shipping industry allows us to understand client’s needs and provide high-quality solutions to clients. The executive team of the firm consists of lawyers with highly specialized and

Tel: +507 306-5000

Sandro O. Monteblanco

Address: Lima, PERU

Tel: (51) +1 251-9628

Email: info@peruvianlaw.com Web: www.peruvianlaw.com

Web: www.talial.com

involved in this industry last 10 years. We aim to provide our clients with complete and satisfactory solutions, meeting their needs with immediate advice and thus, ensuring a time and cost efficient approach.”

Fernando A. Linares, TAPIA, LINARES & ALFARO: “The firm’s main areas of strength are its well-trained group of lawyers and professional staff with strong expertise in their respective areas of practice who strive to provide the best possible professional advice and efficient legal solutions to our clients.

The firm invests heavily in computer and telecommunications equipment in order to make sure that contact with the clients is always maintained at the higher level. We are committed to developing a true partnership with each of our clients and to provide costeffective and timely service.

The quality of our standards of practice and our personal specialized services provides us with the capability to offer our clients around the world a complete and integrated range of legal services.

The firm encourages clients to visit our offices whenever possible to meet the attorneys and staff who handle their work.

The new offices of TAPIA, LINARES & ALFARO are located at the modern Capital Plaza Building, 15th floor, Roberto Motta Boulevard, in Costa del Este, the zone of major growth in Panama City, a few minutes from the center of the city and from Tocumen International Airport. We have a staff of more than thirty persons, including well trained secretaries and several paralegal and assistants supporting lawyers in their daily work.”

Which areas of the shipping industry in your jurisdiction have been most affected by the recession?

Sena Demircan Ciloglu, LL.M, Demircan Law Office: “The lands of Turkey are located at a point where the three continents and being an important point where Europe and Asia meet. Turkey's geopolitical position as a link between the east and the west makes the transportation industry crucial for the economic development of the region. It makes Turkey a major player in shipping industry.

“Turkey is one of the countries with a culture of maritime; however after liberalisation policy was adapted in the Turkish economy in the beginning of the 1980s, Turkish shipping has shown significant increase and development. In recent years, particularly in ship building industry and ship managements are increasing growing in Turkey.

“Ship construction industry no longer has the same dimensions in Europe once it was.

Eventually this business had to grow out of Europe due to environmental dynamics and several restrictions and Turkey was there as the first stop on way of the sector’s movement toward the east. Even though ship construction enjoyed increasing orders accordingly improved capacity which brought the brightest period between 2005-2008, with the recent global crisis demand for the new construction decreased as well as previous orders was cancelled. Therefore, most of the ship construction companies suffer from high capacity with lower demand which is a recovery phase now.

“Apart from ship construction, sea transportation where Turkey plays an important role due to its unique geographical

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International Transport and Logistics Review characteristic was negatively affected with the decrease in international demand coupled with grain export ban by Russia” Sandro O. Monteblanco,Law Offices of Montblanc & Associates, LLC: “First and foremost, we are the only Maritime Law Practice in Peru. Our services schedule this area of the firm is 24/7. We are a multilingual team and can cater to the client’s needs in a professional and expeditious way.”

Is the industry showing signs of recovery in your jurisdiction?

Sena Demircan Ciloglu, LL.M, Demircan Law Office; “Most of the foreign companies start investing in Turkey. There are advantageous to invest in Turkey even in a conjuncture under such crises. Turkey is one of the places where the maritime sector will future expands and grows for many years to come.

Recently, an ongoing privatization worth $850m was finalized in Istanbul for sea transportation of municipality, which are good signs of both recovery and improvement for future.

“Turkey’s potential for particularly ship and yacht construction is also very attractive and advantageous for investments. In the near future many European companies would be investing in Turkey, mainly in the field of port management and construction.”

Fernando A. Linares, TAPIA, LINARES & ALFARO: “A crisis in the Panamanian port system was felt in the year 2009, in which only 4.2 million TEUs were mobilized, a fall of 8.8% compared to the year 2008, when there were 4.6 million TEUs moved.

However, the port system is indeed showing signs of recovery. For the period January to December 2010, the movement of containers in Panama increased by 32.4% (units) and 31.8% (TEU's), compared with the same period in 2009. Similarly, the containerized cargo (in metric tons) increased by 30.9%.

Also, during the year 2010, 168.784 motor vehicles were moved through Panamanian ports which represented an increase of 55.5% compared to 2009.

“The imports and exports for the year-end 2010 increased by 14.6% compared to the same period in 2009 where there was a decrease of 15.2% compared to 2008. Imports (CIF) in 2010, increased 17.4% comparing to the year 2009 and, since in 2009 these figures reflected a decrease of 13.6% comparing to

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2008, we can conclude that the imports had a significant increase for 2010. While the value (FOB) exports, reflects a decrease of 11.8% for the period January-December 2010, it have been greatly enhanced compared to the same period in 2009, where the decline was of 28.2% compared to the same period in 2008.

“With respect to marine traffic, the arrival of ships in international trade increased by 7% in 2010 compared with 2009. Also the movement of ships of International trade in ports managed and operated by the Panama Maritime Authority registered an overall growth of 18.7 % and the movement of International trade ships in ports managed and operated by private businesses also had an increase of 7.7%.

“The activity of selling of marine fuel is very important for the Republic of Panama, which is positioning itself as one of the major regional centers for bunkering. Several projects have been implemented to take advantage of the vessels transiting the Panama Canal of which the large majority bunker while waiting for transit. The ports in both the Pacific and the Atlantic coast of Panama reflected fuel sales growth for 2010 of 4.3% and 7.1% respectively.

“In spite of the global financial crisis that badly hurt the shipping industry, the Panama Canal performed according to its forecast during the years 2009 and 2010 registering a slight decline in total transit and tonnage compared to the year 2008. In 2010 canal transits experienced a marginal decline of 0.7% down to 14,230 transits from 14,342 in 2009, which also experienced a marginal decline of 2.4% from 14,702 transits in 2008.

Cargo volume which fell in 2009 by 3.4% to 299.1m PC/UMS tonnes down from 309.6m PC/UMS tonnes in 2008, increased slightly to 300m PC/UMS tonnes in 2010 and the year 2011 forecast an increase in tonnage growth of 1-1.5% to 305m PC/UMS tonnes.

Although there are signs of improvement, the speed of recovery seems slow and the Panama Canal is still far from the record breaking cargo volume of 312m PC/UMS tonnes in 2007. It is unlikely that there will be a major increase in cargo flow, because so far the economy of the United States of America, which is the major customer of the canal, is showing very moderate growth for the next couple of years. However, the toll increases put in place in 2006, have enable the canal’s revenues to continue growing at an average of 10-11% per year, with tolls breaking the US$1

billion milestone in 2007 with US$1,183.9 million, US$1.317.5 million in 2008, US$1,428.2 million in 2009 and US$1,482.1 in 2010. The year 2011 forecast an increase in toll revenue up to US$1,525 million.

“In view of this, we can conclude that Panama’s shipping and trade continues to improve substantially.”

Sandro O. Monteblanco,Law Offices of Montblanc & Associates, LLC:”Absolutely, exports are up considerably and sustainable if compared to previous years. In our case there was nothing to recover from, just growth to be proud of.”

Which sectors are performing well and driving growth in your jurisdiction?

Which countries account for the majority of your exports?

Sena Demircan Ciloglu, LL.M, Demircan Law Office: “Ship and port managements are performing well. The size of the Turkish shipping fleet is continuing to grow with an increasing trend. Several maritime companies of the country are well-known and are functioning both in Europe and many parts of the world. There are also at present European companies in Turkey function in maritime sector.”

Fernando A. Linares, TAPIA, LINARES & ALFARO: “The Panamanian maritime industry represents more than 20% of the Gross Domestic Product and is one the fastest growing sectors in the national economy.

