ISSUE 10.5
Renewable energy
Private equity fills the capital gap
Offshore law firms
Why further consolidation beckons
Islamic finance
Not just for Middle East
Japan Special Report:
Ready to rebound Lateral moves
Deals Roundup
Region-wide updates
debt & Equity market intelligence
www.legalbusinessonline.com
EDITORial >>
The younger generation: cause for celebration? IN THE FIRST PERSON
S
everal senior partners who are regular attendees at the ALB Law Awards currently underway around the region have noted that each year they’re seeing not only their ‘old’ friends but also a growing number of younger lawyers taking part in the legal industry’s most prestigious series of events.
“Younger lawyers – who are mostly in their 30s – have become an increasingly important force in the legal industry. As the legal and regulatory environment has been changing at an unprecedented rate and magnitude, they appear to be most skilled at learning new things and adapting to the changes,” said one senior partner at the recently held ALB China Law Awards 2010. Senior partners at Jun He, like many other firms in China and other countries around the region, are promoting a growing number of younger lawyers to partner ranks. Currently, thirty-something lawyers account for nearly 50% of the firm’s 95 partners and counsel, up 20% from just two years ago. “Younger lawyers are contributing significantly to business development. They have stronger teamwork ability and a stronger focus on specialised areas of law, so they will contribute to the firm’s further integration and modernisation,” said David Liu, Jun He’s senior partner. Of course, older lawyers will still sometimes make comments about the younger generation, especially those under 30, not fully appreciating the concept of hard work, loyalty and client service. Yet each generation has its unique culture and values. At their core, young lawyers require constant opportunities to learn and challenging work – and they want to be proud of what they do. Young lawyers of today will drive the legal world of tomorrow, a world which is likely to be vastly different from today. Most of the change will be positive.
“It’s tough to say but we hope
there will be further large-scale IPOs. In Japan the IPOs that are big enough to include a global component are small in number but I hope more deals will happen in the typical listing season...” Alan Cannon, Simpson Thacher & Bartlett (p6)
“Feedback from potential clients
was that it was impossible for them to send quality work to a solo practice... I needed to be in a larger law firm” Bryan Ghows, TSMP (p22)
“Indonesia is a country with a population of almost 300 million and is untapped for Islamic finance. It is practically unknown there” Amir Fazael Zakaria, AirAsia (p56)
At their core, young lawyers require constant opportunities to learn and challenging work – and they want to be proud of what they do
www.legalbusinessonline.com
1
News | deals>> >> CONTENTS
contents 30 COVER STORY
ALB Special Report: Japan 2010 Despite lingering economic difficulties and political uncertainty, things are looking positive for the legal services market. Both local and international law firms are eager to position themselves for when transaction levels pick up
NEWS ANALYSIS
FEATURES
8
38 Offshore law firms Despite taking a beating from regulators during the financial crisis, offshore financial centres have bounced back to help lead the global economic recovery. The signs are equally as positive for the offshore legal services market, which is set to undergo yet another round of consolidation in the year ahead
Private equity goes green Deals in Asia’s renewables sector may be flowing, but their small size often leaves a capital gap that needs to be filled. Can PE and VC be to renewables in Asia what it was to dot. coms in the Silicon Valley?
10 The total lawyer ALB looks at Simmons & Simmons’ initiative of sending junior lawyers on an MBA course in legal practice and asks whether this is the start of a trend to build ‘the total lawyer’? 12 Insolvency work: restructuring with a small ‘r’ While the predicted surge of insolvency work after the GFC never materialised in Asia, disappointed insolvency lawyers in the region still have reason to be cheerful
50 Australian law firms in Asia Australian law firms have been in Asia just as long as some of their US and UK counterparts but their practises have not been graced with the same levels of success. ALB looks
at the road ahead for Australian firms in Asia and suggests that success may lie with diversification 54 ALB’s Leading Islamic Finance Law Firms: Asia In-house lawyers, bankers and industry experts single out the leading Islamic finance law firms across three jurisdictions in Asia: Malaysia, Indonesia and Singapore
Regulars 4
DEALS
14 NEWS • ‘Business as usual’ for Thai law firms caught in political unrest • Harry Elias split reflects new market pressures • Clifford Chance swaps Singapore managers • Legal work abounds as CNOOC spreads wings
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46 ALB Japan Law Awards 2010 – the finalists All the finalists at this year’s Japan Law Awards have triumphed over adversity. Here is the complete list across all 24 categories
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NEWS | deals >>
| Singapore/India |
deals in brief
►► Fortis Healthcare– Parkway Holdings acquisition Value: US$658m Firm: AZB & Partners Lead lawyers: Ajay Bhal, Hardeep Sachdeva Client: Fortis Healthcare
HEADLINE DEAL
“This deal illustrates Indian corporates’ appetite for significant and strategic outbound investments. As India’s primacy on the international stage continues to grow we expect to see more of these high-profile acquisitions. The financing also highlights the extent of liquidity in the Indian debt markets” Sanjeev Dhuna, Allen & Overy
| INDIA | ►► Bharti Airtel–Zain (Africa) acquisition Value: US$10.7bn Firm: Herbert Smith Lead lawyers: Michael Walter, Alan Montgomery Client: Bharti Airtel Firm: AZB & Partners Client: Bharti Airtel Susan Wong
Firm: Linklaters WongPartnership Lead lawyer: Charles Jacobs Client: Zain Firm:WongPartnership Lead lawyers: Susan Wong, Choo Ai Leen, Tan Kay Kheng Client: Bharti Airtel
4
acquiring its 15 African mobile networks • Second-biggest overseas purchase by an Indian company; Bharti will be world’s fifth-largest wireless company • Standard Chartered Bank was lead arranger for deal financing – largest ever finance raised for an acquisition by an Indian corporate • AZB previously advised Bharti on its US$23bn failed bid for MTN in September 2009. Linklaters were also previously retained by Zain on its attempted reverse takeover of Paltel • Herbert Smith retained 31 lawyers across twelve practices, from TMT to tax, and worked alongside European alliance firm Stibbe, which was headed by partners Björn van der Klip and Maarten de Bruin
Firm: Allen & Overy Lead lawyers: Sanjeev Dhuna, Karan Singh Client: Standard Chartered Bank
• A&O worked alongside Indian ‘best-friend’ Trilegal, which provided local Indian law advice, led by partner Karan Singh
• Indian telco Bharti Airtel bids US$10.7bn for the African business of Kuwaiti telco Zain,
• WongPartnership acted as Singapore counsel for Bharti Airtel’s raising US$7.5bn from consortium of lenders
Firm: Rajah & Tann Lead lawyers: Goh Kian Hwee, Kala Anandarajah, Evelyn Wee Client: Fortis Healthcare Firm: WongPartnership Lead lawyer: Dilhan Pillay Sandrasegara Client: TPG Capital • TPG Capital sold 23.9% stake in Parkway Holdings to Fortis Healthcare for S$959m, which willbecome one of Asia’s largest hospital networks • Fortis previously retained Indian firm Vaish Associates for its acquisition of Wokhardt in 2009 • Cross-border transaction spanning Singapore, Mauritius and India
| KOREA | ►► Korea Life Insurance Global IPO Value: US$1.6bn Firm: Shin & Kim Client: Underwriters Firm: Davis Polk & Wardwell Lead lawyer: Eugene Gregor Client: Underwriters Firm: Simpson Thacher & Bartlett Lead lawyers: Youngjin Sohn, Kristina Kang, Soo Chung Client: Korea Life Insurance Firm: Lee & Ko Client: Korea Life Insurance • Global offering by Korea Life Insurance of 217 million shares on Korea Exchange • KLI is both oldest and secondlargest insurance company in Korea • Largest Korean IPO since 2006, second-largest IPO in Korea ever, including dual-listed IPOs • Four lawyer team at DP&W, seven
lawyer team from Simpson Thacher retained on transaction
| HONG KONG | ►► SouthGobi Energy Resources IPO Value: US$438m Firm: Skadden Lead lawyers: Dominic Tsun Client: Underwriters Firm: Blakes, Cassels & Graydon Client: Underwriters Firm: Goodmans Lead lawyers: Paul Goodman Client: South Gobi Firm: Dorsey & Whitney Lead lawyer: David Richardson Client: South Gobi • Toronto-listed SouthGobi Energy Resources secondary listing of shares on HKSE • First listing by Canadian mining company on HKSE and the first listing by any Canadian company in conjunction with share offering
| JAPAN | ►► EQT Greater China II–Japan Home centre acquisition Value: Undisc Firm: Woo Kwan Lee & Lo Client: Shareholders Firm: Baker & McKenzie Lead lawyers: Cheung Yuk Tong, Tracy Wut Client: EQT Greater China II
Tracy Wut Baker & McKenzie
• PE fund EQT Greater China II acquires co-controlling stake in discount house-ware retail chain in Hong Kong, Japan Home Centre (“JHC”) • EQT has 40% ownership in JHC while the two founders, Peter Lau and Lisa Ngai, have together retained a 60% stake • Baker & McKenzie advised on documentation and general transaction management Asian Legal Business ISSUE 10.5
NEWS | deals >>
| Saudi Arabia | ►► Kingdom Holding Company–Kingdom Hotel Investments acquisition
►► your month at a glance Firm
Value: US$843m Firm: Dewey & LeBoeuf Lead lawyers: Camille Abousleiman, Simon Briggs Client: Kingdom Holding Company Firm: Linklaters Lead lawyers: Nick Garland, Jeremy Parr Client: Kingdom Hotel Investments Firm: Freshfields Client: Citigroup and Deutsche Bank • US$843m acquisition of Kingdom Hotel Investments by Kingdom Holding Company, owned by Saudi Royal family. KHC already owned 46% and bought out the remaining stake in this acquisition for US$370m • Before it became Dewey & LeBoeuf through 2007 merger Dewey had acted for Kingdom Hotel Investments (target on this transaction) advising on its IPO, first listing on the Dubai International Financial Exchange • Also previously advised KHC in 2007 on its bid for a GSM license • Linklaters acted through its Dubai and London offices
Allen & Gledhill
Firm: Anderson Mori & Tomotsune Lead lawyer: Hironori Shibata Client: Managers Firm: Sullivan & Cromwell Lead lawyer: Izumi Akai Client: Managers Firm: Simpson Thacher & Bartlett Lead lawyer: Alan Cannon Client: Dai-iChi Life
Value Deal type (US$m)
Singapore
Lippo Group loan facility
410 Debt market
Singapore
Singapore Post notes issue
150 Debt market
Singapore
Integrated Media Fund establishment
Singapore
PT Bakrieland Development bonds issue
Singapore
Temasek Holdings' notes series issue
Singapore
Singapore Airport Terminal Services MTN
357 Debt market
Singapore
Ruby Assets exchangeable collateralised securities due 2019
250 Debt market
Singapore
CVC Capital Partners Asia Pacific III–PT Matahari Department Store acquisition
823 M&A
70 PE 155 Debt market Undisc Debt market
Singapore
SingTel Group Treasury issuance of 3% notes 2020
India/Africa
Bharti Airtel–Zain (Africa) acquisition bid
Allens Arthur Robinson
China/Australia
Chinalco–Rio Tinto JV
Anderson Mori & Tomotsune
Japan
Dai-ichi Life IPO
India
Wireless TT Info Services–21st Century Infra Tele acquisition
280 M&A
India/S’pore/Mauritius
Fortis Healthcare–Parkway Holdings acquisition
658 Debt market
India
Hitachi–Telcon stake acquisition
250 M&A
India
SKIL Infrastructure–Pipavav Shipyard stake acquisition
India/Africa
Bharti Airtel–Zain (Africa) acquisition bid
10,000 M&A Undisc Corporate
AZB & Partners
500 Debt market 10,000 M&A 1350 Energy & resources 18,500 Equity market
310 M&A
India
Reliance Industries–Deccan Cargo & Express Logistics investment
Singapore/Thailand
PTT Public Company loan
Hong Kong
EQT Greater China II–Japan Home Centre stake acquisition
China/Australia
Chinalco–Rio Tinto JV
Blakes, Cassels & Graydon
Hong Kong/Canada
SouthGobi Energy Resources IPO
Clifford Chance
Saudi Arabia
Carlyle Group–General Lighting Company stake acquisition
Undisc Private equity
Commerce & Finance
China
China Merchants Bank rights offering
3,200 Equity market
Conyers Dill & Pearman
China
China Lodging Group IPO
Crawford Bayley & Co
India
NMDC stake sale
2,200 Equity market
Korea/US
Korea Life Insurance Global IPO
1,600 Equity market
India/Singapore
Morgan Stanley Infrastructure consortium–Asian Genco investment
425 Energy & resources
China
China Lodging Group IPO
126 Equity market
China
China Merchants Bank rights offering
Saudi Arabia
Kingdom Holding Company–Kingdom Hotel Investments acquisition
Saudi Arabia
Carlyle Group–General Lighting Company stake acquisition
Baker & McKenzie
| JAPAN | Value: US$18.4bn
Deal name
Allen & Overy
Davis Polk & Wardwell
►► Dai-ichi Life IPO
Jurisdiction
Dewey & LeBoeuf DLA Piper
Hong Kong/Korea
Fila Korea note issue
Dorsey & Whitney
Hong Kong/Canada
SouthGobi Energy Resources IPO
Saudi Arabia
Kingdom Holding Company–Kingdom Hotel Investments acquisition
Freshfields
China
China Merchants Bank rights offering
Bahrain
Central Bank of Bahrain international bond issue
Gibson Dunn & Crutcher
Saudi Arabia
Carlyle Group–General Lighting Company stake acquisition
Gide Loyrette Nouel
India
NMDC stake sale
Goodmans
Hong Kong/Canada
SouthGobi Energy Resources IPO
Hariyani & Co
India
Matheson Tri-Gas–K-Air Gases India JV
300 Debt market Undisc M&A/PE 1,350 Energy & resources 438 Equity market
126 Equity market
3,200 Equity market 843 M&A Undisc Private equity 50 Debt market 438 Equity market 843 M&A 3,200 Equity market 1,250 Debt market Undisc Private equity 2200 Equity market 438 Equity market Undisc M&A
Singapore
Develica APS 100 sale
110 Real estate
Firm: Nishimura & Asahi Lead lawyer: Yasutaka Nishikori Client: Dai-iChi Life
Harry Elias Partnership
Singapore
Schlumberger SA–Geoservices SA acquisition
800 M&A
Singapore/China
Eagle Brand Holdings divestment
Hassan Radhi & Associates
Bahrain
Central Bank of Bahrain international bond issue
Herbert Smith
India/Africa
Bharti Airtel–Zain (Africa) acquisition bid
• Dai-ichi Life on Rule 144A and Regulation S offering on Tokyo Stock Exchange
China
China Merchants Bank rights offering
3,200 Equity market
Saudi Arabia
Carlyle Group–General Lighting Company stake acquisition
Undisc Private equity
www.legalbusinessonline.com
Hourani & Associates
80 Corporate 1250 Debt market 10,000 M&A
5
NEWS | deals >>
►► your month at a glance (CONT) Firm
Jun He
Khaitan & Co
Kim & Chang
Lee & Ko
Jurisdiction
Deal name
Value Deal type (US$m)
China
China Lodging Group IPO
China
China Merchants Bank rights offering
India/Japan
Blackstone Group–Jagran Media Network investment
India
NECL–Machilipatnam Port acquisition
India
Hospira–Orchid asset acquisition
India
Shree Ganesh Jewellery House IPO
78 Equity market
India
United Bank of India IPO
72 Equity market
126 Equity market 3,200 Equity market 54 Private equity Undisc M&A 392 M&A
India
KSK Power Ventur AIM listing
Korea
KDB Consus Value PEF–Kumho Life Insurance acquisition
Undisc Equity market 435 M&A
Korea
Eastman Fibers Korea–SK Chemicals acetate asset acquisition
109 M&A
Korea
Inverness–Standard Diagnostics acquisition
Korea/US
Korea Life Insurance Global IPO
190 M&A 1,600 Equity market
India/Africa
Bharti Airtel–Zain (Africa) acquisition bid
Linklaters
Saudi Arabia
Kingdom Holding Company–Kingdom Hotel Investments acquisition
Bahrain
Central Bank of Bahrain international bond issue
Luthra & Luthra
India
GMR Group Maharashtra power project
Nishimura & Asahi
Japan
Dai-ichi Life IPO
18,500 Equity market
Nishith Desai Associates
India
GoAhead Software–Avantellis acquisition
Undisc M&A
Japan/US
Sanei–Kate Spade JV
Undisc Corporate
Japan
Nippon–Dow AgroSciences Tebufenozide Insecticide Business acquisition
Undisc M&A
Paul Hastings
Hong Kong
Intime Department Store share sale
Quays H Zubi
Bahrain
Central Bank of Bahrain international bond issue
India/S’pore/Mauritius
Fortis Healthcare–Parkway Holdings acquisition
658 M&A
Singapore
Yangzijiang–PPL Holdings bid
155 M&A
Orrick
Rajah & Tann Rodyk & Davidson Shin & Kim
Simpson Thacher & Bartlett
Skadden Stamford Law
Sullivan & Cromwell
1250 Debt market 585 Project finance
100 Equity market 1,250 Debt market
Singapore
Yangzijiang–PPL Holdings bid
155 M&A
Korea
KDB Consus Value PEF–Kumho Life Insurance acquisition
435 M&A
Korea/US
Korea Life Insurance Global IPO
China
China Lodging Group IPO
Korea/US
Korea Life Insurance Global IPO
Hong Kong
PFH Partnership–Chapdelaine stake acquisition
Japan
Dai-ichi Life IPO
Hong Kong/Canada
SouthGobi Energy Resources IPO
Singapore/China
China Minzhong IPO
Singapore
Cairnhill Circle development
Hong Kong
PFH Partnership–Chapdelaine stake acquisition
100 Private equity
Japan/US
Union Bank–Tamalpais Bank acquisition
600 M&A
1,600 Equity market 126 Equity market 1,600 Equity market 100 Private equity 18,500 Equity market 438 Equity market 169 Equity market Undisc Construction
Dai-ichi Life IPO
18,500 Equity market
India
Matheson Tri-Gas–K-Air Gases India JV
Undisc M&A
Watson Farley & Williams
Singapore/UK
Standard Chartered Bank–Bibby Offshore loan facility
Hong Kong
Pacific Century Group–AIG investment business acquisition
55 Debt market 500 M&A/PE
Indonesia
PT Semen Gresik sale
Hong Kong
Aegis–Charm Communications investment
50 Corporate
Singapore
Singapore Airport Terminal Services MTN
357 Debt market
India/S’pore/Mauritius
Fortis Healthcare–Parkway Holdings acquisition
India/Africa
Bharti Airtel–Zain (Africa) acquisition bid
10,000 M&A
Woo Kwan Lee & Lo
Hong Kong
EQT Greater China II–Japan Home Centre stake acquisition
Undisc M&A/PE
Zhong Lun
China
China Lodging Group IPO
WongPartnership
1,000 M&A
658 M&A
126 Equity market
Does your firm’s deal information appear in this table? Please contact
6
alb@keymedia.com.au
• Alan Cannon recently advised on Japan’s largest securities offering seen in a decade, MUFJ Financial Group’s US$12bn IPO, and said given the size of this offering may not see any larger this year
843 M&A
Japan
Winston & Strawn
• Hopes pinned on Dai-ichi’s billion-dollar listing to boost market sentiment. Japan’s bourse suffering from a dearth of listings compared to glory days of 6 years ago – according to Dealogic the 20 companies listed last year raised a total of only US$603m
10,000 M&A
Wakhariya & Wakhariya
White & Case
• World’s biggest IPO in 2 years, also largest in Japan since US$18.4bn IPO of NTT DoCoMo over a decade ago
61 2 8437 4700
| BAHRAIN | ►► Central Bank of Bahrain international bond issue Value: US$1.25bn Firm: Freshfields Lead lawyers: Harnek Shoker, Tobias Müller-Deku, Fares Al-Hejailan Client: CBB and Ministry of Finance Firm: Quays Zubi Client: Ministry of Finance Firm: Linklaters Client: Joint lead managers Firm: Hassan Radhi & Associates Client: Joint lead managers • Central Bank of Bahrain (CBB) on US$1.25bn international bond issue – size increased to US$1.25bn to meet investor demand
Harnek Shoker Freshfields
• First bond issue of its size and format in Bahrain, offering marketed to investors in the US, Asia and Europe • Freshfields utilised new Saudi alliance with Fares Al Hejailan, and London offices partners • CBB has been good source of work for Bahrain-based law firms – Hassan Radhi, Trowers & Hamlins and Charles Russell were retained on past deals, latter two as administrators for two troubled local banks in August 2009 Asian Legal Business ISSUE 10.5
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NEWS | analysis >>
Analysis >>
PE goes green Renewable energy is quickly becoming big business for investors, developers and, not least, lawyers across the region. Most countries in Asia, from China and India to Thailand and the Philippines, are expected to invest heavily in renewables over the next five years. But many lack a solid policy framework. This, as well as the typical deal size being smaller, has left a capital gap that needs filling. Private equity and venture capital is becoming the common choice for filling that gap
8
State of the market
T
he last year or so has been a time of immense change for renewables in Asia, spurred on by a seemingly collective regional recognition that greenhouse gas emissions need to be reduced and energy security and independence need to be secured. Most of the region’s biggest economies have made positive inroads in terms of developing sustainable renewable energy policies. “Climate change and the need to reduce greenhouse gas emissions, while achieving developmental goals, are the key drivers for almost all energy markets in Asia,” said Paul Curnow, cohead of Baker & McKenzie’s Asia-pacific renewable and clean energy practice. “More focus has been placed on bringing in renewable energy as a substantial component to meet energy needs.” India and China continue to lead the way in this regard, both in Asia and globally. Both countries are in the world’s ‘top-five’ in terms of the amount of installed renewable energy. “India and the PRC both have a preferential feed-in tariff system in place to drive investment in renewables. Both have tariffs that are higher than the
normal electricity price for coal or gas for a range of renewable energy technologies,” said Curnow. This has meant that wind has become the renewable of choice in both countries. According to the Wind Energy Council, China was ranked third globally for cumulative wind capacity (25,104MW; 15.9% of the global market) while India ranked fifth with current capacity of 10,926MW or 6.9% of global market share. ►► Top global clean-tech venture capital sectors in 2009 Smart grid US$414m
Water US$117m
Solar US$1.2bn
Biofuels US$554m Energy efficiency US$1bn
Transportation (including electricdrive vehicles, batteries, fuel cells) US$1.1bn
Source: Deloitte Asian Legal Business ISSUE 10.5
NEWS | analysis >>
Elsewhere in the region, regulators are also making good inroads bringing their industries up to speed with Asia’s two powerhouse economies. “Thailand has put in place a system of feed-in tariffs, the Philippines has a framework law in place, while Malaysia has said that it intends to bring in something by 2011,” said Curnow. “Indonesia has not formalised a feed-in system at the legislative level but does have tariffs around geothermal projects.”
emanate from the fact that policy frameworks around renewable energy in Asia are still in their infancy. Legal advisers can help their clients understand and therefore minimise the risks, but the other problem – access to capital – is less easily resolved. “Once you move out of China, India and even Australia, project sizes become a lot smaller. When you look at renewable potential in South-East Asia a lot of it is focussed around small hydro,
“The market environment is challenging and the cost of capital has increased dramatically. In addition, the price of oil and natural gas has declined, which makes renewable energy less attractive” Parker Weil, Bank of America Merrill Lynch In a policy-driven area such as renewables, the importance of cogent and workable regulatory frameworks cannot be underestimated. Curnow said the fact that activity here has increased substantially since the turn of the year may indicate that countries in the Asian region have the legislative mix right. “At the moment the market [in Asia] is dominated by utilities that are diversifying their own portfolios. In a lot of countries you have governmentowned utilities looking to build out their generating capacity in renewable. From a financing point of view, a lot of that is on their balance sheets, but is also occurring with a lot of debt financing from local banks,” he said. At the same time a number of boutique renewable energy developers based out of Europe, Japan and Korea, plus big names like Suzlon and Siemens, are entering the renewables markets in Asia. They are making the transition downstream from simply constructing energy technologies such as wind turbines to actual project development. But despite a wealth of companies looking to tap into Asia’s renewable energy sectors, some real challenges to their entry remain. “In terms of project finance, several banks here have been involved in lending across the region but there are still a lot of barriers due to perceived risks and the size of the projects,” said Curnow. These perceived risks ostensibly www.legalbusinessonline.com
biomass, wind and solar. The generating capacity is small, as are the projects from a capital needs point of view,” Curnow said. “Most banks are not really interested in projects less than US$50m, but a lot of these projects only have capital needs of US$5-10m, so there is a gap in terms of getting interested players to come in.” Parker Weil, co-head of the Bank of America Merrill Lynch’s energy and investment banking group, agrees with Curnow’s assessment and said that the financial crisis has also limited the amount of financing available for renewables projects. “The market environment is challenging and the cost of capital has increased dramatically. In addition, the price of oil and natural gas has declined which makes renewable energy less attractive.” Weil also pointed out that the troubles experienced by US banks has impaired their ability to use tax equity financing, once a staple of renewables project finance deals. “Tax equity [the selling of the projected dollar value of tax credits at a discount to finance projects] was
the oil that was lubricating [renewable energy project finance], because it’s low-cost and the financial benefits are easily quantifiable and certain,” he said. “[But] it offsets taxable earnings, so if you can’t use the deduction there’s a problem going forward – one that’s not easily solved.” The expected rate of return on a tax equity investment used to be in the vicinity of 6% but now that it has risen the cost of capital from a project developer’s perspective has increased. “That’s consistent with the cost of capital across industries and investment types. The cost of debt and equity has increased. You need to pay a higher new issue premium and bigger discounts to get deals done,” Weil explained.
PE’s green play
In light of these difficulties, private equity and venture capital’s increasing interest in renewables is opportune. Over the past year, PE and VC investment in this sector was one of the few bright spots for project finance work. Whereas global project finance volumes retreated to Asian financial crisis levels during 2009, PE- and VC-backed project finance deals fared substantially better – so much so that 25% of all these investments in 2009 were in the clean-tech sector. “What we have started to see recently is investment from PE funds,” said Curnow. “If you look at the US and Europe this has been happening for some time now, but because of the substantial growth opportunities on offer in Asia their attention is turning [there].” While this phenomenon is still in its early days in the region, a number of trends are already becoming salient. “Many PE players are looking at making their entry through fund investment rather than into the assets themselves,” Curnow said. “This is usually the case where these PE
“Once you move out of China, India and even Australia, project sizes become a lot smaller. When you look at renewable potential in South-East Asia a lot of it is focussed around small hydro, biomass, wind and solar” Paul Curnow, Baker & McKenzie 9
NEWS | analysis >>
players are new to the sector and don’t have their own large internal teams to do their own analysis on the assets.” Interest also extends to corporate finance. Here, PE and VC players are keen to invest in project developers by taking an equity interest in the companies who are developing the projects and are going to be sitting on generating assets. Legal practitioners tip that both these areas will grow as PE and VC operatives become more familiar with the different renewables markets across Asia, and the quickly changing regulatory regimes underpinning them. “As we see PE players become more familiar with markets in Asia, they should start looking at making direct investments themselves,” Curnow said. “I would suspect that those equity investments would be smaller … perhaps a minority interest placed across a number of different projects across a number of different countries.”
Analysis >>
The legal work
Lawyers note that once investments reach this stage, the issues that come into consideration aren’t dissimilar from those confronting PE and VC investments in any other sector. Yet in reaching this point the role that lawyers have to play could not be more important. Practitioners ALB spoke to are all busy conducting client information seminars, briefings and workshops on investment opportunities, perceived risks, and basic regulatory and policy drivers behind renewables in Asia. Lawyers who have already enjoyed success in this area posit a direct relationship between these client-facing activities and future business. Notwithstanding this, the key for law firms looking to take the lead in this area depends not only on how well they can leverage their pre-existing energy & resources skills and expertise, but also on the extent to which they can serve as a missing link between their clients and projects, developers and financing sources. According to conversations held with industry professionals, those firms which are also able to shepherd ‘green clients’ through the whole process – from regulatory advice and due diligence to project management, post investment and commissioning – will also be in high demand. ALB 10
The total lawyer Simmons & Simmons’ recent announcement that it would defer the start dates for some of its 2010 graduate trainees was not unusual − many of the firm’s international counterparts have announced similar moves to reduce the strain on their budgets in the wake of the financial crisis. More remarkable was the firm’s decision to send some of its ‘class of 2010’ on an MBA program. Indeed this may be the start of moves to build the ‘total lawyer at a much earlier career stage. ALB investigates Asian Legal Business ISSUE 10.5
NEWS | analysis >>
I
n the 1970s, Dutch coach Rinus Michels turned 100 years of football strategy on its head when he devised the concept of “total football” – totaalvoetbal. The sporting concept was simple: each player on the pitch had no nominal role but was instead expected to play as an attacker, midfielder or defender depending on the passage of play. The strategy was so successful that it saw Michels’ team at the time, Ajax Amsterdam, dominate European football and the Netherlands national team come agonisingly close to clinching its first World Cup. The success on offer for law firms who embrace a similar concept could also be great. The total lawyer cannot of course be expected to offer specialist legal advice on all practice areas. The total lawyer should, however, be better able to understand the pressures facing clients. In essence, the total lawyer is one who is best able to also play the role of the client.