Investment resulting from development and privatization of ports exceeds the sum of one billion dollars and the expansion of the Panamanian port system continues in both oceans. During the last 15 years, the port activities in Panama have evolved into its highest level in growth and development. In 2010, the Panamanian port system moved 5,593,199 TEUs, that is 31.8% more compared to the year 2009 and the investment made in the Panamanian ports expansion has more than doubled the income in the auxiliary maritime industry in the last ten years, from US$74 million in 2002 to more than US$3,000 million in 2010.

“The Republic of Panama plays a crucial role in the world shipping industry. Nearly 40% of shipping containers in Latin America are handled by the Panama Canal. In view if this, Panama is on its way to becoming the container trans-shipping center of Latin America and the Caribbean. The container transshipment ports

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International Transport and Logistics Review movement has been tripled in less than a decade and the contributions of the Panama Canal to the Panamanian National Treasury has been doubled. Containers movement rose from about 1.9 million TEUs in 2004 to about 6.5 million TEUs in 2010 and the contributions of the Panama Canal to the Panamanian National Treasury increased from US$386.2 million in 2004 to US$817.6 million in the year 2010.

“The Panama Canal Authority (ACP), an autonomous entity of the Government of Panama, with exclusive Constitutional powers over the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, in late 2007 launched the expansion of the Canal, currently one of the largest construction projects in the world. Soon to be 100 years old, the 80 kilometer canal structure joining the Pacific and Atlantic Oceans is close to its maximum transit capacity. The programmed expansion of the Panama Canal to be completed in the year 2014, will be done at an estimated cost of over US$5.25 billion, allowing the passageway of vessel carrying 12,000 TEUS and duplicating the capacity of the canal to 600 million tons each year. The expansion will benefit the Canal as well as its customers that will be able to transit the waterway with longer and wider post-panamax vessels.

“The United States of America is the main customer of the waterway with 67% of the cargo either originating from or destined to a US port, followed by China, Chile, Japan and South Korea.”

Sandro O. Monteblanco,Law Offices of Montblanc & Associates, LLC : “ The Agricultural sector will always be at the top of the list given Peru’s rich soil and plant varieties. The copper industry in Peru has been a long-time leader in the world, closely competing with our neighbouring Chile.”

How have you had to adapt to meet the needs of your clients during this difficult time?

Sena Demircan Ciloglu, LL.M, Demircan Law Office; “On the contrary to the other firms, even though all the companies negatively affected during this difficult time, most of our clients was able to pass these days with minimum damages due to their strong financial structures, planned and well balanced growth strategies. Our clients correctly analyzed the demands in the world market and converted the present situation in their favour.

Our firm aims to provide a more efficient and

effective representation to a wider spectrum of clientele during this difficult time.”

Sandro O. Monteblanco,Law Offices of Montblanc & Associates, LLC: “While Peru was not facing difficult times, we understood that the situation was different for most of the world. We had long-time clients who through the years had helped us grow coming to us with issues that needed tending but were not in a position to pay the usual retainers.

Because of our relationship, clients were awarded credit and even the possibility to pay us in instalments.”

There have been some high profile acts of piracy and hijackings in recent years; how does your jurisdiction respond to this?

Sena Demircan Ciloglu, LL.M, Demircan Law Office: “Turkey’s participation in the international force against piracy and hijackings became part of public debate when Turkish commercial ships were hijacked by pirates in 2008 and 2009. Turkish warships in the mission have engaged in numerous clashes with pirates.

What are your predictions for the future of the shipping industry in your jurisdiction?

Sena Demircan Ciloglu, LL.M, Demircan Law Office; “Current level of Turkey shipping industry is not at the levels where it should be in terms of volumes, importance in Turkish business life when you take into consideration the geographical characteristic of Turkey.

Therefore, we may conclude that with growth capacity of Turkey fuelled by increasing export-import will bring great growth opportunity to shipping industry to the levels where it should be. The main aim of Turkish shipping industry should be raise the standard to a first class level.”

Fernando A. Linares, TAPIA, LINARES & ALFARO: “Panama's geographic position has made it a major international shipping and commercial crossroads since colonial times.

Following the construction of the Panama Canal, a vibrant service industry dedicated to the international shipping community developed to become the country’s primary source of economic activity. Political stability, the use of the U.S. dollar as legal tender, the absence of exchange controls and the enactment of special laws have been instrumental in promoting the growth of this industry.

“In spite of the crisis that hit the maritime

shipping industry in 2009, Panamanian port operators are optimistic as shipping and port activities are starting to show signs of improvement.

“The expansion of the Panamanian port system and, most important, of the Panama Canal will continue to contribute with the steady growth of the shipping industry in Panama and will play an integral role in Panama’s journey to become the transportation and logistics hub of the Americas. The expansion will enhance Panama’s strategic geographical position laying the framework for increasing economic activity bringing benefits not only to the Republic Panama but to the region and world trade. It will open the canal to new routes and untapped markets segments, allowing larger vessels to transit and increasing capacity. Outside of the waterway, Panama´s cluster of offering, from modern ports and container terminals to its business friendly environment helps make Panama an attractive logistic center.

“Also, the Republic of Panama is one of the most modern and progressive tourism destinations in Central America. 279 Cruise Ships arrived to Panama in 2010 carrying 680,788 passengers, representing an increase of 4.1% in respect to 2009. The Republic of Panama offers the advantage of two cruise terminals, on the Atlantic and on the Pacific Oceans, which are being expanded in order to respond to an increasing demand from the cruise industry, including mega cruise vessels.

“Although Panama offers a wide variety of attractions and activities, the Panama Canal is perhaps its best-known and most popular attraction. The Canal is one of the most fascinating places in the world where human ingenuity, and the wonders of nature, come together to connect two great oceans and join the world.”

Sandro O. Monteblanco,Law Offices of Montblanc & Associates, LLC : “We believe that the need for maritime law specialist in our jurisdiction is becoming ever so more imperative. Globalization is driving firms worldwide to liaise with counterparts in countries that never before had this need. The import/export industry needs to realize that shipping law is an area of the law designed specifically to oversee and secure their legal processes in the field. As time progresses and the industry evolves, a time will come where the understanding of the need of a maritime law firm will be second nature.”

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ecent world events have prompted a renewed focus on rising energy costs and higher food prices. The repercussions will likely shift the global economic landscape in the near term. In the second-quarter issue of the Global Economic Outlook, Deloitte member firm economists have examined the effects of these events and offer their insights on global food inflation and soaring energy costs. The report also sheds light on the rise of income inequality across the world.

“Since our last quarterly outlook, the world has been awash with unexpected events,” says Ira Kalish, Director of Global Economics, Deloitte Research, part of Deloitte Services LP in the United States. “In this case, political events in the Middle East and the ruinous earthquake and tsunami in Japan have cast a shadow over the global economy. In this issue we examine the continuing evolution of the global recovery, including challenges to growth in the affluent markets and the fight against overheating in the emerging world.”

At the heart of the report is the global economic impact of the current political unrest in the Middle East and the outlook for growth in a world of volatile energy prices. The issue also examines topics such as soaring food prices, rising income inequality, and the global impact of the recent Tohoku earthquake in Japan.

The report discusses how policymakers in Japan will keep a watchful eye on the currency lest the yen rise too rapidly; however, the authors state that Japan’s rebuilding efforts could also rekindle much-needed inflation.

The outlook on the United States economy is optimistic, though with commodity prices on the rise and inflation picking up worldwide, the authors suggest that the stage is set for the liquidity trap to melt.

The Eurozone recovery is exposing the cracks between member states— high debt among fringe nations and high inflation in the core. Authors expect some imbalances in the United Kingdom as well, as the economic focus shifts from consumers and government toward the revitalized private sector.

The outlook for India and Brazil remains healthy. Fiscal conservatism will go a long way to increase market confidence and encourage business spending, according to authors.

The authors say that in China, rising oil prices and changing demographics will lead the Chinese economy to expand at a more sustainable pace.

The Russian economy is poised for growth on the back of higher energy prices. However, authors say that sustainable growth depends on investments in energy production, scaling back of payroll taxes, and greater transparency.

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DEAL DIARY

DEAL INDEX Abrisud ADA Cosmetics Arjowiggins Afrifresh Group Atomic PR B&B Hotels group/Fonciere des Murs Camaieu CCE Energies d&b audiotechnik Dar Saada European hotel portfolio/ Morgan Stanley GittiGidiyor Guzman Gastronomia Hans Anders Group Herzog HusCompagniet Maritza East III Power Holding/Maritza O&M Holding Kiss Kiss Bank Bank

58 58 58 59 59 59 60 60 56 60 61 61 61 63 63 63 64 64

Metro Cash & Carry Microtecnica Norit Northland Resources Novaservis Oxxio Parcours Phones 4 u Pizza Marzano Resysta International Rated People Roberts and WellClad Som Biotech Ulusal Faktoring The Forum for Expatriate Management Twin Filter Walter Services Group Who Digital

64 65 65 65 66 66 66 67 67 67 68 57 68 69 68 69 69 70

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DEAL DIARY

O

Odewald acquires d&b audiotechnik

dewald&Compagnie has acquired sound system provider d&b audiotechnik GmbH together with management from Afinum Management GmbH for an undisclosed amount.

The investor sourced the deal via an auction exclusively run

by Berenberg Bank, Frankfurt. The transaction is subject to merger control approval.

The capital will be used to achieve further growth of the company by increasing its market share in existing international markets and expansion into new markets, mainly in Central and Eastern Europe, Asia and South America, as well as by enlarging d&b's product portfolio.

The company operates under the brand d&b and has sales subsidiaries in the US, UK, Japan, France, Italy and Spain. In 2010, d&b generated sales of approximately €41m, while employing some 200 people.

“

Key for success with respect to our role was our ability to be time and resource efficient because of our integrated approach.

We were able to handle ambitious process timing through intensive interdisciplinary work. The team enjoyed working with Odewald on this exceptionally interesting target and industry.

Our first target led by management in hoodies.

”

RoelfsPartner provided an integrated financial and commercial

due diligence to Odewald & Comagnie and also acted as sole Tax

Adviser the the buyer. The team was lead by Arndt Rautenberg

“

(Executive Partner), supported by his partner colleagues Markus

Kurzhals (Financial) and Jossip Hesse (Tax)."

arndt.rautenberg@roelfspartner.de .

The key challenges faced derived from the speed of the process and the need to be able to deliver a fully financed competitive bid. This required to understand the competitive dynamics around the process as well as to understand the market environment of the company. As the core relationship bank and long term lender of d&baudiotechnik, UniCredit was well prepared to work alongside Odewald to fulfill the tight deadlines and provide significant inside to understand the full potential of the business and get comfortable to provide a fully underwritten financing for the deal.

”

UniCredit represented the buyer Odewald&Compagnie as M&A advisor on this

deal. UniCredit has a long standing relationship with Odewald and decided to

offer a one-stop shop package solution on this deal providing M&A advisory and

Odewald acquisition of d&b audiotechnik

Legal Adviser to the Equity Provider Financial Adviser and Debt Bank to the Equity Provider Financial & Commercial Due Diligence Provider Legal Adviser to the Vendor Vendor Due Diligence Provider Tax Adviser to the Buyer Risk & Insurance Due Diligence Provider

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debt financing to Odewald. Alexander Arauner Managing Director for Corporate Finance Advisory at UniCredit led the team, heading the TMT activities.

Goetzpartners represented the seller, Afinum, a long standing client, performing

commercial vendor due diligence on their behalf. Michael Hommert (Partner) led the team, assisted by Dr. Frank Schwenold (Senior Manager).

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Glacier Energy acquires MB Aerospace subsidiaries

F

ollowing investment capital from Maven Capital Partners and Simmons Parallel Energy Fund, and debt finance from Clydesdale Bank, Glacier revealed that it has acquired pipeline machining company Roberts, and welding services specialist WellClad.

The two companies had previously formed the MBAe Oil & Gas unit of MB Aerospace, which has been gradually selling off non-core operations since its management buyout from Motherwell Bridge in 2007.

“

DEAL DIARY

MB Oil & Gas is well established and positioned to prosper as an independent business- the senior industry experience of the extended Glacier management team harnessed with the financial backing of the private equity investors creates an exciting platform for focussed growth and development.

”

Deliotte acted on behalf of Glacier and the financial investors on the deal. The

“

Deloitte team was led by Graeme Sheils, Partner. Graeme is a member of

Deloitte’s Oil and Gas Industry team and has extensive experience in acting on

private equity backed transactions in the oilfield services sector.

Kudos IFS Ltd acting for both Maven Capital Partners LLP and Simmons Parallel Private LP carried out an in-depth analysis of the target company’s existing Employee Benefits programme with a view to establishing the financial commitments, the transferring employee’s benefit expectations and identify any and all potential risks and financial liabilities to Glacier Energy Services.

”

Jim Tennent Managing Director led the team with the report

being finalized by senior analyst Alex Sutherland.

info@kudos-ifs.co.uk

Glacier Energy acquisition of MB Aerospace subsidiaries Financial Due Diligence Provider Legal Adviser to the Vendor

Risk & Insurance Due Diligence Provider

Commercial Due Diligence Provider

Pensions and Employee Benefits Adviser

Fifty Seven

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DEAL DIARY

Munksjö forms a world leading specialty Paper Company

Munksjö have closed the acquisition of ArjoWiggins’ decor, abrasives, thin papers and fine arts businesses including the mills in Arches, France and Dettingen, Germany, as of March 10. With this acquisition Munksjö forms a world leading specialty paper company.

Hammarskiöld & Co was Munksjö’s lead legal counsel in the transaction. Local law advice was provided by Jeantet in France and Shearman & Sterling in Germany. The Lawfirm Hammarskiöld & Co’s team was lead by Jakob Falkman and Erik Fahlgren, assisted by Linn Wredström, Christina Blomkvist, Magnus Bohman and Elisabeth Elvingsson. Hammarskiöld & Co’s antitrust department, headed by Claes Langenius and Joakim Sundbom, assisted

by Patricia Helanow and Rickard Haglund, played an important role in realizing the deal.

Activa Capital Backs MBO of Abrisud Activa Capital is a leading French midmarket private equity firm, who manages over €500 million of funds on behalf of a wide range of institutional investors has backed the management buy out of Abrisud.

Created in 1996 in the South West of France, Abrisud is Europe’s leading pool enclosure manufacturer and installer. It employs 270 people and generates a €50 million turnover across Europe.

Since 2005, the company, managed by Jean-Pierre Charpentier and FrançoisXavier Desgrippes, has embarked on a dynamic growth strategy. Abrisud has developed the most extensive pool enclosure range on the market; a new marketing and Internet / CRM policy dedicated to individual customers has resulted in strong growth and market share gains.

We are excited to shape the company for the future, giving both new and old customers increased added value. The integration work has already started and will give us a strengthened manufacturing network and with the R&D Centre in Apprieu, France, we will be in the frontline for new innovations.

It was very difficult to quantify the pool enclosure market as no data was publicly available. We had to create a model based on the pool market, which gave us good estimates of pool enclosure sales until 2015. We also challenged the business plan of Abrisud’s management and stretched it by 15%.

Jan Åström President and CEO Munksjö AB.

Patrick Richer, Founder, assisted by Kevin Bailey, Manager led the Neovian Partners team.

Munksjö acquisition of Arjowiggins

Activa Capital Backs MBO of Abrisud

Legal Adviser to the Purchaser

Financial Due Diligence Provider

The Carlyle Group acquires Hotel Amenities Supplier ADA Cosmetics

Global alternative asset manager The Carlyle Group (“Carlyle”) has acquired ADA Cosmetics (“ADA”), an integrated supplier of hotel amenities and cosmetics, from Halder Private Equity (“Halder”). The management will continue to retain a minority stake. Financial terms of the transaction were not disclosed.