The total lawyer
Earlier this year London-based international firm Simmons & Simmons paired up with Londonbased educational provider BPP Business School to launch an MBA (Legal Services) course specifically tailored to lawyers. The one-year course is designed to create “firstrate, commercially astute lawyers capable of offering legal advice based on an understanding of the business context.” In other words, to give Nick Benwell young lawyers a deeper Simmons & appreciation of the Simmons real-world financial pressures acting on their clients. “The MBA will give our future trainees a great headstart in terms of gaining commercial business skills, but the skills they acquire will remain with them for life,” said Simmons partner Nick Benwell. Nick Seddon, managing director of Eversheds in Hong Kong, believes such initiatives are long overdue, even if they are coming out of the UK. Any program that brings lawyers closer to their clients may be a crucial www.legalbusinessonline.com
factor helping law firms separate themselves from the competition in an increasingly saturated legal services market. “You will see law firms in Asia following Seddon what is happening in the Nick Eversheds UK because it is vital to their future success,” Seddon said. “Asian clients can sometimes be more demanding than those in the US or the UK because there is potentially more cost pressure on them, and as a result lawyers here need to be more than just draftsmen,” he said. “Most lawyers do not worry about the continued existence of their firm – very few law firms go bust, but a number of businesses do. To be able to understand this, to appreciate the pressure that clients are under, is greatly valued and definitely a factor
courses such as an MBA are becoming critical for lawyers today – but training in areas like management, teamwork and being able to work with people from all different sorts of backgrounds with all different types of emotional make-ups is just as important.” These skills, Pe said, means that MBA holders have a clear advantage in the legal job market. “When I look at CVs and see someone has MBA qualifications it certainly piques my interest. Of course one has to consider where the qualifications were obtained, but it is fair to assume that most MBA graduates from good schools have been through an incredibly rich and challenging learning experience, where they Robert Pe have learnt leadership Orrick and management skills
“You will see law firms in Asia following what is happening in the UK because it is vital to their future success. Asian clients can sometimes be more demanding than those in the US or the UK because there is potentially more cost pressure on them, and as a result lawyers here need to be more than just draftsmen” nick seddon, eversheds
which separates great lawyers from good lawyers.” Robert Pe, a partner with Orrick in Hong Kong, said that the business and financial skills learnt through an MBA program offered lawyers more. “One does get a heightened understanding of the commercial drivers acting on clients and how to demonstrate that you are adding value,” he said. “In this sense, an MBA adds skills to your repertoire and also enhances those that you already have.” He undertook a two-year MBA course at London Business School, and is quick to point out that the benefits of an MBA extend beyond client relation skills. The business development and management skills obtained also assist lawyers in building their own profitable practice. “Of course the skills in entrepreneurship that one gains from
and how to work with a commercial outlook.” MBA holders aren’t of course the only lawyers that possess these skills, but without specific training and education in the area, it is unlikely the average lawyer will have the requisite level of these skills until much later in their careers, when they have been taught through experience. As law firms across the region – both international and domestic – become younger, the need for junior-level lawyers with these attributes is all the more important. While building the ‘total lawyer’ is an obvious goal, it seems that taking a leaf out of Simmons’ book of professional development and building total lawyers as early as possible in their career could become an imperative for leading firms – GFC or not. ALB 11
NEWS | analysis >>
Analysis >>
Insolvency work: restructuring with a small ‘r’ While the predicted surge of insolvency work after the GFC never materialised in Asia, disappointed insolvency lawyers in the region still have reason to be cheerful
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he financial crisis presented a lucrative opportunity for firms to beef up their insolvency & restructuring practices for the predicted surge in insolvency cases. “Accountants and insolvency practitioners became very excited when the GFC was in full swing,” said WongPartnership litigation and arbitration partner, Sean Yu Chou. “There were hopes for company collapses which provide lucrative
hires. But apart from a handful of headline corporate failures at the time, such as Lehman Brothers and more recently Japan Airlines, the expected levels of work never eventuated. “The surge of insolvency work following the GFC did not materialise as many in the region predicted,” said Linklaters partner Melvin Sng. “Government stimulus programs had pumped a massive amount of liquidity into the world’s economies. This
“Accountants and insolvency practitioners became very excited when the global financial crisis was in full swing. There were hopes for company collapses which provide lucrative liquidation and administration work” SEAN YU CHOU, WONGPARTNERSHIP liquidation and administration work.” Ready and waiting, some law firms went into urgent recruitment mode for extra staff, transferring lawyers Sean Yu Chou from other practices to WongPartnership handle insolvency work or building capacity through lateral 12
enabled many stressed companies to refinance their maturing obligations – and government rescue plans also allowed banks to shore up their balance sheets.” Head of Clifford Chance’s Asian restructuring practice Scott Bache agrees, confirming that Asia’s relatively well-performing economies meant t a lower number of insolvencies.
►► singapore COMPANIES IN COMPULSORY LIQUIDATION – 2010 Cases 30 25 20 15 10 5
0
Jan
Feb
Petitions filed
Mar Companies wound-up
Source: Insolvency Public Trustees Office
“In this region we have not seen the predicted wave of insolvencies post-GFC, [but] we have seen plenty of restructuring with a small ‘r’ – refinancings and revisions to agreements,” he said. “Also, with respect to China there have been many onshore/offshore financings that continue to be in default, as the offshore investors Asian Legal Business ISSUE 10.5
NEWS | analysis >>
have had considerable difficulty using their offshore rights to go over the border into China and get closer to the operating assets. Until China passes reforms allowing offshore equity Scott Bache Clifford Chance holders to use their voting rights to displace directors that are not cooperating with a consensual restructuring process, it is hard to see this position changing in the foreseeable future.” Banks also took a more tolerant approach to debt. “There were not many instances where creditors ‘pushed the button’ and went ahead with fully enforcing their rights,” said Chou. “Many have endeavoured to achieve consensual restructuring.” Bank creditors have experienced inhouse teams that can effectively handle these restructuring arrangements without the need for complex and contentious work – what necessitates and excites insolvency lawyers.
www.legalbusinessonline.com
The more obvious reason why Asia has not seen a blow-out in insolvency work is because government stimulus programs kept the world economy liquid and banks’ balance sheets strong. However, Linklaters’ Sng points out that the government injection of liquidity among the domestic banks will not last forever and consequently those weaker companies – both in and
problems in Asia – of overcapacity in some economies and high leverage in certain sectors – remain unresolved. As the effects of the liquidity boost wear off in 2010, even stronger companies may need to restructure or refinance their debt. Certain sectors of the economy, including manufacturing and shipping, may come under particular stress.
“Although in Asia markets have rebounded more quickly than elsewhere, the recovery is still very fragile and there is a sense that a second dip may be round the corner” MELVIN SNG, LINKLATERS out of Asia – will cease to have access to cheap money. “If the macroeconomic environment and the appetite of banks to lend do not improve sufficiently to offset the withdrawal of government stimulus programs, weaker corporates will need to restructure their debts or go insolvent,” Sng said. He added that the fundamental
“Although in Asia markets have rebounded more quickly than elsewhere, the recovery is still very fragile and there is a sense that a second dip may be round the corner,” Sng said. “We therefore anticipate a further round of corporate defaults to generate increased insolvency and restructuring work.” ALB
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INDUSTRY >>
Job vacancies A
uk report SJ Berwin court Proskauer Rose for merger Its scope would always have been much narrower, but the talks around a merger between West Coast-headquartered US firm Orrick and UK player SJ Berwin were already underway even before the Hogan-Lovells merger had actually come into effect. Some industry observers saw the Orrick-SJ Berwin tie-up as the first in a possible series of UK-US reactions to the Hogan-Lovells coup. Alas, the talks fell over as most such discussions do – in the early stages. Not to be deterred, though, SJ Berwin is already pressing ahead with another potential US partner – Proskauer Rose. This merger is said to be driven by the funds practices of the two firms, who already have a working relationship. The combined firm would have revenues of approximately US$900m, putting it in the global top 30 by revenue. Part-timers patch up capacity at Freshfields An anticipated upturn in work levels later this year has prompted Freshfields to consider tapping
into its network of alumni to handle increased workloads. Given the working title “Fresh Work”, the scheme is aimed at former fee-earners who might be available to work either part-time or on a short-term basis during busy periods. Changes afoot for associate salaries in 2010 Clifford Chance has followed suit behind Freshfields to become the latest Magic Circle firm to unfreeze associate salaries. The firm raised rates for assistants as well as allowing them to progress through the lockstep system. From 1 May, associates and trainees will enjoy increased rates by an average of 3%– NQs will now earn £61,500, up from £59,000 last year. An associate with one year’s PQE will now take home £68,000 and three-year PQE salaries have increased to £84,500. Trainees will also benefit from a small salary increases: first and second years will now earn £38,000 and £43,000. Meanwhile, Linklaters has announced its associate pay scale for the coming year, maintaining its current rates after a reduction 12 months ago.
s major banking & financial institutions in Asia look to recoup post-financial-crisis talent shortages, so too it seems are firms. Signs of the renewed recruitment market for banking & finance lawyers are popping up everywhere – banks such as Citigroup, BoA Merrill Lynch and UBS are offering lucrative pay packets and bonuses in-house to fill talent shortages following the financial crisis. And according to recruitment firms, demand from the financial services industry and other sectors is being transferred to private practice. “Banking & financial service has seen the greatest legal jobs growth over the last three months,” said Carolyn Dickason, regional director of Hays Legal. “Firms have an ongoing need to identify banking & finance lawyers who have handled matters with the
THAILAND >>
‘Business as usual’ for
ROUNDUP • DLA Piper recently appointed a 19-lawyer team from Simmons & Simmons to enhance the capabilities of its existing 100-strong lawyer practice operating from Milan and Rome. The team includes four partners • Lovells promoted 21 lawyers to its partnership this year in the litigation, IP and finance practice areas. It is the firms largest promotion since 2007, compared to the 19 and 18 made up in 2009 and 2008 respectively • Addleshaw Goddard litigation partner Monica Burch has won the partnership’s backing to succeed senior partner Paul Lee following a contested election for the position of chairman of the firm’s board. Burch will take over from former managing partner and current chairman of the LLP Mark Jones • Konstantin Mettenheimer and Guy Morton recently announced that they would not be taking on third terms as joint senior partners at Freshfields Bruckhaus Deringer. An election campaign is likely to be held in autumn, but the firm is yet to decide whether it will continue having a joint senior partner or instead opt for one lawyer to take on the role • Scott Bowie was recently appointed to succeed Tim Shipton as head of Linklaters global investment management team. Shipton will continue in his role as co-head of Linklaters’ investment managers • Reed Smith recently recruited four senior construction partners from Pinsent Masons, boosting its construction practice and leaving Reed Smith with just two London-based construction partners • Walker Morris is set to scrap its executive chairman role once current chairman Peter Smart retires in May 2011. The role of executive chairman will be replaced by a non-executive chairman and managing partner
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Asian Legal Business ISSUE 10.5
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rocket as recovery gathers pace
leading financial institutions.” Norton Rose, fresh from its Australia merger with Deacons, is among the more aggressively hiring firms. As of mid-May it was offering a total of 45 vacancies in Asia-Pacific (see table), the majority of which were in corporate and banking. ALB
►► Norton Rose – Asia-Pacific vacancies as of 12 May 2010 Location
Number
Gulf
2
Australia
29
Greater China
11
Japan
3
Thai law firms caught in political unrest
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aw firms in Thailand with offices on the main road where the military and protestors were standing off continued to operate as usual, despite fears the street could become a battleground between angry protestors and armed troops. Red-shirt protestors opposed to the government pushed into the “Wall Street” of Thailand, on Silom Road, where many of the country’s top international and domestic law firms are located. One of those is Blumenthal Richter & Sumet, an international law firm located on the intersection of the Silom and Rama IV roads. “I can see [the protest] outside my window actually, in the intersection where the Dusit Thani Hotel is. You can hear the protestors’ loudspeakers from here,” said partner Ira Blumenthal at the time. “Right below our office, there are troops blocking off Silom road, and on the other side you have the protestors. So there’s a kind of standoff happening and nobody’s really doing anything.”
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The political unrest, which has raged on for more than a year now, has been affecting the flow of inbound foreign direct investment work for local law firms. Some clients cancelled business trips indefinitely, as embassies issued travel warnings. “There is uncertainly as to what’s going to happen next,” said Blumenthal. “We’ve had a lot of clients rescheduling cancelled meetings until things are clarified.” There is hope that will soon change. Herbert Smith’s Bangkok office is situated in the same building as Blumenthal’s and office managing partner Alistair Henderson said that although the pace of work had slowed, the firm continued to receive significant instructions from regional clients wanting to do business in Thailand. “Work hasn’t disappeared – there is definitely work to be done,” he said. “We’re receiving instructions and talking to clients looking to expand operations or set up here. Morale is holding up quite well.” ALB
news in brief >> FoxMandal gets closer to legal industry regulator FoxMandal Little’s Noida office played host to the new newly constituted Bar Council of Delhi’s newly elected office bearers – chairman KK Sareen, vicechairman Jaibir Singh Nagar, and honorary secretary Nitin Ahlawat, and others. The firm said it was “very keen” to host the event as the Bar has a significant role in regulating the legal profession. “[We] regularly get queries from law firms the world over on regulatory issues of the Indian Legal System and the firm intends to work closely and seek guidance from the Delhi Bar Council in view of the exploding Indian economy and opening up of various service sectors,” said managing partner Som Mandal.
Clifford Chance plugs gap in Asia capital markets team Clifford Chance has reorganised its capital markets practices in Singapore and Hong Kong in the wake of Hong Kong partner Alex Lloyd’s move to Sidley Austin (see appointments p24). CC has filled Lloyd’s position by relocating head of Asia capital markets Crawford Brickley from Singapore to Hong Kong, as well as bringing in Julian Perlmutter, a senior consultant from the London office, in late February. In Singapore, the firm has promoted senior associate Johannes Juette to senior consultant.
Clayton Utz denies U-turn on Asia policy Australian firm Clayton Utz’s decision to open a Hong Kong office is not a departure from its traditional relationships-based approach to international operations, says CEP David Fagan. The decision will see Clayton Utz arrive in Hong Kong some 20 years after rival Mallesons first entered that market. “This move doesn’t David Fagan Clayton Utz derogate from what we’ve done with Lex Mundi or PRAC - it’s a logical extension of the construction and major projects work we’ve done in Asia,” said Fagan. “We remain committed to our relationships with local Hong Kong firms. In fact, we expect there will be more opportunities to work with local firms in the region as the result of our having a presence on the ground in Hong Kong.” The two-partner office will be led by Glenn Haley, who most recently headed Deacons’ Hong Kong construction practice, and Clayton Utz partner Colin Dodd, who has been based in Hong Kong for a number of years. The office will focus on construction and major projects and international dispute resolution, although expansion into other areas is not being ruled out.
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SINGAPORE >>
Harry Elias split T
us report Lovells Chicago office to close curtains Lovells recently announced plans to close its seven-partner Chicago office, due to its underperformance for a number of years. Although the plan is still subject to partnership approval it is expected that the office will close at the end of October, six months after the firm’s merger with Hogan & Hartson goes ahead. However, firm officials stress that the closure has been under review for some time and is not related to the merger. Lovells is currently in discussions to see whether there is scope to transfer the Chicago partners to another office, although this is not guaranteed. Meanwhile, Lovells US managing partner Marc Gottridge has vowed to continue building the firm’s New York presence, following its May merger with Hogan & Hartson. Bryan Cave look for UK tie-up St Louis firm Bryan Cave has been active on the merger front for a number of years – an attempted large-scale tie-up with Squire Sanders failed but a useful one with Atlanta-based 220-lawyer firm
Powell Goldstein went ahead last year. Now, however, it has installed one of the key players behind the Powell move – litigation partner Rodney Page – as head of its London office, with a specific directive to find a UK partner firm. Bryan Cave’s London office had a tough 2009 and its UK and European growth ambitions needed the extra impetus. The most likely merger candidate will be a mid-rank firm with similar PEP. Mayer Brown slashes staff Mayer Brown recently cut 28 associates and counsel and 47 members of staff from its US offices in the firm’s third round of layoffs in 18 months. The firm cited that ‘overall demand for legal services has not recovered fully’ and ‘voluntary lawyer departures have been significantly lower than our normal levels’, as reasons. Mayer Brown’s recently released financial results revealed that revenues fell by almost 14% in 2009, along with a decline in total revenue from US$1.12bn to US$1.29bn. The firm’s London office also saw a double-digit decline in revenues, with turnover falling by 16% to £93.8m from £111.6m in 2008.