Headquartered in Kehl, Germany with approximately 270 employees, ADA has established itself as the largest supplier of cosmetics and accessories to premium hotels in Europe and expanded its offering across Asia and the Middle East. Hotel customers include well-known luxury hotels such as Brenners Park Hotel (Baden Baden), Etihad Tower (Abu Dhabi), Badrutt’s Palace (St Moritz) and high-end chains including Relais & Chateau, Steigenberger and Mövenpick. The Company also serves many other 4 and 5 star hotels and chains.

Otto Mittag Fontane advised Halder in this exit-transaction from the beginning of the auction process until negotiation and drafting of the share sale agreement on all relevant legal and tax issues. The team consisted of Dr. Thomas Hofacker, Dr. Hans-Jochen Otto (Partners) and Ivo Dreckmann (Associate) and had also advised Halder on the acquisition of ADAGroup in the year 2006.

The Carlyle Group acquisition of ADA Cosmetics M&A Adviser

Financial Due Diligence Provider

Legal and Tax Adviser to the Vendor

Strategic Due Diligence Providers

Financial and Tax Vendor Due Diligence

Financial Adviser to the Vendor Legal Adviser Virtual Data Room Provider

Fifty Eight

Legal Advisers

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DEAL DIARY

Standard Chartered acquires 30% equity stake in Afrifresh

Standard Chartered Bank's Private Equity division has acquired a 30% equity stake in the Afrifresh Group, a South Africa-based producer and exporter of citrus fruit and table grapes.

Afrifresh was founded in 1992 as an agency business, but since 2007, has actively expanded into production through farm acquisitions, creating a more integrated, profitable and sustainable business.

The transaction involved four jurisdictions, so we worked with a number of firms located in the Netherlands, Hong Kong and the British Virgin Isles. We were able to draw on our international network on the deal as we are associated with SNR Denton.

Glyn Marais acted for Standard Chartered Private

Equity on the deal.

Willem de Villiers, head of the commercial

department, led the team, assisted by Darren Acres,

senior associate.

wdevilliers@glynmarais.co.za.

Huntsworth plc acquires Atomic PR

FdM acquires B&B Hotel portfolio in Germany

Huntsworth PLC, the global public relations and healthcare communications group, has acquired Atomic PR for a cash consideration of $13.3 million with further performance related consideration.

Foncière des Murs (FdM) has completed the acquisition of a portfolio of hotel properties in Germany from the B&B Hôtels group for EUR 65 mln, including real estate transfer tax.

The acquisition consists of the entire issued share capital of the US entity Atomic Communications, LLC ("Atomic US"), 50% of Atomic Communications Holdings Limited in the UK and the bespoke web based data analytics application, ComContext.

KDV assisted Atomic PR through coordination and analysis of financial information during the due diligence process with multiple acquisition parties.

The coordination of information with worldwide parties was a success because of timely communication.

KDV maintains a payroll service provider continuing relationship with Atomic, and coordinates internal financial analysis on a regular basis.

The team was led by Steve Wischmann,

partner at KDV.

Standard Chartered acquires 30% equity stake in Afrifresh

Legal Adviser to the Equity Provider

Huntsworth plc acquisition of Atomic PR M&A Adviser to Atomic PR

The deal, which was first agreed in October last year, encompasses 18 properties offering 1,843 rooms in Germany.

The international law firm Taylor Wessing represented the financing bank, Corealcredit Bank AG, as legal advisors.

The Frankfurt based team was led by partner Prof. Dr. Jörg Kupjetz who has been assisted by associate Ulrike Staats.

The international law firm Rödl & Partner represented three companies of the FdMgroup acting as borrowers in aforementioned financing transaction, as legal advisors. The Nuremberg based team was led by associate partner Jürgen Siegl in collaboration with associate partner Dr. Ulrich Hottenbacher located in the Eschborn office of Rödl & Partner.

Jürgen Siegl comments: “It was a challenging opportunity for us to advise this international financing transaction involving the coordination of different parties in Germany, France and Luxembourg on very short term. A strong personal commitment of all parties involved was the key for closing this deal successfully.”

Juergen.Siegl@roedl.de www.roedl.com

FdM acquisition of B&B Hotel portfolio Debt Providers

COREAL Legal and Financial Advisers

Financial Due Diligence Provider

Internal Auditor to Atomic PR Legal Adviser to the Vendor

Legal Advisers to the Debt Providers

Tax Advisers Charted Public Accountants to Atomic PR

Fifty Nine

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DEAL DIARY

Cinven ups stake in French retailer Camaieu Private equity firm Cinven has bought an additional 30% stake in French budget retailer Camaieu for circa 388 million euros.

Cinven bought a 65 %stake in Camaieu from Axa private equity in 2007 for 1.5 billion euros. After this transaction is completed the firm will own 95% capital share.

Cinven is a leading European buyout firm, founded in 1977, with offices in London, Paris, Frankfurt, Milan and Hong Kong.

Arnaud Mourier, Tax partner at Taj - Société d'avocats led the team.

amourier@taj.fr www.taj.fr

Martine Glineur, Partner, head of valuation practice at Eight Advisory

martine.glineur@8advisory.com contact@8advisory.com www.8advisory.com

Cinven acquires additional shares in Camaieu Legal Adviser to Modacin

CCE Energies acquired

Green Power Partners, a Danish renewable energy projects investment fund managed by Proark Energy, has acquired 100% of the French company CCE Energies which owns several roof top solar projects in the south of France for a total capacity of 7.11 MWp. This transaction has been one of the biggest deals in the photovoltaic sector in France. Both parties, Prosolia Group and Green Power Partners have been extremely flexible and creative in the architecture of the deal structure to find appropriate solutions to different issues concerning the photovoltaic market in France.”

B Corporate acted as financial adviser on the deal,

with Borja Andreu, Partner heading the team.

Moroccan housing developer Dar Saada has raised MAD1.1bn ($137m) from a consortium of investors including Kuwaiti private equity firm North Africa Holding Company (NorAH) and Abu Dhabi investment fund Aabar Investments.

The two firms each reportedly account for about a third of the billion dirham capital increase. The remainder comes from Idraj Investment Fund, RMA Watanya and WAFA Insurance.

Dar Saada is a subsidiary of Moroccan real estate business Palmeraie Holdings, and focuses specifically on low and medium income housing.

Kalliopé represented Green Power Partners in this

transaction with a team including partners Tanguy

d’Everlange (corporate), Jocelyn Duval (public law

and contracts), Lorenzo Balzano (real estate) and

associates Camille Jaeglé, Camille Billmann and Cloé

Teisson.Prosolia France was advised by Orrick

Rambaud Martel (Emmanuel Paillard) for the legal

due diligence.

Green Power Partners acquisition of CCE Energies Legal Adviser to Green Power Partners

Kuwaiti fund NorAH invests in Moroccan housing business Legal Adviser to the Purchaser

Financial Adviser to the Equity Provider

Legal Advisor Debt providers

Tax / Structure Adviser

Kuwaiti fund NorAH invests in Moroccan housing business

Financial Adviser to Prosolia France

Legal Adviser to the Debt Providers

El Amari & Associés Legal Advisers to the Vendor Financial Adviser

Legal Due Diligence Provider Property & Plant Valuation Provider

Sixty

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DEAL DIARY

MSREF sells EUR 450m European hotel portfolio Morgan Stanley Real Estate Funds (MSREF) has sold a portfolio of European hotels to Lebanese businessman Toufic Aboukhater for a reported EUR 450 mln.

The hotels were acquired by Morgan Stanley at the top of the market for its MSREF VI fund, which had raised $8.8 bn in 2006. The fund bought the Danube portfolio including seven Intercontinental hotels for EUR 634 mln, using roughly EUR 450 mln in debt provided by Barclays Capital.

This project required a large amount of Due Diligence materials and very tight timelines especially during the final weeks and Merrill DataSite worked 24/7 to meet the timelines so that the deal could be signed accordingly.

Merrill Datasite represented the

Seller and has a longstanding

relationship with all the advisors on the project. Merlin Piscitelli, Sales

Director led the deal team.

www.datasite.com

eBay acquires Turkish Marketplace GittiGidiyor

eBay has executed an agreement to acquire Turkish auction marketplace GittiGidiyor.

The deal follows eBay’s acquisition of a minority stake in the company in 2007.

With the new investment, eBay will own approximately 93% of the outstanding shares of GittiGidiyor following the Turkish Competition Board approval.

Terms of the deal were not disclosed.

Launched in, 2001, GittiGidiyor has more than 6.4 million registered users. The business also includes a mandatory escrow service for payments between buyer and seller. GittiGidyor’s largest categories are Fashion and Consumer Electronics. In addition to eBay, the company previously raised capital from iLab Ventures, founded and led by Mustafa E. Say. Gözde Esen Sakar partner of Bener Law Office led the team representing eBay. It was a long and complicated process due to the shareholders’ rights and transfer restrictions arising from the existing Shareholders Agreement and with the help of the intensive negotiation phase, all selling shareholders and the purchaser reached a common solution!”

Paksoy Law Firm represented majority of the selling

Financial and Tax Adviser to the Vendor

Guzman Gastronomía initially operated in the Boquería food market in Barcelona, selling and distributing fresh produce and gourmet food for hotels and restaurants.

The company reached sales of €37m in 2010, up from €20m in 2005.

Since being acquired by Nazca, the company has opened new facilities in Mercabarna, and opened an operations centre in Madrid. Guzman now offers over 3,500 products for more than 2,500 clients across Spain.

As in most MBOs, the most sensible challenge faced in completing the deal has to do with the conflicts of interest the management team normally has in this type of deals, as in the beginning they’re sellers and from some point on these process they become buyers as well. It’s necessary to have long experience in MBOs to overcome the conflicts of interests without jeopardising the deal.

AC represented the management team,

Firm represented iLab Holding AS and Mustafa

relationship with some members of the

Erhan Say as the minority selling shareholders on the

Legal Adviser to the Vendor

Miura Private Equity has backed the management buyout of Guzmán Gastronomía, a Spanish company dedicated to preparation and commercialization of food products.

shareholders comprised of Turkish individuals, with

a team led by partner Elvan Aziz. Pekin & Bayer Law

Morgan Stanley Real Estate Funds (MSREF) disposal of a portfolio of European hotels

Guzman MBO

deal. Deniz Altınay, partner led the team.

eBay acquisition of GittiGidiyor

Legal Adviser to the Purchaser Financial and Systems Due Diligence Provider Legal Advisers to the Vendor

Property Valuer

reinforcing a long-standing working

management team. Jordi Blasco, partner

at ARS CORPORATE (AC), led the team on the deal.

Miura Private Equity backs Guzmán Gastronomía MBO Legal Adviser to the Purchaser

Legal Adviser to the Equity Provider

Financial Due Diligence Provider

Legal Adviser to the Vendor

Taboglu Law Firm Financial Adviser to the Vendor

Virtual Data Room Provider

Vendor Due Diligence Provider

Sixty One

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DEAL DIARY

AlpInvest, Alpha PE acquire Hans Anders Group from Gilde

Dutch fund of funds investor AlpInvest and European mid-market buy-out house Alpha Private Equity are to acquire Hans Anders Group, a Netherlands-based glasses retailer, from Gilde and Comnaar Investments.

As a long-standing relationship bank to Hans Anders, ABN AMRO, together with the other banks, was quick to cater for Alpha’s requirement to back their offer for the company.

After having obtained exclusivity, a mere timeframe of two weeks was needed from term sheet to fully signed documentation which evidences all parties’ cooperative stance towards successful closing of the deal.

ABN AMRO acted as MLA in the deal and was

represented by Marco Bekhuis (Executive Director)

and Laurens van Wissen (Associate Director) of the

Acquisition and Leveraged Finance department.

Thanks to the cooperative attitude of Alpha and AlpInvest the transaction process has been very pleasant. It was a great challenge to negotiate a similar or even better deal this time.

Onno Boerstra led the Van Doorne team that advised the Hans Anders management in the sale of their

participation and the subsequent renewed

participation in Hans Anders, assisted by Mariken

van Esch, an associate.

AlpInvest, Alpha PE acquisition of Hans Anders Group Debt Providers

Finatem acquires majority stake in Herzog AG Finatem has acquired a majority 75% interest in Herzog AG based in Schramberg (in the Black Forest in Germany).

As part of the solution developed to enable founder Helmut Herzog to pass on the business to a new generation, previous coshareholders Hanspeter and Markus Herzog have retained an interest and new managers have also taken a stake, now collectively totalling around 25% of the shares.

Herzog AG was introduced to Finatem as a specialist manufacturer of milled and lathe-turned components for applications in numerous branches of industry with a workforce of around 400 employees. With sales up almost 30% last year at EUR 48.9 million, Herzog AG has consistently exploited opportunities for growth and continued to strengthen its customer base.

Finatem will now work with the management to develop the company’s position not least in the international markets.

Founded in 1958, Herzog AG manufactures parts such as precision turnings, drive system elements and transmission component kits as well as complex system solutions on a contract basis for customers in a wide variety of sectors ranging from power tools to cycles.

The client list includes prominent blue chip companies.

Finatem acquires majority stake in Herzog AG

Legal Adviser to the Purchaser and Vendor Legal Adviser to the Equity Provider

HusCompagniet acquired

FSN Capital III has acquired HusCompagniet - Denmark’s leading producer of single-family homes. The Company has developed a proven conceptualised business model based on lean processes, uniform principles, a standardised outsourcing model and a structured, guided sales process.

Today, HusCompagniet has an 18% market share. In 2010, HusCompagniet had a turnover of approx. 1 billion Danish kroner with an EBITDA (earnings before interest, tax, depreciation and amortisation) of 101 million Danish kroner. In comparison to the previous year, turnover increased by 26% and profit by 15 %.

‘HusCompangiet has demonstrated its ability to remain profitable and increase market share significantly during the general slowdown in the housing construction market. The Company has built a strong brand by delivering high quality single-family houses with great value for money.

Together with its strong management team we are ready to develop the company further,’ says Thomas BroeAndersen, partner at FSN Capital in Copenhagen.

FSN Capital III acquisition of HusCompagniet Legal Adviser to the Purchaser/ Equity Provider Financial Adviser to the Purchaser/Equity Provider

Commercial, Financial and Tax Due Diligence Provider

Financial Adviser to the Vendor

Risk & Insurance Due Diligence Provider

Vendor Due Diligence Provider/ Tax Adviser

Environmental Due Diligence Provider

Commercial Due Diligence Provider

Sixty Three

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DEAL DIARY

XAnge et al. inject €700,000 in Kiss Kiss Bank Bank

Xange Private Equity and two business angels have invested €700,000 in French crowd funding website Kiss Kiss Bank Bank.

XAnge had already provided the business with €750,000 of seed funding in 2009. The fresh capital will enable Kiss Kiss Bank Bank to pursue its strategy of diversification into a wider range of cultural projects.

Funds for this latest investment were drawn from the La Banque Postale Innovation 4 and 6 FCPI vehicles.

XAnge chose to renew its commitment to Kiss Kiss Bank Bank given the company's progress since inception, notably in terms of diversification.

Migueres & Moulin acted on behalf of Vincent Ricordeau, founder of KKBB on the deal. Emmanuel Moulin as partner of the M&A department and Valérie Bensoussan, as senior associate in such department led the team.