ROUNDUP • Linklaters recently appointed Jean-Philippe Brisson as head of its US environment and climate change practice in New York. He joins a four-partner team in the firm’s practice • US firm Akin Gump Strauss Hauer & Feld has poached Hogan & Hartson’s Geneva office to launch its own Swiss practice this month. The team will be led by Charles Adams, Hogan’s former Geneva office managing partner and co director of the firm’s international litigation and arbitration practice, and will continue to focus on international arbitration, international civil litigation, corporate and commercial law and giving tax advice to corporates and high-net-worth individuals • Mayer Brown has launched a competition and distribution practice in Paris with the hire of partner Nathalie Jalabert-Doury from Carreras Barsikian Robertson & Associés, who joins the office as the new practice head • Milbank Tweed recently hired Shearman & Sterling’s Latin American practice head Andrew Jánszky, to lead its new São Paulo office. Jánszky – previously Shearman’s Latin American head and managing partner in São Paulo – will arrive at Milbank with associate Tobias Stirnberg, who joins as partner • Hogan & Hartson and Lovells may want to re-think their name post-merger, after it emerged that the Hogan Lovells name has already been trademarked by a road haulage company in Nebraska. If the name is not changed it could develop into a costly litigation battle
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he managing partner and six lawyers who left Singapore firm Harry Elias Partnership in February have set up a new firm with the help of clients and other law firms. Inca Law, an acronym of the founding partners’ surnames – Harry Elias’ former managing partner Latiff Ibrahim, head of criminal litigation Shashi Nathan, head of insurance Lynette Chew, and constructions partner Kelvin Aw – opened recently with the backing of the local legal industry and the lawyers’ clients, said Ibrahim. After news broke of their departure from Harry Elias, the lawyers decided to set up their own practice despite receiving offers to join other firms. “A few established Singapore and foreign law firms kindly offered us to join them or enter into some working arrangements, but when we explained our desire to run our own boutique practice they were very understanding and supportive, and left the door open for future collaborations,” added Nathan. Some clients even helped find office space. “Initially we worked from home and our clients’ offices, then one of our clients offered a partially fittedout office at the heart of the city in Raffles Place,” said Aw. “Another client assisted us to fit out the office. For two months we were running a law firm with all kinds of people – ID designers, contractors, IT engineers, telephone technicians – all around us.” It is understood the lawyers brought many
SINGAPORE >>
Clifford Chance swaps
C
lifford Chance’s infrastructure partner Geraint Hughes will take over management of the Singapore office from current head Phillip Rapp, in a sign of where Geraint Hughes the firm will focus its Clifford Chance regional business. Hughes, who heads the firm’s Asian Asian Legal Business ISSUE 10.5
NEWS >>
reflects new market pressures
of their old clients from Harry Elias with them. As ALB reported in February, the lawyers’ departures came after disagreement on Ibrahim’s leadership style in promoting new partners and seeking merger and alliance partners to grow in order to compete with foreign law firms arriving with Qualifying Foreign Law Practice (QFLP) licences in 2009. “It is the medium-size firms who are going to be affected the most by the QFLPs, especially those who are not willing to deal with the issues headon. For us, all foreign firms present opportunities for collaborations on a case-to-case basis. That desire – to establish close working relationships with well-reputed local law firms in some ASEAN cities – remains strong
...” said R Ravindran, a former Member of Parliament who joined the firm as a consultant from Harry Elias. Perhaps the greatest challenge – and the most amusing – was coming up with a unique name to separate the firm from the competition: “We didn’t want future directors to feel that they are not part of the firm; English names were just not us, and there were too many local law firms with Latin names (one that came up was shared by a cleaning company, so that was quickly rejected),” explained Ibrahim. “Then in the list of names that we all had proposed was “INCA” – the initials of the four founding directors. We tested it with a few key clients and close friends and after the initial friendly ribbing about ancient civilisations, Machu Picchu and so on, they all loved it. The rest is history.” ALB
Singapore managers to focus on infrastructure work energy and infrastructure group, will relocate from his current post in Hong Kong in May to take over operations in Singapore. Rapp will remain in Singapore heading the Southeast Asia corporate practice. He recently oversaw the firm’s changeover to a local lawqualified practice following the QFLP licence granted by the Singapore government last year. www.legalbusinessonline.com
The shift from a corporate to an infrastructure specialist indicates where Clifford Chance’s longer-term investments will be made in the region. The firm’s head of Asia, Peter Charlton, said the changeover is part of the “next phase of development” in the Southeast Asian region for the Magic Circle firm and that energy and infrastructure would be a particular focus. ALB
news in brief >> Indian firm joins banks in office complex Indian firm Majmudar & Co has relocated its Mumbai office to greener pastures in the Bandra Kurla Complex, in what the firm hopes will be greater access to the local banking & financial industry. Moving to the BKC will make it the first major national law firm there. In the last couple of years, BKC has become a financial centre, and a number of multinational and Indian banks are now headquartered there. Majmudar’s local litigation and dispute resolution team will be based near the Mumbai High Court in Flora Fountain; the firm also has an office in Bangalore.
Harneys gains best friend’s Cyprus office Offshore firm Harneys has gained a presence in Cyprus after merging the office of its Cypriot ‘best friend’ firm Aristodemou Liozides Yiolitis (ALY) into its network. The firm entered into the ‘best friends’ agreement with ALY in 2008 and now, having formalised the merger, has gained its fifth international office. The firms hope to target Russian and Indian offshore businesses through the BVI, utilising the favourable tax treaties Cyprus has formed with emerging economies. “Cyprus is a preferred jurisdiction for Russia investment… we believe Cyprus will be relevant to a great many of our clients, including those in the Far East, India and Europe,” said Harneys partner Peter Tarn. Former Maples partners to head up offshore boutique in Hong Kong Cayman Islands boutique firm, Thorp Alberga, has opened in Hong Kong where it will be led by former Maples and Calder partners Richard Thorp and Harriet Unger. The firm’s move into Hong Kong is opportunely timed. The SAR relaxed listing rules late last year paving the way for Jersey and BVI incorporated companies to list on the HKEX, which is likely to bring a corresponding increase in workload for offshore firms in Hong Kong. Also, recent consolidation activity among offshore firms has made the offshore legal market hierarchy as fluid as ever. Nevertheless, Hong Kong is among the world’s most competitive offshore legal markets, being an office location of all of the major offshore players (Appleby, Conyers, Harneys, Maples and Walkers).
17
NEWS >>
Update >>
CHINA >>
Intellectual Property Outsourcing of patent search and examination
O
ne of the lesser known facts about the Singapore patent system is that the search and examination of Singapore patent applications is not conducted by the Intellectual Property Office of Singapore (IPOS). Instead, this important task has been contracted out to foreign Patent Offices, namely the Australian, Austrian, Danish and Hungarian Patent Offices. Unfortunately, applicants cannot select which Patent Office they wish to conduct the search and examination at the time of making the request. Instead, cases are assigned by IPOS to one of these Patent Offices and the applicant simply receives a search and examination report from one of these Patent Offices and is required to deal with them. How does this peculiarity affect patent applicants who choose to request search and examination in Singapore? In theory, when the various Patent Offices undertake to conduct this search and examination, they agree to do so under Singapore patent laws. However, in practice, the question arises as to whether it is possible for these Patent Offices to be able to effectively apply Singapore law to these patent applications. In particular, under Singapore patent law, there is no exclusion for patentable subject matter such as computer software and business methods. In some of the Patent Offices which have been tasked with conducting the search and examination, such applications would not be patentable under their law. It is not clear therefore whether these Patent Offices would be able to adequately examine the patent applications in relation to such subject-matter. In the writer’s opinion, this would be challenging, though of course not impossible. Interestingly, in the case of post-grant requests for search and examination under section 38A of the Singapore Patents Act, patent owners do have a choice of which Patent Office they wish to conduct the search and examination and the fees for the different offices varies to conduct the search and examination. In such cases, the patentee has the opportunity to consider which Patent Offices would be most appropriate to conduct the search and examination for the technology, Applicants should therefore bear this in mind when requesting search and examination in Singapore for patent applications relating to subject-matter that is not patentable in Europe. Since the applicant cannot choose the Patent Office, it may be preferable in such instances to avoid the search and examination process in Singapore and rely on the grant of a corresponding patent, an acceptable alternative under Singapore patent law.
Sheena Jacob, head of IP & technology group ATMD Bird & Bird LLP Tel: 65 6428 9801 Email: sheena.jacob@twobirds.com ATMD Bird & Bird LLP is a Singapore law practice registered as a limited liability partnership in Singapore. The firm is associated with Bird & Bird, an international legal practice. It is solely a Singapore law practice and is not an affiliate, branch or subsidiary of Bird & Bird or Bird & Bird LLP.
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Sheena Jacob
Legal work abounds as B
oth CNOOC’s in-house legal department headed and the company’s external counsels have had a busy month working on headline transactions. A week after the company announced its plan to take up a 50% stake in Argentina’s Bridas for US$3.1bn, it entered into a 20-year
INDIA >>
India and sport big business T he Queen’s Baton made its way to Australian firm Middletons’ Melbourne office yesterday as part of a networking event which presented an opportunity for the firm to not only host the baton before it makes its way to Delhi later this year but also promote and develop crossborder business through a common love of sport. India group head Cameron Abbott said his firm understands that sport is big business in both countries. “Both Australians and Indians love their sport including cricket and the Commonwealth Games and many a business deal has no doubt been struck while watching their beloved side win or lose.” Abbott is certainly on the money. For both Australian and Indian business, India’s growing, affluent middle class will be a key part of leveraging brand power through sport. The brand value of the Indian Premier League has been estimated to be around US$4bn. “We encourage our local clients to look to India when investing or off-shoring work because of the similarities of our laws and that fact that India recognises copyright and
Asian Legal Business ISSUE 10.5
NEWS >>
Update >>
CNOOC spreads wings LNG purchase agreement with Australia’s BG Group – one of Australia’s largest LNG contracts. “This project is unique. It is the first coal seam gas to LNG deal in the world and also represents one of the largest volumes of LNG sold in one contract in Australia...The timeline for completing the numerous project documents has been a challenging one,” said Anna Howell, the head of energy Asia at Herbert Smith, who advised on the deal. Herbert Smith was also one of the five international law firms representing CNOOC in its 2005 bid to acquire US’s Unocal for US$18.4bn. The offer was eventually withdrawn due to political pressure in the US. In addition, Herbert Smith is reportedly acting for CNOOC in its latest endeavour to acquire a third of Tullow Oil’s assets in Uganda. In terms of PRC legal advice and deal executions, CNOOC receives strong support from its renowned in-house legal team led by general counsel Zhao Liguo. “If foreign law requires it, we would prefer to obtain legal opinions from international firms with careful supervision and review them in-house. To some extent, the role of such international firms is supposed to be expressly putting forward all reminders of potential legal risks under underlying foreign law, on the basis of good understanding of and communication with their clients,” said Zhao.”When selecting external counsels, we will look through and pay more attention to the personal achievements/credentials of those members to render legal services to us but not the overall experiences/credentials of those candidate law firms. Frankly, we would certainly hope to get a reasonable quotation and hourly rate as well,” he added. ALB
for law firm
International Tax OECD and Council of Europe Agrees on Revised Treaty to Help Combat Global Tax Evasion
T
he Organization for Economic Cooperation and Development (OECD ) said it agreed with European nations to modify a treaty designed to combat global tax evasion. The revision of the so-called Convention on Mutual Administrative Assistance in Tax Matters aims to “align the convention to the international standard on information exchange for tax purposes by allowing for the exchange of bank information,”. The Council of Europe, representing 47 countries from Germany to the U.K., announced that the will be signed at an OECD meeting on 27-28 May in Paris. “The convention is a unique instrument to counteract international tax avoidance and evasion,” OECD Secretary General Angel Gurria said in the statement. “The OECD and the Council of Europe have agreed to improve international cooperation to combat tax evasion and the standards set by the convention are being updated to reflect this new consensus.” The convention was first introduced in 1995 and counts Azerbaijan, Belgium, Denmark, Finland, France, Iceland, Italy, the Netherlands, Norway, Poland, Sweden, the U.K., the U.S. and Ukraine among its members while Canada, Germany and Spain haven’t yet ratified it. It will now be extended to developing countries to help them benefit from “the new, more transparent tax-cooperation environment,” the OECD said in the statement. This Convention covers assistance in collecting both Direct and Indirect Taxation such as VAT; most Double Taxation Agreements do not cover Indirect Taxes. By Debbie Annells, Managing Director, AzureTax Ltd, Chartered Tax Advisers Suite 1010, 10/F Lippo Centre, Tower Two, 89 Queensway, Hong Kong www.azuretax.com, a member of AzureTax Group (Tel) +852 2123 9339 (direct line), (Main Line) +852 2123 9370, (Fax) +852 2122 9209 Registered with the Chartered Institute of Taxation for purposes of anti money laundering legislation.
Debbie Annells
trade marks – not a luxury available in many countries with a low-cost manufacturing base,” said Abbott, who also reports advising a number of Australian companies, mostly in the logistics industry, going to India ahead of the Commonwealth Games. ALB www.legalbusinessonline.com
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NEWS >>
news in brief >> MSI looking for more Asian firms International legal network MSI Global Alliance has admitted Carag De Mesa & Zaballero (CDMZ) as its exclusive member for the Philippines. CDMZ was established in 1996 and has since grown into a five-partner, 25-staff firm. “With many clients now requiring advice in jurisdictions throughout Asia and in Europe, the Middle East and North America, it is important that we establish stronger, more formal links to law firms around the world,” said name partner Priscilla Zaballero. MSI’s chief executive James Mendelssohn said that the appointment of CDMZ is a sign of things to come for MSI in the region. He said that further expansion of the network’s operations in Southeast and North Asia is also imminent. “Carag De Mesa & Zaballero’s [appointment] as MSI’s sole law member in the Philippines is another big step forward for MSI in the East Asia region… We are now aiming to extend MSI’s coverage to Cambodia, Indonesia, Myanmar, South Korea and Taiwan, and invite strong, local firms to apply,” he said.
MIDDLE EAST >>
Firms close rare PE deal in tough G
lighting company, General Lighting, which was advised by Dewey. The other firms advised the banks. The transaction was the first Saudi acquisition for the Carlyle Group, which has remained active despite the slowdown in the global PE market. In Asia, the company has so far made 118 investments and has just closed a
ibson Dunn & Crutcher, Dewey & LeBoeuf, Clifford Chance and Hourani & Associates have closed a rare PE transaction for The Carlyle Group amidst a tough PE market in the Middle East. Gibson Dunn and Hourani & Associates advised Carlyle on its acquisition of a 30% stake in Saudi ►► PE Deal Volume by Region 705
278
967
629
518
1,289
1,025
614
1,292 1,289
Americas
Asia-Pacific
EMEA
Source: Dealogic This chart captures transactions where the buyer is a PE firm acquiring a target based in Americas, Asia-Pacific or EMEA. Deal volume includes deals where values are disclosed and non-disclosed.
MIDDLE EAST >>
Kuwaiti firm ASAR rebrands Kuwaiti firm Al-Sarraf & Al-Ruwayeh has rebranded its name to ASAR – Al Ruwayeh & Partners, a year after the split between the firm’s two local Kuwaiti partners. In 2009 founding partner Hameed Al Sarraf exited the firm to set up his own separate Kuwaiti practice. It continued operating under the same name – Al Sarraf & Al Ruwayeh – while its international division in Bahrain continued independently under the ASAR Bahrain name. The decision to rebrand came after Hameed Al Sarraf’s practice announced its intention to set up an international division of its own. “Hameed Al Sarraf is now pursuing a separate and new international department with his local law firm Abdul Hameed Al Sarraf & Partners,” said Sam Habbas, the head of the firm’s international operations, adding that the rebranding will not affect the firm’s international operations – all the partners, associates and staff will remain at the firm bar Hameed Al Sarraf.
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Latham & Watkins gains White & Case’s Riyadh office
L
atham & Watkins has confirmed a tie-up with former White & Case Saudi sponsor Mohammed Al-Sheikh that has led to a new Lathams office in Riyadh. Al-Sheikh’s departure from White & Case was among four other senior-level defections from the firm’s Middle East operations in February, all to Latham & Watkins. At the time, Lathams declined to verify the appointments but has since confirmed that Al-Sheikh has aligned with the firm, taking with him projects partner Christopher Langdon and banking & finance associate Harjaskaran Rai. They will be accompanied by New York-based banking & project finance associate Salman Al Sudairi, a former White & Case lawyer, who is transferring to Riyadh. The lawyers are operating in the same Al Tatweer Towers office as during the White & Case association.
For Latham, it will mean a fourth branch in the Middle East, along with the Doha, Abu Dhabi and Dubai offices that were launched in 2008. Al Sheikh’s appointment will also give the firm a stronger foothold in the local Islamic finance sector. It’s not the first time Lathams has built up a new office through lateral hires – in 2009 it confirmed the appointment of seven corporate partners defecting from Allen & Overy Hong Kong. For some international firms in Saudi Arabia, cementing a sponsor has been a shaky business in the past – between 2008 and 2009, DLA Piper lost two Saudi sponsors, Abdul Aziz Al Bosaily and Abdulaziz Al Assaf, before linking up with Alaa Naji. Although White & Case still has a Riyadh presence on its website, no local lawyers are listed. It hasn’t confirmed the search for a new sponsor. ALB Asian Legal Business ISSUE 10.5
NEWS >>
Gulf market new US$2.55bn fund focused on acquisitions in the region, named Carlyle Asia Partners III. It is also increasing its focus on the Middle East market, having raised US$500m last year for acquisitions in the region. Dubai-based partner Paul Harter, who led Gibson’s team on the transaction, is not, however, confident of an immediate pick-up in regional PE activity. “The trend line coming out of the worst of the financial crisis is good, but not steep. Six to 12 more difficult months would not surprise me,” he added. The market has been plagued by lack of funding for deals. “Sourcing deals remains difficult; it’s been a very difficult market for financial sponsors in the Middle East,” said Harter. “Low investor confidence and tight credit markets means that only the best and strongest have been able to get deals off the ground.” Harter says that more deals will unsurprisingly depend on the security of the debtor, and those like Carlyle (which his firm has represented on several deals in Europe and the US) may do well. “Carlyle and a small number of the more prestigious regional players are well positioned to do more deals sooner than others,” he said. “Lenders want to lend on the security of reputation, more than on the security of assets or cash flows. Carlyle is one of the only international players with a regional buyout fund and if they say they will do more deals this year, I believe them.” ALB
MIDDLE EAST >>
US firm launches in Middle East with dual tie-ups
U
S firm Crowell & Moring has made its Middle East debut by forming associations with Saudi firm Al Enizy & associates and Cairo-based firm Hegazy & Associates. ►► Crowell & Moring – Fast facts
• 11 offices – Washington, New York, Los Angeles, San Francisco, Orange County, Anchorage, London, Brussels, Cairo, Riyadh, Jeddah • Founded in 1979 by 53 lawyers, mostly from Jones Day • Currently has approximately 500 lawyers
The firm has opened an affiliated Cairo office under the sponsorship of Walid Hegazy, an Islamic finance lawyer who headed the Islamic finance practice at Freshfields in 2007. In Saudi Arabia, it has tied up with local lawyer Fahd Al Enizy, whose practice focuses on Islamic finance and corporate work. Al Enizy has another office in Jeddah. Crowell is focusing its new Middle East practice on on corporate and M&A matters for US clients doing business in the MENA region. It said the decision to go to Egypt was made in response to the growing amount of energy, telecoms and construction work there. ALB www.legalbusinessonline.com
Update >>
Financial Should you be buying gold?
W
ith governments printing record amounts of currency to assist with Government bailouts, Gold could go to $2,500 an ounce over the next 5 years but what does that actually mean? Has Gold really gone up in value by 100% or has your paper currency just halved in real value without you realizing it? Personally, I believe the price of physical gold simply reflects what real inflation caused by record monetary stimulus is doing to the true value of paper currency. Government led currency devaluation is now underway and I fully expect this trend to continue. Since April 2001 the USD has fallen in value versus the price of physical gold by more than 80%. Whilst (for the next 6 to 12 months) I am bullish on the USD versus the Yen, Euro and Pound Sterling, longer term I believe that you should hold part of your investment portfolio in gold and other precious metals. Whereas Gold has gone up by 20% over the last 12 months “in paper terms” some of my clients have benefited from investing in Palladium which has outperformed Gold over the same period by more than 300%! A popular method of investing in gold is to use Exchange Traded Funds (ETF’S). However, very few ETF’S are backed by actual physical gold. Why is this important? Well in the event of a global currency crisis which I believe is a real possibility, I would rather be paid out in physical gold than devalued dollars. There are a few ETF’S which, subject to certain restrictions, will allow payment-in- kind, in other words you can take physical delivery of the gold. Please contact me if you would like more information regarding this. The way to find out if you have really made a profit on any asset is to simply compare how many ounces of gold you could buy when you first bought the asset and then compare this to how many ounces of gold you can buy when you come to sell it. The DOW could possibly go as high as 100,000 in the future but if it does has it really gone up in value or just price? The key distinction here is that the value of gold itself doesn’t change, the price is what changes. For a free exploratory review of your investments please contact Brian Taylor. Brian Taylor, senior investment adviser Horwath Financial Services Ltd Tel: (852) 2511 8337 Email: brian.taylor@hfs.com.hk Website: www.hfs.com.hk
Brian Taylor
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NEWS >>
news in brief >> Gide and Crawford Bailey team up on US$2bn Indian govt sale A plan by the Indian government to sell off stakes in state-owned companies has been good news for both international and local firms over the last year. Gide Loyrette Nouel (GLN) and Indian firm Crawford Bayley are the latest beneficiaries of the Chris Mead Gide Loyrette policy, have acted for the Indian Nouel government on its divestment, through a public offer, of an 8% equity stake in the country’s largest iron-ore miner, National Mineral Development Corporation. The deal raised US$2.2bn for the state. It was an important deal for GLN – which won the role as sole international counsel via a tender process – as it is one of the firm’s first Indian transactions. “The NMDC transaction is by far the most high-profile the firm has been involved in,” said GLN’s London partner Chris Mead. This latest sale is part of a larger plan by the Indian government to partially privatise a number of state-owned companies in the next few years. So far, Amarchand & Mangaldas has reaped the most roles from the plan, acting on the US$1.8bn offering of a 5% stake in NTPC, the US$500m stake sell off of Oil India, as well as the US$1bn IPO of the National Hydroelectric Power Corporation.
tsmp appoints former gcs to launch niche practices Singapore firm TSMP is adapting to the increasingly competitive local legal market by appointing former general counsels to launch niche practices that target sectors such as technology and energy & resources. It has recently appointed former Microsoft associate general counsel Bryan Ghows as a director in charge of launching a new IP/IT practice. Ghows, who joins TSMP having spent a year running his solo boutique cross-border US/ Singapore IP practice, is expected to drive the IT practice’s focus away from litigation and dispute resolution and more towards emerging technologies. “After a year of running a solo IP practice in the US and Singapore, it became clear that to grow, I needed to focus on one jurisdiction,” Ghows wrote in his blog. Last November, the firm also appointed Timothy Goh, the former GC of Singapore energy company PowerSeraya, to launch an energy & power practice. A month later it appointed China-specialist partner Jasmine Quek from DLA Piper’s Beijing office to develop cross-border M&A opportunities. Managing director Thio Shen Yi said these appointments will help the firm adapt to the changing face of the local legal industry: “Clients of today want to work with, and will only pay for, lawyers who can create customised legal solutions in complex and highly specialised areas. They won’t pay for commoditised template documents. Lawyers need to change the way we service our clients,” he said.
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nz/uae >>
High hopes as ribbon is cut on Kensington Swan’s Abu Dhabi dabble
H
ad he been back in Wellington, New Zealand’s trade minister Tim Groser would have still been a few hours away from having to get up to a wet, chilly morning. As it was, he was eight time zones away in Abu Dhabi enjoying a dry, balmy evening. The occasion? The official opening of Kensington Swan’s pioneering new Middle-East office. The fact that it was the minister himself wielding the ribbon-cutting scissors perhaps gives credence to the
claims of Kensington Swan’s chairman, Clayton Kimpton, that the new office was important “not just for Kensington Swan but for the New Zealand professional services sector as a whole”. As the choice of Abu Dhabi – the seat of the UAE national government – over the more commonly selected Dubai suggests, the team is targeting government work as a significant source of revenue, along with private clients and outbound investment into Australasia. ALB
australia/japan >>
Aussie firms in Japan: a viable proposition?
A
ustralian top-tier firm Blake Dawson says its precedent-setting move in being the first Australian firm in Japan may help other Aussie firms launch there too. Six months after announcing its plans, the firm coordinated with the Japanese Ministry of Justice to obtain regulatory approvals and has secured its licence to operate as a foreign firm advising on Australian law. “It was a fairly lengthy process in confirming that our office would satisfy all the legal requirements of the ministry,” said resident partner Natsuko Ogawa. “It was probably made Natsuko Ogawa Blake Dawson more difficult in that the Australian system has not had to come into their scrutiny in the past. That in some ways may benefit other firms following in our footsteps if they choose to, but it’s hard to say.”
Ogawa is accompanied by three other lawyers stationed at the new office, with another to join later this year. Although the firm has a stable list of Japanese clients such as Kirin and Mitsui – there is scepticism that the market for an Australian firm in Japan may not be sustainable. “The market solely for Australian law advice is far too thin in Tokyo to merit a major investment there by the large Australian law firms, who already compete effectively for this business among themselves in the major Australian cities,” said White & Case Tokyo partner Robert Grondine. “Just because there has been a surge of investment transactions from Japan to Australia in the past 12-24 months, which already illustrates my point that all of that work has been accomplished and serviced by them without having offices in Tokyo, does not justify the very large investment to open offices and staff people to Tokyo for the ongoing future.” ALB
Asian Legal Business ISSUE 10.5
NEWS >>
www.legalbusinessonline.com
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NEWS >>
appointments ►► LATERAL HIRES
Yulchon
Name
Leaving
Going to
Practice
Location
Alex Lloyd Various Assim Abbas Amitabh Sharma Shishir Mehta Takashi Shibuya Emmanuel Hadjidakis
Clifford Chance Orrick Legal Spectrums J Sagar Associates White & Case Ministry of justice Allen & Overy
Corporate finance Litigation Telco & media Infrastructure & projects Banking & corporate Corporate Banking & finance
Hong Kong Hong Kong New Delhi Mumbai Mumbai Tokyo Singapore
Sun Jin Hwang Tae-Wook Shin
Warburg Pincus Korea Customs Service
Sidley Austin Winston & Strawn Khaitan & Co Khaitan & Co Khaitan & Co Nishimura & Asahi Baker & McKenzie. Wong & Leow Kim & Chang Kim & Chang
Seoul Seoul
Bryan Ghows Alison Lindsay
Ghows Clifford Chance Hong Kong Paul Hastings
TSMP Minter Ellison Rudd Watts Orrick
M&A Customs, international trade IP/IT TMT PE
Hong Kong
Maurice Hoo
►► Relocations
Singapore Auckland
Firm
Lawyer*
From
To
Clifford Chance Latham & Watkins White & Case
Various Salman Al Sudairi Baldwin Cheng
London, Singapore New York Hong Kong
Riyadh. Hong Kong Riyadh Beijing
*Foreign qualified
►► Promotions Name
Firm
Promotion
Practice
Location
Ian McGrath Victoria Simonova Johannes Juette Min Yee Ng Various
Denton Wilde Sapte Denton Wilde Sapte Clifford Chance Latham & Watkins Lovells
Partner Partner Senior consultant Partner Partner
Gavin Margetson
Herbert Smith
Partner
Oman Kazakhstan Singapore Singapore Shanghai, Hong Kong, Dubai Tokyo
Lewis McDonald May Tai Paul Scarr Don Stokes William Coleman Marc Fèvre Robert Lonergan Jin Kook Lee Won Jung Jae Hyun Park Won Il Sohn Kwon Do Kang * Sung Hoo Park* Robert Wachter* Young Joon Chun Kwang Jin Jung Un Sang Jung Ki Seon Shin Jang Hyuk Cho Jeong Soo Hahn Hee Joong Lee Jung Han So Young Sung.
Herbert Smith Herbert Smith Herbert Smith Freshfields Freshfields Freshfields Freshfields Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon Yulchon
Partner Partner Partner Finance Finance Finance Finance Partner Partner Partner Partner Partner Partner Partner Partner Partner Partner Partner Partner Partner Partner Partner Partner
energy & infrastructure energy & infrastructure Capital markets Capital markets IPMT, corporate, BRI, litigation, banking General dispute resolution Energy, Arbitration Corporate Counsel Counsel Counsel Counsel Corporate & finance Corporate & finance Corporate & finance Corporate & finance Corporate & finance Corporate & finance Corporate & finance Tax Tax Tax Tax Dispute resolution Dispute resolution Dispute resolution Dispute resolution Dispute resolution
Singapore Shanghai Abu Dhabi Tokyo Dubai Abu Dhabi Hong Kong Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul Seoul
*Foreign qualified
“As the Asian region continues its unprecedented economic growth, capital raising will be necessary to fuel that growth and we anticipate that the high yield debt and equity capital markets will continue to be very active”
Alex Lloyd, Sidley Austin 24
Yulchon promotes largest partner class Korea’s Yulchon has made up the largest number of associates to partner since the firm launched in 1997. The 16 new additions raise the firm’s partner total to 68. Most of the partners are from the corporate & finance practice – four locally qualified and three senior foreign counsel. From the tax practice, four new partners have been made up while the dispute resolution practice has added five. Yulchon Robert Wachter co-founder Sai Ree Yun said that the promotions are part of the firm’s strategy to build organically rather than pursue mergers. “Many Korean law firms pursue size first, merging with other firms to expand their services,” said Yun. “But we take the opposite approach of … internal talent development [combined with] strategic lateral hiring.”