American fund ContourGlobal buys Enel Maritza East 3

Enel S.p.A. has reached an agreement with American investment fund ContourGlobal LP for the sale of the Bulgarian thermal power plant Enel Maritza East 3, the Italian company said.

Maritza East III Power Holding BV and Maritza O&M Holding Netherlands BV, both of which hold 73% of the share capital, respectively, in the Bulgarian power generation company Maritza East 3 AD and the Bulgarian O&M company Enel Operations Bulgaria AD Finalising the deal was quite challenging, as it represented a significant investment for ContourGlobal (installed generation capacity will increase by 70%), and certain peculiarities of the asset and of the regulatory framework required to be properly addressed from a valuation and documentation point of view.”

Djingov, Gouginski, Kyutchukov &

Velichkov participated as a local Bulgarian counsel to CountourGlobal LP in relation

to the mentioned deal. Milan Pandev, the

relevant partner in charge of the firm’s energy &

utilities practice, has leaded the team of Bulgarian

lawyers who worked on the transaction.

Lazard acted as financial advisor to ContourGlobal; this was the first transaction on which they assisted them,

though Lazard had historical relationships with its

shareholders and top managers. The Lazard team was led by Marco Samaja, CEO of Italy, and Alberto

XAnge et al. injects €700,000 into Kiss Kiss Bank Bank Legal Adviser to the Equity provider

Legal Adviser to the Vendor

Giordano, Head of Italian Utilities.

American fund ContourGlobal acquisition of Enel Maritza East 3 Financial Adviser to the Purchaser

Legal Advisers to the Purchaser

Financial Adviser to the Vendor Legal Adviser to the Vendor

BRS Tax Adviser

Sixty Four

Cerberus bags EUR 1bn portfolio from METRO shareholders

US private investor Cerberus Capital Management (Cerberus) has completed the acquisition of a real estate portfolio consisting of 45 METRO Cash & Carry properties in Germany from the three major shareholders of Metro, Franz Haniel & Cie, Otto Beisheim and the Schmidt-Ruthenbeck family.

Ashurst advised the affiliates of Cerberus Capital Management L.P. on the deal.

Ashurst advised with a team led by partner Peter Junghänel and senior associate Marc Bohne (both real estate, Frankfurt).

SRZ assisted Cerberus and its affiliates in connection with US and cross-border issues, including structuring, tax planning and anti-trust. In addition, SRZ advised Cerberus and German co-counsel on legal issues related to both the sale-andleaseback transaction with Metro Cash & Carry and the related syndicated financing.

SRZ is Cerberus’ longtime principal outside counsel. Robert Loper, partner in the Business Transactions group, assisted

by Alan Waldenberg and Sander Ross (Tax).

Orrick advised the owners of the 45 Metro Cash & Carry properties. Orrick advised with a team led by partner Norbert Impelmann (Real Estate, Berlin) and partner Oliver Duys (M&A, Düsseldorf).

Cerberus Capital Management acquisition of EUR 1bn real estate portfolio Financial Adviser to Cerberus

Legal Advisers to Cerberus

Legal Adviser to METRO shareholders

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DEAL DIARY

Goodrich Corporation acquires Microtecnica Goodrich Corporation (NYSE: GR) has signed an agreement with SSCP Aero Holdings S.C.A., a company backed by the European private equity firm Stirling Square Capital Partners, to acquire Microtecnica S.r.l.

Total cash consideration for the acquisition is approximately 330 million Euros ($462 million at an exchange rate of 1.40), reflecting a multiple of approximately 11.5 times 2011 estimated adjusted earnings before interest, taxes, depreciation and amortization (EBITDA).

The acquisition is expected to be slightly accretive to earnings in 2011, including the impact of purchase accounting adjustments, and solidly accretive thereafter.

Our knowledge of this complex sector was key to provide comments on historical data and projections. Our prior knowledge of MT gained on the buy side due diligence for SSCP, was important to explain the significant improvement actions that management has put in place during the last 3 years.”

KPMG acted as financial vendor due diligence

Doughty Hanson to sell Norit’s Clean Process Technologies division to Pentair

Doughty Hanson, one of the largest independent private equity groups in Europe, has announced that its portfolio company Norit has entered into a definitive agreement to sell its Clean Process Technologies (CPT) division to Pentair (NYSE: PNR) for €503 million.

Following the divestment of CPT, Doughty Hanson will continue to own the majority stake in the Norit Activated Carbon business which has operations in both Europe and the US and accounted for over 60% of Norit’s Group EBITDA in 2010.

Houthoff Buruma, along with Doughty Hanson’s international counsel, Skadden Arps, has a longstanding relationship with Doughty Hanson and several of its portfolio companies, including Norit.

Houthoff Buruma represented the seller in this deal,

with Alexander Kaarls leading the team.

Arthur D. Little has a long standing experience in commercial due diligence assignments in the water and clean tech sectors.

Arthur D. Little performed an extensive commercial vendor due diligence on behalf of Doughty Hanson,

including individual buyer synergy assessments.

provider for SSCP on the deal. Paolo Mascaretti,

Martijn Eikelenboom, Managing Director Arthur D.

assisted by Tayfun Pisirir, senior Manager TS.

eikelenboom.martijn@adlittle.com

Partner TS and Head of Private Equity led the team,

Goodrich Corporation acquisition of Microtecnica Legal Adviser to the Purchaser

Legal Adviser to the Vendor

Little Netherlands led the team.

Pentair acquires Clean Process Technologies (CPT) division for €503m Legal Adviser to the Purchaser

Orex Minerals Inc. has entered into an agreement with Northland Resources S.A. to acquire the Barsele gold project in Sweden.

Orex Minerals Inc. was advised by Mannheimer Swartling in the transaction. The firm’s team was led by Martin Ericsson.

Pareto Securities AS (“Pareto”) assisted Northland Resources S.A. “(Northland”) on their sale of the Barsele properties to Orex Minerals Inc. Managing the transaction for Pareto was Corporate Finance Advisor Mr. Kris Gram. Pareto has a longstanding client relationship with Northland since Northland’s secondary listing on the Oslo Stock Exchange in 2006. Pareto’s role in the successful sale included developing a teaser, identifying and contacting possible buyers, managing a structured sales process, evaluating offers and negotiations.

Bird and Bird acted on behalf of long term client, Northland Resources, providing legal advice on the deal. Jim Runsten, partner and Head of International Mining Group led the team, assisted by Hans Svensson, partner at corporate group.

Orex Minerals acquires Barsele gold project from Northland Resources S.A Legal Adviser to the Purchaser

Legal Adviser to the Vendor

Financial Adviser to the Vendor

Financial Adviser to the Purchaser

Vendor Due Diligence Provider

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Tax Adviser

Orex to acquire Barsele gold project

Commercial Due Diligence Provider

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Financial Adviser to the Vendor

Sixty Five

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DEAL DIARY

KBC sells Novaservis for 25%+ IRR

Eneco acquires Oxxio from Centrica

Wendel acquires 95% share in Parcours

KBC Private Equity has sold Czech bathroom fittings maker Novaservis a.s. in a €48m trade sale to Polish business Ferro.

Dutch energy company Eneco and the British Centrica have reached agreement on the acquisition of Oxxio for an amount of € 72 million. This acquisition supports Eneco’s objective to expand its renewable supply portfolio that with 426,000 new customers, or 750,000 connections, now grows to 2.1 million customers.

There will be no changes for Oxxio customers.

French private equity firm Wendel has acquired a 95% stake in French vehicle leasing specialist Parcours from Atria Capital Partners.

Eneco's strategy focuses on the supply and generation of renewable energy and sustainable solutions. The acquisition of Oxxio enables Eneco to realize a further growth of its supply company and, as such, fits in well with its strategy.

Advention brought in a team which worked closely together along with the Wendel investment team. In addition to extensive data collection, intensive discussions where held with high profile market and regulatory experts.