Clifford Chance
Sidley Austin
Sidley gains corporate finance partner from Clifford Chance Sidley Austin will welcome corporate finance lawyer Alex Lloyd to its Hong Kong office this month, following his move from Clifford Chance’s capital markets practice in Hong Kong. Lloyd said he was attracted to his new firm having worked with Sidley lawyers on past transactions. Commenting on the appointment, Sidley’s Asia-Pacific regional manager Thomas Albrecht said “As the Asian region continues its unprecedented economic growth, capital raising will be necessary to fuel that growth and we anticipate Alex Lloyd that the high yield debt and equity capital markets will continue to be very active.”
Various
Khaitan & Co
Khaitan & Co appoints three new partners; gains boutique firm India’s Khaitan & Co has gained three new partners from rival firms. Foremost among them is telecommunications specialist Assim Abbas, who has been appointed partner in charge of Khaitan & Co’s telco & media Assim Abbas practice based in New Delhi. Abbas has agreed to merge his own boutique law practice, Legal Spectrums, which Asian Legal Business ISSUE 10.5
NEWS >>
he set up in 2008 after leaving his post as vice president of legal affairs at Indian telco giant Bharti Airtel. Arriving from rival firm J Sagar Associates is infrastructure specialist Amitabh Sharma, Amitabh Sharma joining Khaitan & Co’s infrastructure & projects practice in Mumbai. Sharma’s addition will be the second hire from J Sagar Associates for the firm in less than six months, following the appointment of competition partner Manas Kumar Chaudhuri in December. Shishir Meht Khaitan’s Mumbai office will also see the addition of former White & Case associate Shishir Mehta. His arrival in the banking & corporate practice is intended to build its capability in cross-border transactions – Mehta is admitted to practice in New York, Gujarat and the UK. Orrick
Winston & Strawn
Orrick lawyers defect to Winston & Strawn Hong Kong Four litigation lawyers from Orrick’s Hong Kong office have moved to Winston & Strawn, beefing up the latter’s commercial litigation practice. Partner Adrian Yip – who formed Orrick’s 2005 launch team in Hong Kong – has taken fellow litigation associates Philip Kwok, Cliff Mok and Genevieve Ku along with him to Winston & Strawn’s Hong Kong office. Winston & Strawn launched in Hong Kong as recently as 2008 through an association with local firm Luk & Co. With the additions, the firm hopes to boosts its litigation expertise in securities and IP disputes and white-collar crime. Its total number of lawyers in Hong Kong will grow to 12
Ministry of Justice
Nishimura & Asahi
Japanese MOJ official joins Big Four firm Former Japanese Ministry of Justice (MoJ) official Takashi Shibuya has joined local Big Four firm Nishimura & Asahi. Shibuya specialises in corporate and criminal law having spent two decades at the Japanese public prosecutor’s office and the MoJ. As counsel at Nishimura he will work across a number of practices, with a focus on corporate crisis management.
www.legalbusinessonline.com
Saudi Arabia
London
Clifford Chance to strengthen ties with Saudi ally Clifford Chance has transferred the co-head of its London capital markets practice to Riyadh, to boost ties with its Saudi ally, Al-Jadaan & Partners. Tim Plews will be relocated permanently to the Saudi firm in October where he will join fellow Clifford Chance partner Mohamed Hamra-Krouha, who has been on secondment since 2008 at Al-Jadaan. Al-Jadaan’s managing partner welcomed the addition, while Clifford Chance said Plew has strong client relationships in the Gulf and his addition will strengthen ties with Al-Jadaan. The firm has also announced that Hong Kong infrastructure partner Geraint Hughes will be the new managing partner of its Singapore office.
Allen & Overy
Bakers
Bakers appoints Allen & Overy senior associate Baker & McKenzie.Wong & Leow has appointed former Allen & Overy banking & finance lawyer Emmanuel Hadjidakis as an associate principal in its finance & projects practice. Hadjidakis, a senior associate at Allen & Overy’s Singapore office, and prior to that worked at Allens Arthur Robinson’s Sydney office. His practice focuses on Islamic finance, restructuring and general Emanuel Hadjidakis banking.
Trowers, DLA Lovells
Lovells makes up new partners ahead of merger Lovells has made up the largest number of its lawyers to partner since 2007, just before it rebrands and merges with US firm Hogan & Hartson in May. Twenty-one lawyers across its international offices have been made up, six of them from Asia and the Middle East. In 2007 the firm made up 31 lawyers to partner. The firm has four new partners in Hong Kong, one in Shanghai and one in Dubai (see table, below). The new partnerships come into effect on the day that Hogan Lovells officially launches, and with these additional partners the firm will have more than 800 partners located in offices across Asia, Europe, the Middle East and the US.
►► Lovells’ previous years’ elections to partnership Year
Number of partner promotions
2009
19
2008
18
2007
31
2006
18
2005
12
2004
15
2003
17
2002
19
2001
24
King & Spalding
King & Spalding grows Middle East practice with DLA, Trowers lawyers King & Spalding’s UAE offices have gained two new lawyers arriving from Trowers & Hamlins and DLA Piper. In Dubai, the firm has appointed Leroy Levy, Trowers’ former infrastructure partner and head of its Saudi practice. In Abu Dhabi, the firm has gained the head of DLA Piper’s Abu Dhabi construction and infrastructure practice, Timothy Burbury. King & Spalding’s new managing partner, Jawad Ali, who was appointed the position earlier this year, said the two new appointments would add more depth to his firm’s Middle East practice.
Herbert Smith
Herbies makes up three Asia lawyers to partner Three lawyers from Herbert Smith’s Asia offices have been made partners, as part of the firm’s annual partnership exercise. Tokyo disputes lawyer Gavin Margetson, Singapore energy lawyer Lewis McDonald and Shanghai arbitration lawyer May Tai will join the firm’s partnership in May. The rest of the partners have been made up outside of Asia, with 14 in Europe and only one Lewis McDonald in the Middle East – corporate lawyer Paul Scarr in Abu Dhabi. All up, the firm will have 272 partners as of May.
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NEWS >>
WongPartnership
Clyde & Co
Clyde & Co loses Qatar MP to WongPartnership In one of the Gulf’s most high-profile lateral moves this year, Singapore-based firm WongPartnership has secured Clyde & Co’s Qatar managing partner Andrew Watson. Watson Andrew Watson will join WongPartnership as cohead of its Middle East practice and will sit within the firm’s IP and media & technology practice. Watson will share the Middle East MP role with Paul Sandosham who has been at the helm of WongPartnership in the Gulf since it launched in Qatar in 2007. Watson, who has also spent time with Denton Wilde Sapte in Muscat, London and Brussels (where he was managing partner), also boasts strong credentials in the energy, infrastructure, trade and banking & finance sectors. According to the firm’s senior partner Alvin Yeo, Watson’s appointment is part of strategy aimed at expanding the firm’s Gulf offering “to beyond construction and corporate advisory areas”.
Freshfields
Freshfields promotes two Gulf lawyers to counsel Freshfields has promoted two Middle East-based lawyers to counsel – Abu Dhabi-based project finance lawyer Marc Fèvre and Dubai-based aviation finance lawyer William Coleman. In Asia, the firm has also promoted two finance lawyers to counsel – Hong Kong-based Robert Lonergan, and Tokyo-based Don Stokes. Middle East managing partner Joseph Huse said the new Gulf counsel will be expected to further develop the finance practice for the firm.
Dentons
Dentons looks to Middle East and Central Asia for promotions Denton Wilde Sapte has made up only two lawyers to partner as part of its annual promotion and both are based in the Middle East and Central Asia region. The numbers are down from last year when the firm made up six Victoria Simonova lawyers to partner.
26
The firm’s new partners are energy & infrastructure lawyers Ian McGrath in Oman, and Victoria Simonova in Kazakhstan. Chief executive Howard Morris said that the location and practice area of the new partners are significant: “[They’re] both based in our international offices [which] is a reflection of the sustained levels of growth we have seen and are supporting in the Middle East and Central Asia. It’s also no coincidence that they are both energy lawyers, as we expect this sector to grow significantly in the future,” he said.
Paul Hastings
Orrick
Paul Hastings loses China PE head to Orrick The head of Paul Hastings’ China PE practice Maurice Hoo has left the firm to become the co-head of global PE for Orrick in Hong Kong. Hoo will share the role with Orrick’s London partner Peter O’Driscoll. He is expected to bring his clients Maurice Hoo with him, among which are PE firm Warburg Pincus and AIG Investments. Orrick’s global corporate head, Don Keller, said the appointment will help his firm focus on international PE transactions while retaining a focus on Asia.
Clifford Chance
Minter Ellison Rudd Watts
CC’s Asia technology head returns to Kiwi roots Clifford Chance’s former head of TMT in Hong Kong has moved to New Zealand firm Minter Ellison Rudd Watts. Alison Lindsay – who spent a decade at the Magic Circle firm and headed its Asia TMT Alison Lindsay practice based in Hong Kong – has returned to the Kiwi firm, in which she worked prior to her appointment at Clifford Chance. As special counsel she will be expected to develop the TMT practice for the Auckland-based firm. Managing partner Mark Weenink said that the firm viewed the appointment as ‘fortunate’ as there was a high demand for international TMT specialists in New Zealand.
King & Spalding
Air Pacific
King & Spalding lawyer to head airline A former King & Spalding lawyer has been appointed CEO of the national airline of Fiji, Air Pacific. David Pflieger, an associate at the US firm in the late’ 90s, will leave his current post as Virgin America’s general counsel in May to head the Fijian airline’s operations as managing director and CEO. Since September 2006 Pflieger has been in charge of Virgin’s legal and government affairs, advising the company on employment laws, insurance clams and various other aviation and government compliance matters.
Tatweer
Grosvenor
Dubai Holding GC moves to UK property firm Corporate lawyer Ulrike Schwarz-Runer, the former general counsel of Dubai Holding subsidiary Tatweer Dubai, has moved to become the first general counsel of UK property development firm, Grosvenor Britain & Ireland. Schwarz-Runer will have responsibility over Grosvenor’s panel of external legal advisors and its international and domestic legal issues. Until 2009 she held the general counsel post at Tatweer Dubai. Last August the government-owned Dubai Holding announced a restructuring plan which included for Tatweer to be merged into a single unit. Before, Tatweer Schwarz-Runer was a corporate lawyer at Freshfields’ Vienna office and at Simpson Thacher & Bartlett’s New York office.
“Many Korean law firms pursue size first, merging with other firms to expand their services. But we take the opposite approach ... internal talent development [combined with] strategic lateral hiring”
Sai Ree Yun, Yulchon
Asian Legal Business ISSUE 10.5
NEWS >>
FINANCIAL INSTITUTIONS • ENERGY • INFRASTRUCTURE AND COMMODITIES • TRANSPORT • TECHNOLOGY
700 lawyers, 13 offices, one team Norton Rose Group in Asia Pacific
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Norton Rose Group has always served the needs of clients with interests in the Asia Pacific region. But now that Norton Rose Australia has joined forces with us, we’ll be even better placed. The move will create a major legal practice across the region. 700 lawyers in 13 offices to be precise. Our clients right around the world will benefit from a new wealth of resources, knowledge and contacts. www.nortonrose.com/asiapacific
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News | regional update >>
Regional updates
CHINA
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CHINA
Paul Weiss
Philippines
SyCip Salazar Hernandez & Gatmaitan
SINGAPORE Loo & Partners
Each month, ALB draws on its panel of country editors to bring readers up to date with regulatory developments across the region
New Tort Liability Law in China As of July 1, 2010, China will have a specific law to govern tort liability. The Tort Liability Law (“Tort Law”) provides a general outline on the tort liability over wide-ranging matters, including data and environmental protections and product liability. The Tort Law reiterates subscribers’ freedom to legally use telecommunications and confidentiality of their communication afforded under the PRC Telecommunications Regulations. Article 36 provides that network users and network service providers are liable for tortuous acts they commit when utilizing networks. A network user whose right is infringed may demand the service provider to make necessary deletion, screening and disconnection to stop the infringement. A network service provider who is aware of an infringement but fails to take any necessary corrective measure shall bear joint and several liability with the infringer. The Tort Law officially uses the term “punitive damages” in Chinese law. Prior to the promulgation of the Tort Law, manufacturers of defective products are under consumer rights protection and product quality laws to pay compensation or be fined at amounts equal to specified multiples of the products’ values. Article 47 provides that manufacturers and sellers who knowingly produced or sold defective products that cause death or serious health hazard are liable to pay punitive damages, without a specific limit. Articles 45 to 46 also give an additional protection to consumers with a right to request manufacturers and sellers to eliminate and remove danger of unsafe products. If defects are found in products already in circulation, manufacturers and sellers shall issue product warnings or, in severe cases, recall their products. Article 65 of the Tort Law introduces a no-fault based liability and stipulates that
any person who pollutes the environment and causes damage is subject to tort liability, without specifically being found in violation of any specific environmental regulation. The burden of proof is also switched to the defendants in these environmental cases. They have the burden to prove they should not be liable for the pollution, or certain mitigating factors should apply or that there is no causation between their acts and the pollution. While the Tort Law has made an attempt to address many tort liability matters, the general nature of the law has left many questions unanswered. For example, how an aggrieved party could pursue remedies and the standard of calculating remedies are not spelt out in the law. The issuance of further judicial interpretations and guidance are anticipated to fill the gaps and give teeth to the legislation. Written by Jeanette Chan, partner Kayleigh Mak, legal intern Paul, Weiss, Rifkind, Wharton & Garrison Hong Kong Club Building, 12th Floor 3A Chater Road, Central Hong Kong Email: jchan@paulweiss.com Ph: (8610) 5828-6300 or (852) 2846-0300
Philippines
Availment of Incentives by Foreign Investors – A surmountable challenge Foreign investments continue to play a significant role in spurring economic growth in developing countries, like the Philippines. While domestic trade and local business may have aided in cushioning the adverse effects of the worldwide economic crisis that found its way to Southeast Asian shores from the West, the benefits arising from foreign investments are, to say the least, undeniable. In line with this, governments of countries like the Philippines have made Asian Legal Business ISSUE 10.5
News | regional update >>
the promotion of foreign investments a cornerstone of their economic policies. Legislatures have passed laws providing for tax and other incentives aimed at attracting foreign investors. However, the challenge seems to be in the implementation of such laws. And this is where the role of lawyers, particularly local counsel, cannot be undermined. It is typical for foreign investors to seek assistance from local counsel for the purpose of availing themselves of tax and other incentives allowed in the host country. There are instances, however, when regulatory agencies become engaged in a tussle that hampers the processing and grant of incentives. In the Philippines for instance, one particular challenge is the power of a local chief executive to give consent to an endorsement which is required in order to qualify an applicant-company for incentives granted to locators in economic zones. In this regard, local counsel’s advice and assistance would be valuable. Arguments put forward by local counsel help shape decisions to be rendered by relevant government agencies in relation to applications for incentives. In turn, such decisions become precedents that would aid in the speedy resolution of similar issues in connection with future applications for incentives. It may be said that the more predictable the process of availing of incentives becomes, the more likely that a transaction involving foreign investments, in which the obtaining of incentives is a condition, would proceed to closing. In sum, attaining synergy, efficiency and predictability in the implementation of laws providing for incentives to foreign investors appears to be a challenge that developing countries like the Philippines need to hurdle in order to promote and sustain the inflow of foreign investments. However, such a challenge would be surmountable with the active participation of lawyers, particularly local counsel, in the processing of applications for incentives. Written By Benedicto P. Panigbatan SyCip Salazar Hernandez & Gatmaitan 3rd Floor, SSHG Law Center 105 Paseo de Roxas 1226 Makati City, Philippines T (632) 817 9811 to 20; 817 2001 to 09 F (632) 817 3896; 817 3567; 817 3145; 817 3570; 818 7562 E bppanigbatan@syciplaw.com W www.syciplaw.com
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SINGAPORE
Singapore receives boosts in fertility for growth of mergers and acquisitions (“M&A”) – M&A Allowance and remission of stamp duty for Qualifying M&A Deals entered into from 1 April 2010 Two years after worldwide M&A plunged into a deal famine, 2010 seems to be a time of valuable opportunity for those with an appetite for acquisitions. Recently, the market has been buoyant with good news of economic recovery pouring in. The Ministry of Trade and Industry announced on 14 April 2010 that it expects the Singapore economy to grow by 7.0 to 9.0 per cent in 2010. Prime Minister Lee Hsien Loong said Singapore’s economy made a remarkable recovery from a year ago and expects a good year going forward. Without a doubt, Singapore’s strong economic performance for the first quarter of 2010 has surpassed expectations with the speed of its rebound from the downturn. One of the strategies employed by the Government of Singapore to achieve higher productivity is to support the progressive restructuring of Singapore’s overall economy, towards higher-value, more competitive and more innovative players. The Government believes that it would be crucial to ensure a continuous flow of start-ups and new entrants into the economy, and to encourage the most efficient and competitive players the room to grow and scale up, through, amongst others, M&A. By creating a dynamic, innovative and viable small and medium-sized enterprise (“SME”) sector, the Government is hopeful that the SMEs may acquire the scale required to attract talent, invest in technologies and compete effectively in overseas markets.