Advention also designed a fairly complex market and business model to support the scenario building.

The deal had a complicated financing structure and required to refinance existing debt. This was a challenge for all parties and added to the complexity of the transaction documentation. On the legal side, our role was to ensure that KBC Private Equity achieves a good deal in a smooth transaction process.

Havel, Holásek & Partners advised KBC Private Equity on all legal aspects of the sale process,

including the final transaction documentation and

transaction completion.

The team was led by senior partner Robert

Nešpůrek and partner Ivan Barabáš. robert.nespurek@havelholasek.cz

We are pleased to complete this assignment and deliver to our client.

We managed to maximize the exit value and helped to create the strongest regional mixers and bathroom accessories producer.

Houthoff Buruma acted on behalf of Dutch energy company Eneco on the deal. The M&A team was led by Michiel Pannekoek (Partner) and Michiel Bruinzeel (Counsel).

The Dewey & Leboeuf team of lawyers

that were involved in this transaction

were led by Pierre FRANCOIS (senior associate) who has been representing

Wendel on several other transactions over the past

two years.

Advention represented the buyer, Wendel, and lead the

strategic due diligence on the deal. The team was led by

Alban Neveux, the Managing Director of Advention,

along with Charif Beainy, Senior Manager.

Eight Advisory, as independent expert,

Patria advised KBC PE, the majority

performed the valuation of the

shareholder of Novaservis, on their

Management Package. The team was led

equity interest disposal process. Petr

by Martine Glineur, head of valuation

Formanek, executive director, Zuzana

practice at Eight Advisory

contact@8advisory.com

Drlikova, director and Olga Schwarzova,

www.8advisory.com

associate co-led the team of Patria, the leading

Czech equity house. Patria advised KBC PE on

acquisition of Novaservis back in 2006, also.

formanek@patria.cz

Ferro acquisition of Novaservis a.s. for €48m Legal Adviser to the Purchaser

Legal Adviser to the Debt Providers

Eneco acquisition of Oxxio from Centrica Legal Adviser to the Purchaser

Financial Due Diligence Provider

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Financial Adviser to the Vendor

Sixty Six

Financial Adviser to the Vendor

Vendor Due Diligence Provider

Wendel acquisition of 95% share in Parcours Legal Adviser to the Purchaser/Equity Provider

Financial Due Diligence Provider

Risk & Insurance Due Diligence Provider Commercial Due Diligence Provider

Valuation of Management Package

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DEAL DIARY

Phones 4u acquired Private equity firm BC Partners has acquired buy mobile phone company Phones 4u from Providence Equity Partners, eyeing value in the growing smartphone market.

The firms, who expected the deal to close next month, did not disclose how much BC Partners paid for the 500store Phones 4u business.

Phones 4u, which supplies all major network and handset brands, posted 2010 sales of over 900 million pounds, representing growth of over 20%. tim.cook@occstrategy.com

Thesan buys Pizza Marzano from TDR

WHEB Partners backs Resysta International MBO

Buyout house Thesan Capital has acquired Pizza Marzano from private equity firm TDR Capital and Capricorn Ventures International as part of a management buy-in.

WHEB Partners has invested in the management buyout of Resysta International, a producer of alternative building materials, from Münchener Boulevard Möbel Joseph Duna.

Thesan, which injected €13m in exchange for a 100% stake, plans to pursue expansion and consolidation opportunities for the Spanish restaurant chain across the Iberian Peninsula in the coming years. The investor's offer was enhanced by its experience in the food sector, while the deal itself was enabled through preexisting contacts between Thesan executives and the vendors.

Resysta has developed a hybrid fibrereinforced material made from around 60 per cent rice husks, 22 per cent rock salt and around 18 per cent petroleum.

The material is environmentally friendly, recyclable and is resistant to external influences such as sun, rain, snow or salt water. It is also contains no elements of wood.

Company-specific characteristics that attracted Thesan include the prestige of the Pizza Marzano brand and its status as the largest firm (with regards to number of outlets owned) within a sector which the private equity firm believes has strong potential over the next few years. It therefore sees the company as an excellent platform to facilitate Thesan's own expansion into the restaurant segment.

Continuing our successful relationship with WHEB Partners over recent years, the work by Coller IP included critical patent attorney reviews and status-checking of the Resysta patents, a review of the third-party patent landscape in related technology areas, and drew on our extensive skills and experience of technical, legal and commercial matters.

The Coller IP team, led by Jim Asher

(COO and founding partner), worked closely with Alex Domin at WHEB

Partners to provide IP analysis and due

diligence in connection with Resysta technology.

Private equity firm BC Partners acquisition of Phones 4u

Legal Advisers to Management Team

Buy-side Due Diligence Provider

Thesan Capital acquisition of Pizza Marzano Legal Adviser to the Purchaser

Legal Adviser to the Vendor Financial Adviser to the Vendor

WHEB Partners backs Resysta International Management Buy Out

Legal Adviser to the Equity Provider

Intellectual Property Due Diligence provider to the Equity Provider

BES Financial Due Diligence Provider

Commercial Due Diligence Provider

Risk & Insurance & Financial Due Diligence Provider

Pensions and Actuarial Adviser

Intellectual Property Due Diligence provider to the Equity Provider

Legal Adviser to the Vendor and Management Team

Sixty Seven

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DEAL DIARY

Rated People investment

Frog Capital, the growth investor, has announced its £3 million investment in Rated People, the UK’s leading online service connecting homeowners with quality, local and recommended tradesmen, based on reviews and ratings from other homeowners in the Rated People community.

Last year, Rated People generated £7 million in revenue, was profitable for the third year in a row and led the market by generating more than £500 million in home renovation and repair business for tradesmen using its service.

Frog Capital was advised on this investment by Wragge & Co. and Craig Corporate. Rated People were advised by Rohan & Co. and FirstCapital.

I was responsible for overseeing the detailed and complex due diligence process and negotiating the terms of the various investment agreements to ensure our client received maximum protection. A transaction of this magnitude involved considerable restructuring of the company’s shareholding and corporate documentation, the detail of which remained my responsibility.

Rohan & Co Solicitors represented Rated People

Limited. Rupert Rohan, the senior partner of Rohan & Co Solicitors, coordinated and managed this

investment transaction.

Frog Capital invests £3 million in Rated People

Legal Adviser to the Equity Provider

Financial Adviser to the Equity Provider

Innova 31 participates in €750k round for Som Biotech

Spanish start-up company Som Biotech has received an investment of €750,000.

The round involves six unnamed business angels, the local government as well as venture capital fund Innova 31, which has taken a 19% stake in Som Biotech.

The funding round requested by SOM BIOTECH S.L. was developed by two linked entities; firstly through KIM Invest S.L.U. who carried out activities of search and contact with private and institutional investors as well as writing the agreement of assignment of Intellectual Property Rights. Mrs. Itziar Escudero, Mrs. Carme Casteras and Mr. Martí Dalmases led the team.

Whilst the second entity LEITAT TECHNOLOGICAL CENTRE carried out activities of legal advice writing the report of the due diligence and other legal documents to execute the entry in the share capital by the investors. Mr. Oriol Pla (Corporate Lawyer) and Mrs. Anna M. Santaularia (External Corporate Lawyer) led the team.

Bridgehead International Ltd advised on strategic choices and implementation on the deal, reinforcing a long standing relationship developed by Tim Fitzgerald and Dr Fiona Paton with Raul Insa in this and his previous companies such as ISDIN. David Alcraft, Chairman, led the team. info@bridgehead.com

Innova 31 participates in €750k round for Som Biotech Legal Adviser to the Equity Provider

Financial Adviser to the Equity Provider

Legal Adviser to the Vendor Legal Adviser to the Vendor

Financial Adviser to the Vendor

Sixty Eight

Acquisition of expatriate information and events business

Centaur Media plc (Centaur), the leading business information and events group, has acquired 100% of the shares in expatriate information and events business, The Forum for Expatriate Management Ltd (FEM), for the sum of £2.5 million paid in cash on completion and a further payment in cash subject to FEM's profits in the 12 months ending June 2013. The total purchase price will be capped at £6.75 million.