Accordingly, the Government has announced in the budget speech of 2010 that it would be facilitating M&A by introducing a new one-off tax allowance scheme and the remission of stamp duty to help defray a portion of M&A costs. The M&A allowance will be equal to 5% of the value of the acquisition. For example, the acquisition of a $5 million company will give the acquiring company a tax allowance of S$250,000. The acquiror will be able to deduct the tax allowance against its taxable income over a period of 5 years. The M&A allowance will be limited to a maximum of S$5 million in a single year of assessment. As a further measure to reduce the costs of M&A, the Government will also be waiving stamp duty on the transfers of unlisted shares for such deals (which similarly, are executed from 1 April 2010 to 31 March 2015 (both dates inclusive)). The stamp duty waiver will apply to such deals worth up to S$100 million in any year. This one-off concession will also be available for five years. The M&A tax allowance and stamp duty remission will collectively cost about S$100 million per year. Internal Revenue Authority of Singapore will be releasing further details by June 2010. Further clarity on what constitutes a “qualifying deal” is eagerly awaited. Although speedier growth can be achieved through M&A, an M&A exercise could often be risky, costly and disruptive. Accordingly, the Government’s initiative is lauded as a welcome assistance to lowering the risk and costs of M&A to a more manageable level. As these tax incentives provide significant tax savings, Singapore companies should seriously evaluate available M&A opportunities and make hay while the sun shines. Written by Ms Wong Joy Ling and Ms Chris Ling Ms Wong Joy Ling, Foreign Counsel Senior Legal Associate (Corporate Practice) Ph: (65) 6322-2234 Fax: (65) 6534-0833 E-mail: wongjoyling@loopartners.com.sg and Ms Chris Ling, Foreign Counsel Legal Associate (Corporate Practice) Ph: (65) 6322-2231 Fax: (65) 6534-0833 E-mail: chrisling@loopartners.com.sg Loo & Partners LLP 88 Amoy Street, Level Three Singapore 069907
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ALB special report | Japan 2010 >>
JAPAN 2010
30
Asian Legal Business ISSUE 10.5
ALB special report | Japan 2010 >>
A financial crisis along with political and regulatory uncertainty may have slowed the Japanese economy in 2009 but half-way through 2010 fortune and renewed confidence is returning – for the country’s economy as well as its legal services market. ALB takes a look
A
t the depths of the economic downturn in 2009, domestic recovery seemed to be nowhere in sight. Unlike the seemingly unflappable emerging markets of India, China and South-East Asia, the situation in Japan was depressed and remained so for much of the first half of the year. It was compounded by nearly a decade of slow economic activity and an inexorable decline in staple sectors like real estate, flagging capital markets and political uncertainty. This confluence of factors had led many to suggest that the country was staring down the barrel of a ‘second downturn’ in 2010. But as Japan heads into the second part of the year, the worst of the financial crisis seems to have abated – as has talk of a second downturn. Dealflow has seemingly been restored (although, as in most other economies across the region, the mega-transactions have been replaced by a flood of smaller deals) and confidence has picked up. This has been evident to the extent that signs of life have even reappeared in the country’s ailing real estate sector. This is not to say that Japan’s economic fortunes have been completely reversed (think of the effect that highprofile corporate failures of Toyota and JAL has had on business confidence). There is lingering political uncertainty but the signs are positive for the nation’s economy this year, and are perhaps just as good for law firms in the country, many of whom have used
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the comparatively quiet times of 2009 to rebuild, restructure and refocus their practices.
2009: annus horribilis for foreign law firms in Japan?
That last year was a difficult year for law firms in Japan is no secret. A downturn in capital markets and real estate practices – and in some cases cross-border work – caused severe discomfort, the only answer to which was a drastic scaling back of operations. The result, of course, was mass layoffs, particularly at the associate and junior-lawyer level, as well as the repatriation of many foreign attorneys back to head offices or other branch offices within the region. “Some foreign law firms did it really tough over the past 12 months,” said one Tokyo-based partner at an international law firm. “Some firms, like Paul Hastings, Linklaters and Allen & Overy have been hit hard because their core areas were suffering.” This partner notes that while further layoffs by international firms are “unlikely” this year, many firms are still exploring ways to minimise the pressure on their bottom lines. “Some foreign law firms have sent associates and counsels on longterm or mid-term secondments to other international offices in the region,” the partner said. “I’ve heard of cases where gaiben have started to work two months in their Beijing or Shanghai office
►► Brighter times ahead for in-house lawyers in Japan In-house salaries in Japan remain flat in 2010 despite increased demand for corporate counsel, according to a report published recently by Japanese recruitment consultants Optia Partners. The report notes that although hiring activity was possibly at its lowest point for some time over the last 18 months, the legal services employment market seems to have bottomed out from Q2 2010, pointing to the fact that some companies have opened up new roles in regulatory and compliance, banking and insurance. In a trend that is identical to elsewhere in the region, foreign companies ( gaishekei) continue to out-pay their local equivalents by – in some cases – as much as 30%. But the jury is still out on whether foreign or local companies are better places to work for in-house lawyers. The report notes that while the culture within foreign companies means they still may be ahead in this regard, a number of local companies like Mitsubishi, Sony and Fujitsu are highly recommended for the excellent training programs they offer their legal staff.
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ALB special report | Japan 2010 >>
“We have seen more demand in areas related to the financial crisis. This means more work in insolvency and bankruptcy, as well as in regulatory and corporate crisis management” Akira Kosugi
Nishimura & Asahi
and then one month in Tokyo.” Yet this is not to say that all foreign law firms have suffered – in fact the performances of some firms has been impressive (for example, MoFo, Milbank and Herbert Smith). The downturn has provided a salutary lesson in practice management for international law firms in Japan, many of whom have already re-evaluated their strategies in the country. Whether this process will be successful depends on a number of factors, not least the continued economic recovery internationally and domestically, and whether international law firms who have entered the country with a view to servicing only a handful of practice areas, are capable of executing a strategic u-turn. “It will be quite difficult for some international law firms to regroup,” said the same partner. “There’s no doubt that some need to… but for a
firm that has entered [the market] on the understanding that they would do 80% [of their business in] realestate/finance work, it remains to be seen how easily they can restructure to do other things. I don’t know of many international law firms that have a client base, or head office, that flexible.” Nonetheless, this process of diversification is one that is seemingly already occurring in Japan. Most foreign law firms have reinforced their presence in dispute resolution and many Hisashi Hara are said to be eyeing Nagashima Ohno & Tsunematsu developments in the renewable and green energy spheres. “We have seen a number of deals in the energy space, particularly renewables – wind and solar energy” said Mark Weeks, managing partner of Orrick in Tokyo. “Japanese utilities are
►► Gaisekei versus Japanese Companies: Average salary by position 35
Foreign companies 30.44M
Japanese companies 30 M= millions of Yen
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20.09M
20 17.29M 15.87M 14.27M
15 11.4M 10
5.58M 5
5.23M
0 Legal staff
32
Legal manager
Legal counsel
Legal director/ general counsel Asian Legal Business ISSUE 10.5
ALB special report | Japan 2010 >>
keen to invest overseas because their markets here have been deregulated so there is more domestic competition.” Weeks also notes an upturn in enquiries from clients in the life sciences sector, where he says two-way investment levels will increase in the year ahead.
The local market
To suggest that local law firms in Japan have escaped the same pressures squeezing the bottom lines of their international counterparts would be incorrect. Domestic law firms were not immune from the drop-off in capital markets, structured finance and realestate work. But unlike many of their international counterparts, these law firms in Japan were better-placed to capitalise on the increased workflow in counter-cyclical areas like insolvency & restructuring and litigation, due to the ‘full-service’ nature of their practices. “Japanese law firms that handled a wide scope of business transactions have not been affected as badly during this crisis,” Masanori Sato says Masanori Sato, Mori Hamada & Matsumoto a partner with Mori Hamada & Matsumoto. “Of course the downturn in corporate and finance transactions affected firms, but depending on the size of their bankruptcy and insolvency practices they would have been able to limit this damage.” Akira Kosugi, managing partner of Nishimura & Asahi, shares Sato’s assessment of the market, noting that from what he had heard most firms had performed “much better financially than they had expected in 2009.” He notes that this is as much due to the increase in activity coming from the insolvency and restructuring areas as the emergence of new pockets of advisory work for domestic law firms. “We have seen more demand in areas related to the financial crisis. This means more work in insolvency and Akira Kosugi bankruptcy, as well as in Nishimura & regulatory and corporate Asahi www.legalbusinessonline.com
crisis management.” Hisashi Hara, of Nagashima, Ohno & Tsunematsu adds competition and antitrust to this practice list and is optimistic about the amount of work on Mark Weeks Orrick offer for local law firms in this area. “We are seeing strong demand in anti-trust because of the increase in cross-border transactions by Japanese companies,” he says. “As the economy stabilises and transaction levels pick up, this area will grow especially on the more sophisticated deals.” For example, in Panasonic’s recent tie-up with its ailing rival Sanyo, both Nagashima Ohno & Tsunematsu (Panasonic) and Mori Hamada & Matsumoto (Sanyo) were called on to provide Japanese competition law advice. This increased demand in newer areas of practice has forced many local firms into deepening the diversification of their practices. For instance, all of the ‘Big Four’ have a dedicated presence in areas like litigation and arbitration – whereas only one or two did five years ago. Of course, in tandem with this process has been renewed activity in staple areas of practice for local law firms in Japan. Crossborder volumes started to pick up from Q4 2009, and the capital markets saw small issues plus mega-global offerings – the likes of which had not been seen for almost two years in Japan. “M&A and capital markets activity should remain robust in the year ahead,” says Sato. “Just how robust is hard to predict – but we will most certainly see private equity and foreign funds return. Strategic M&A will continue and from what we can already see, calmer economic conditions will see Japanese companies continue to invest elsewhere in Asia, particularly in emerging markets in India, China and South-East Asia.” Hara also notes an upturn in enquiries from the Chinese. “Companies in mainland China – along with some in Singapore and Malaysia – have expressed interest in acquiring Japanese companies, mainly SMEs, particularly those with ready-made technology. This trend is something
“We have seen a number of deals in the energy space, particularly renewables – wind and solar energy. Japanese utilities are keen to invest overseas because their markets here have been deregulated, so there is more domestic competition” Mark Weeks Orrick
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ALB special report | Japan 2010 >>
“Quite a few local firms staffed up heavily in anticipation of banking & finance and M&A work taking off in 2009, meaning that they are now a little bottomheavy. This puts some in a difficult position. They need to trim staff numbers but probably aren’t ready to do this yet” Bonnie Dixon
Atsumi & Partners
that is heavily backed by the Japanese government.”
to make the endeavour worthwhile.” Yet it seems that Week’s enthusiasm is not shared by a majority of his international counterparts. In a quick Daniel Hounslow poll covering Tokyo Atsumi & managing partners of Partners major foreign firms, 94% said they would not be interested in opening a second office in Japan. But once you get out of Tokyo, finding the right people becomes a different proposition, says Atsumi & Partners’ Daniel Hounslow. “If you have a family there is major quality of life and quality of education difference between somewhere like Osaka and Tokyo,” he says.“This would make staffing an office out there very difficult for international law firms. There is good reason that most law firms in Tokyo do not have offices in Osaka.” Unsurprisingly, local lawyers feel that even if international law firms were to open additional offices in the country, its impact on the local market would be negligible. One partner at a local Japanese firm says he is confused about why this is necessary. “Perhaps it is just about giving foreign law firms equal treatment but I don’t think any will open branch offices in Japan, especially in light of the difficult period they have just been through.”
Further liberalisation on the cards?