Geoff Wilmot, CEO of Centaur commented: "FEM is an excellent fit with Centaur and I am delighted to welcome Brian Friedman (Founder and CEO of FEM) and his team to the Group.

The key to the process’ success was developing a business plan that communicated the value of the business clearly to buyers, and then staying very close to the preferred bidders during the negotiation to persuade them to pay a material amount up front for a two-year old company.

Cairneagle Associates acted as the sole

financial advisor to the shareholders of

Forum for Expatriate Management. The team was led by Rupert Barclay,

Managing Partner at Cairneagle.

Centaur Media plc acquires The Forum for Expatriate Management Ltd Financial Adviser to the Purchaser

Legal Adviser to the Vendor

Strategic Adviser

Commercial Due Diligence Provider

Financial Adviser to the Vendor

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DEAL DIARY

Pinebridge investment in Ulusal Faktoring Pine Bridge Investments has announced that its PineBridge Gateway Partners private equity team has signed an investment agreement to partner with Ulusal Faktoring A.S. (“Ulusal” or the “Company”), a non-bank financial services company in Turkey.

Pinebridge Gateway Partners invests across Turkey, Middle East, Africa, and Russia.

In this respect, the transaction documents were drafted in a manner to make the corporate governance principles of the Target Company more transparent and to develop cooperation between the parties. Moreover, Esin Law Firm’s sensitive and innovative approach to comply with the strict regulations concerning the factoring sector in Turkey was also key component of success in such a deal.

Esin Law Firm, as one of the most

reputable Turkish law firms in the

field of M&A, has advised its long-

standing client, PineBridge Capital

Gateway Partners on the deal. Dr. Ismail G. Esin has led the team in Esin Law Firm. He is the

naming partner and founder of the firm.

AU Advisory has advised Pinebridge Investments

on the financial issues of the deal, with Alper Uyar leading the financial team.

info@esin.av.tr

Pinebridge investment in Ulusal Faktoring Legal Adviser to the Purchaser

Twin Filter merger

Velcon Filters, LLC, a niche manufacturer of industrial filtration systems has acquired Twin Filter B.V. as part of the company’s expansion plan to offer their products into upstream markets.

Due to the cross border nature of the transaction the main legal challenge was to get the purchaser comfortable with Dutch legal concepts.

Another complicating factor was that not all sellers were participating in the ultimate holding company of the target group (i.e. various sellers were participating at a lower level in the group).

JanssenBroekhuysen Advocaten acted for the selling shareholders of Twin

Filter and GSF, with Pieter Janssen

leading the team.

ABN AMRO Corporate Finance was retained exclusively as financial advisor to assist the seller in the proposed sale process following an ongoing strategic dialogue. The close relationship between Twin Filter and ABN AMRO will be continued with the company remaining a highly valued client of ABN AMRO. ABN AMRO Corporate Finance acted as financial

advisor, with Hans de Lange, Executive Director

Financial Adviser to the Vendor

Commercial Due Diligence provider

H.I.G. Europe, the European arm of global private equity firm H.I.G. Capital, has led the recapitalization via a consensual restructuring of the industry- leading German call center operator Walter Services Holding GmbH ("Walter Services"). The former shareholder consortium, led by Odewald & Cie., will hold a small coinvestment after closing. H.I.G. Europe is now the majority shareholder of Walter Services. Anchorage Capital is also an investor in the transaction.

The closing of the transaction is subject to antitrust and German bank authority approval. The acquisition of Walter Services marks H.I.G. Europe’s eleventh new deal investment in the last 12 months and fifth since the start of 2011.

Walter Services was founded in 1978 and has approximately 8,000 employees. With revenues of € 200 million, it is the second largest provider of business process outsourcing strategies in Germany, offering customized consulting and industry specific customer service and sales concepts for the sustainable improvement of customer relationships.

leading the team.

Velcon Filters, LLC acquisition of Twin Filter B.V Legal Adviser to the Purchaser

Financial Adviser to the Purchaser Financial Due Diligence Provider to the Purchaser

H.I.G. Europe Recapitalizes Walter Services Group

H.I.G. Europe recapitalizes Walter Services Group

Legal Adviser to the Equity Provider

Debt Provider

Financial Adviser to the Vendor

Legal Adviser to the Debt Provider

Legal Adviser to the Vendor

AU Advisory Sixty Nine

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WPP acquisition of Who Digital

Judicium takes over UK Work Permits

Equitrust acquires the WEGU Group

WPP has acquired the business of Who Digital, the leading full service digital agency in Vietnam, subject to regulatory approvals. Who Digital and OgilvyOne in Vietnam will form a joint venture in which WPP will take a majority stake.

Judicium has taken over UK Work Permits, a London-based corporate immigration consultancy. Judicium will pay £300,000 immediately in cash plus a sum equivalent to the cash within the business, and £131,250 one year following the completion of the transaction.

Equitrust has acquired WEGU Group, a supplier to Germany's roaring automotive industry, as it enjoys a postcrash rebound due to a demand for imports.

WEGU makes various parts, including vibration absorbers, dashboard components, mud flaps, and floor mats for use in cars produced by other manufacturers.

Founded in 2005, Who Digital employs 25 people and is based in Ho Chi Minh City.

Clients include Unilever, Megastar, HSBC, Baoviet and Sony Ericsson.

Who Digital’s unaudited gross assets as 31 December 2010 were VND 13.8 billion.

“The main challenge of the transaction was the deal structure, as the on earn-out payment was complex. We remedied this by clarifying and developing a provable financial model for future earnings, which maximize the realistic future value of our client”, said Mr. Tom Doan, Chairman and Managing Partner of Horizon Capital Advisers, which represented WHO Digital in this transaction. kdoan@horizoncapitalvietnam.com

Judicium will pay a bonus of £37,500 if UKWP achieves a pre-tax profit of £150,000 or greater in the financial year ending 31 March 2012.

UKWP MD Paul Taylor will remain with the business for a minimum period of three months to supervise the integration and all other staff will remain in their existing roles.

Lubbock Fine was appointed by its existing client, Judicium PLC, to undertake the financial due diligence of UK Work Permits Limited. In addition to the due diligence work, I attended the completion meeting to provide significant input on the definition, clarification and agreement of various finance related items included in the share purchase agreement and associated documents.

Germany is the world's fourth-largest motor vehicle exporter and last year experienced growth of 23 per cent, with 4.2 million units produced for sale abroad. WEGU posted record turnover in 2010, clocking up sales of €40m.

MSM Capital used all its international experience to support the development of a reliable growth story in the currently negative automotive industry environment.

Dr. Matthias Dittmar, Managing Partner

MSM Capital acted on behalf of Equitrust as

longstanding partner for commercial due diligences.

md@msmcapital.com

Lee Facey (partner) led the financial due

diligence team.

WPP acquisition of Who Digital

Financial Adviser

Judicium acquires UK Work Permits

Legal Adviser to the Management Team

Legal Adviser Financial Due Diligence Provider

Equitrust acquires the WEGU Group

Legal Adviser to the Vendor Dr. Böhmer, Bethmann & Partner Tax Adviser

Environmental Due Diligence Provider

Commercial Due Diligence Provider

Seventy

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Private Equity and M&A Law Firm of the Year 2011 for Nordic ACQ GLOBAL AWARDS

www.kalliolaw.fi

Finding Solutions Getting Results Kalliolaw Asianajotoimisto Oy – Attorneys at Law Eteläranta 12, FI-00130 Helsinki Tel +358 9 6812 930, Fax +358 9 6812 9320 firstname.lastname@kalliolaw.fi www.kalliolaw.fi

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