Despite the general poor health of the international segment of the Japanese legal services market, further liberalisation could be on the cards – which may pave the way for foreign firms to open more than one branch office in the country. In mid April 2010, the Ministry of Justice (MOJ) announced its intention to update the current law which permits foreign law firms to have only one office in Japan in association with a domestic law firm. It is understood that the amendment would extend to foreign law firms the same rights as domestic law firms vis-a`-vis office expansion. Currently, local Japanese law firms are allowed to open more than one office in the country if they enter into a professional corporation. It is believed that the proposed amendments will be submitted to the Diet in the fourth quarter of this year and could come into effect from January 2012, meaning that foreign law firms could soon be opening offices in places like Osaka or Kyoto very Hiroo Atsumi soon. Atsumi & Partners Osaka is home to many major Japanese companies like Toyota, Osaka Gas and Panasonic, but it is underserviced by foreign law firms, says Weeks. “There are a lot of manufacturing clients in that [Western] region and very substantial client bases [there]. We will definitely look at [opportunities], but you really need to find the right people
Local challenges
Despite this spike in new areas and counter-cyclical areas of practice, Japanese companies face some challenges in the year ahead. Practitioners ALB spoke to note that although the upturn in work in these
►► IN-HOUSE legal Industry positions – japan Legal staff Min (JPYm)
34
Legal manager Max (JPYm)
Avg (JPYm)
Min (JPYm)
Legal counsel
Max (JPYm)
Advertising & consumer
4.5
7.0
Finance
4.0
8.0
5.7
Insurance
5.0
9.0
5.8
Life science
4.0
8.5
6.6
8.0
Manufacturing
4.0
8.0
5.6
5.0
Technology
3.5
8.0
5.5
5.5
24.0
6.3
8.0
Avg (JPYm)
12.0
10.5
7.0
24.0
10.0
20.0
Min (JPYm)
Legal director/general counsel
Max (JPYm)
Avg (JPYm)
8.5
25.0
13.7
14.0
7.0
50.0
13.4
11.0
20.0
16.0
11.7
10.0
22.0
11.2
9.0
12.7
12.0
25.0
Min (JPYm)
Max (JPYm)
Avg (JPYm)
13.1
28.0
19.5
20.1
12.0
100+
30.0
15.1
13.0
27.0
20.4
22.0
14.2
10.0
30.0
19.4
23.0
15.4
11.0
23.5
16.5
15.7
11.0
36.0
19.0
Asian Legal Business ISSUE 10.5
Firm Profile report | Japan 2010 >> ALB special
Mori Hamada & Matsumoto
Foreign insolvency proceedings in Japan
A
s a natural consequence of the Lehman shock back in 2008, many international business entities have become insolvent and have filed for legal proceedings in their respective jurisdictions in the past couple of years. In some instances, foreign insolvent companies which commenced their bankruptcy proceedings in their own jurisdictions have certain assets in Japan. Liquidators or administrators of these companies will be obligated to move such assets back to their countries and/or dispose of them in order to maximise the distribution of assets to creditors in compliance with the applicable bankruptcy laws. Some of these liquidators or administrators intuitively ask themselves the following question: does my appointment as liquidator/ administrator by the competent court with jurisdiction in my country give me authority over the debtor company in Japan? This article will give you an outline of the relevant law of which you should be aware when acting as a liquidator/administrator of an international entity which has certain assets in Japan.
Recognition Order and Assistance Order Even if the law under which you are appointed as a liquidator/administrator sets out that it will be applicable to the insolvent entity’s assets located in a different jurisdiction, Japanese law does not automatically recognize foreign legal proceedings or your authority in the Japanese territory. You must first obtain a Recognition Order from a Japanese court for the legal proceeding to be recognized by the court, in accordance with the Act on Recognition and Assistance for a Foreign Insolvency Proceedings (RAFIP Act.) This legal procedure is in line with the Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law (UNCITRAL), which requires
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such recognition from local courts before a foreign liquidator/administrator may act with authority in the territory. However, unlike the position under the UNCITRAL Model Law, the Japanese Recognition Order does not by itself result in automatic provision of certain assistance to foreign liquidator/administrator. In Japan, the Recognition Order is simply a precondition for obtaining one or more Assistance Orders. These include (i) an order to injunct an ongoing compulsory execution against debtor’s assets, (ii) an order to generally prohibit compulsory execution against debtor’s assets, (iii) a general prohibition of asset disposal and repayment of debts by the debtor, and (iv) an order to exclusively give asset disposal rights in Japan to the debtor-in-possession or foreignappointed liquidator/administrator (called an Administration Order). It is important that a foreign-appointed liquidator/administrator understands that he/she is not legally empowered to take control over or dispose of debtor’s assets located in Japan without first obtaining the Administration Order. Japanese law considers that the debtor’s assets can only be controlled or disposed of by the existing executive officers and does not automatically recognise the liquidator/administrator’s authority as given by a foreign legal system. Thus, in the case where a liquidator or administrator of a debtor sells debtor’s certain assets and re-patriates the proceeds to the company’s jurisdiction without first obtaining an Administration Order in Japan, it may be regarded as theft or embezzlement under Japanese criminal law.
Restriction on disposal rights Once an Administration Order is issued, the foreign liquidator/administrator will become an approved trustee under the RAFIP Act, and becomes the sole person who can control the debtor’s business and dispose
of the debtor’s assets in Japan. However, even having secured the Administration Order, the approved trustee must also obtain individual court approvals each time it wishes to dispose of debtor’s assets or transfer them beyond Japan’s borders. This restriction is intended to prevent unjust removal of such assets from Japan and to protect domestic creditors’ rights. From a foreign liquidators/ administrators’ standpoint, obtaining such individual approvals is quite burdensome and unnecessary, as they are already appointed as the authorised fiduciary of the debtor under the law of the relevant jurisdiction and are therefore obliged to meet their fiduciary obligations. This would seem to make any further imposition by the Japanese courts unnecessary. The author admits that it seems somewhat strange that the RAFIP Act requires individual approval for asset disposal to protect domestic creditors, since the court will have already recognized the foreign proceedings as fair and legitimate during the process of issuing the necessary Recognition Order. Having said that, it is not advisable to neglect the requirements of the RAFIP Act in taking the risk of committing theft or embezzlement under the Japanese law. If you think the individual approval of asset disposal is a redundant requirement in your case, you may want to specifically explain and exhibit to the Japanese court the fairness of the proceedings in your country and how the Japanese creditors would be equally treated thereunder. Then one could request that the Japanese court issues a “catch-all” approval to apply to all of the company’s assets, or that it expedites the future approval process. Accumulating these efforts would help rationalise the court practice and facilitate international bankruptcy practitioners’ activity in Japan in the future. Junichi Tobimatsu, partner Mori Hamada & Matsumoto email: junichi.tobimatsu@mhmjapan.com tel: +81-3-5223-7760
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ALB special report | Japan 2010 >>
has been noticeable, very few said that it compensated for the downturn being felt in other ‘fee-fat’ areas like M&A, banking & finance and real estate. As a number of observers pointed out, this may force many local firms into making difficult strategic decisions in the year ahead if they wish to preserve the growth that many have displayed such a penchant for over the last decade. But such decisions won’t come easily – as Bonnie Dixon, a partner with Atsumi & Partners, points out. “Quite a few local firms Bonnie Dixon staffed up heavily in Atsumi & anticipation of banking Partners & finance and M&A work taking off in 2009 meaning that they are now a little bottom-heavy,” she says. “This puts some in a difficult position. They need to trim staff numbers but probably aren’t ready to do this yet.” “Bottom-heavy” is something that a number of the country’s ‘top four’ admit to being, with many firms saying they
36
are looking at limiting the number of associates, junior lawyers or support staff they bring in over the next few months. While the lightning organic growth of previous years may not be attainable for many in 2010, many Japanese law firms may be well served by looking to growth of a different kind – the broadening of their international offerings. Offices in mainland China have been an important part of the international strategies of Mori Hamada and Anderson Mori, and now Nishimura & Asahi has announced it will open on the mainland in the coming months, but there is already a sense that Japanese firms must do more – especially as Japanese clients become increasingly active in markets like India and South-East Asia. Whether this would involve establishing additional branch offices is still unclear. Of all the local law firms ALB interviewed for this report, only Nishimura & Asahi’s Akira Kosugi admitted that his firm was “looking at the possibility of South-
East Asian offices.” Nonetheless, the process of internationalising one’s practice need not be only about opening offices across the region. It can start at home by bringing on board international lawyers who can often compensate for a firm’s lack of geographical coverage. One law firm that has been something of a pioneer in this regard has been Atsumi & Partners. In addition to having admitted the first foreign lawyer to partnership at a local law firm, the firm has a number of international lawyers in its ranks. “We have seen international work coming to us because of our foreign credentials… and because of this we are well positioned to take such business away from our competitors,” notes Hounslow. Regardless of what method is pursued, it is clear that this process of internationalisation is an important one for Japanese law firms. It is yet another way that local law firms can prove their worth in a market where clients are demanding more of it and competition is intensifying. ALB
Asian Legal Business ISSUE 10.5
Profile
The Celestine Hotel
The Celestine Hotel, Tokyo: Where guests are guaranteed a memorable stay
Nestled conveniently in the heart of Tokyo, only a stone's throw away from the Tokyo Tower, is the Celestine Hotel – a private healing spot of for business and leisure travellers alike. From its outstanding levels of service and world-class, modern facilities to its history (the hotel is built on the site of the Satsuma Palace of the Edo period) guests are guaranteed a stay they will never forget.
I
n a city as bustling and busy and Tokyo, the need for a quiet relaxed escape couldn’t be more important. The Celestine Hotel offers this and much more. And while the Celestine may be considered a ‘boutique’ hotel, everything about it, from its rooms and dining to its customer service and convenience, is five-star.
Sensory delight The Celestine Hotel is a sophisticated retreat in the heart of Tokyo which offers business and leisure travellers alike the opportunity to spend some ‘quality time’ with themselves. To recharge their batteries, relax their bodies and souls all while taking in the sights of one of the most beautiful cities on earth. The Celestine Hotel many guest rooms ooze relaxation. From the luxurious Simmons pocketed coil mattresses, to high ceiling, sound-proofed rooms each room at the Celestine Hotel is an oasis from the outside www.legalbusinessonline.com
world. In true Japanese style, not one comfort is omitted. Restaurant “Grand Cross” offers Japanese and Western Cuisines, it welcomes guests from around the world. And the Bar “Suazku” serves the world’s best alcoholic beverages including more than a hundred types of single malt whiskey. The comprehensive sensory experience that the Celestine Hotel offers its guests is rounded off delightfully by the wonderfully complex and rich art that adorns all corners of the hotel, a tranquil lounge and garden as well as three world-class restaurants and bars that cater for all tastes. Those who are historically inclined would also be interested to know that the Celestine is built on the site where the Satsuma Palace once stood (The palace where the princess “Atsuhime” related to the ruling Shogun lived). Although the Celestine may not have been around during this period, it stands on hallowed ground and can trace its roots back to the Tokugawa Shogun.
A Celestial experience Apart from this truly complete sensory experience, guests can also expect levels of service that leave some of the Celestine’s larger competitors in its wake. State-of-theart business, conference, entertainment and IT facilities are of course standard as are truly world-class customer service standards. The friendly, excellently trained, multi-lingual staff at the hotel guarantee that guests will spend each and every second of their stay at the Celestine Hotel in utter comfort. As always, it’s the little things that the Celestine does so well that set it apart from the rest. Travellers to the hotel are guaranteed a stay that will recharge the batteries while delighting the senses. In essence a stay at the Celestine Hotel in Tokyo is a truly memorable experience. The Celestine Hotel 3-23-1,Shiba Minato-ku,Tokyo 105-0014 Phone : +81-3-5441-4111 | Fax : +81-3-5441-4114
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FEATURE | Offshore firms >>
Offshore law firms:
Consolidation beckons
38
Asian Legal Business ISSUE 10.5
FEATURE | Offshore firms >>
W
hen ALB last reported on the status of the offshore legal services market, the ire of a small, but vocal, segment of the world community was directed squarely at offshore financial centres. World leaders decried the role that that offshore locations were playing in cultivating ‘shadow banking systems.’ But as the pressures of the financial crisis eased and some of the less transparent offshore financial centres outlined their commitment to cooperating more fully with onshore regulators across the world, talk of the inherent ‘evils’ of offshore financial centres dissipated. Instead it is replaced with odes to their importance, and a seemingly worldwide recognition of the integral role that they play in keeping the wheels of the world economy turning. “International financial centres play a vital economic role in the global economy. In fact, the economic recovery has been aided by transactions that happened in these centres,” says Hugh O’Loughlin, head of Asia Hugh O’Loughlin for law firm Walkers. Walkers “As Asia continues to grow and mature as a global financial centre, it is important that investors and financial institutions look to the range of options available to them – including the use of international financial centres.” It is this renewed interest in offshore financial centres as conduits for investment in lucrative emerging markets such as China, India, Russia, Africa and South America that has kept, and is continuing to keep, offshore law firms in Asia busy. But just as attitudes to offshore financial centres have moved on markedly from where they were in 2009, so too has the complexion of the offshore legal services market. Consolidation, merger activity, regulatory changes – as well as the emergence (and reemergence) of new areas of practice – have rendered the legal market hierarchy as fluid as it has been for some time.
www.legalbusinessonline.com
State of the market
‘Buoyant’ is perhaps the best way to describe the offshore market at the moment, with those lawyers ALB interviewed noting that they are seeing the full spectrum of work now, from GFC-related restructurings to an abundance of corporate work, funds and listing matters. Christine Chang, joint managing partner of Maples and Calder’s Hong Kong office says that while there is still some GFC-related work to come, firms are enthused by the increase in activity in other areas as well. “Having worked on a number of hedge fund restructurings, schemes of arrangement, and cross-border insolvencies during 2009, the first quarter of 2010 has, by contrast, brought a flow of new non-GFC related “new money” deals such as IPOs, new hedge fund start-ups and financings,” she says. “We are also seeing new “green energy” projects… dealflow is moving from the West to the East, with an increase in outbound Asian investment, particularly into emerging markets such as Latin America and Africa. 2010 marks a new era in terms of lessons learnt post-GFC.” Carol Hall, head of investment funds for Walkers in Hong Kong says that while Walkers still has a number of restructuring projects in the pipeline, the speed of Asia’s economic recovery has meant “steady growth in new fund formation, downstream spends, and corporate finance-related transactions.”
“We have also been approached to advise investors on their inward investment into Jersey listed companies. We expect to see a new trend in the use of Jersey and BVI entities, particularly from clients based in Russia and Europe” Frances Woo
Appleby
►► Largest offshore law firms*# 1 2 3 4 5 6 7
Firm
lawyers
partners
Offices
Appleby Maples and Calder Conyers Dill & Pearman Walkers Ogier Arendt & Medernach Harney, Westwood & Riegels
207 196
74 62
11 7
163
41
11
146 170 270
48 33 30
7 9 6
62
23
5
*Only offshore law firms with a presence in Asia are listed #Global lawyers figures used
39
FEATURE | Offshore firms >>
Listings
Practitioners are equally as optimistic about the prospect of recovery on the region’s capital markets, with many lawyers noting that the Hong Kong Exchange’s decision to relax the listing requirements for Jersey and British Virgin Islands (BVI) incorporated companies has generated a fair amount of interest. This is notable because both jurisdictions have been historically popular with Asia-based clients. “From a BVI perspective, this development has generated significant interest among our clients as it simplifies the listing process and provides a cost-efficient exit strategy for investors in BVI-incorporated companies,” said Maples’ Chang. “The HKEX listing development should encourage yet more investment in China through BVI companies.” It’s also worth noting that BVI companies provided the second-largest source of foreign investment in China (at US$5.8bn) for 1H09. But others say that Jersey is generating as much, if not more interest, among their clients. While it is certainly attracting more attention in Asia, historically BVI is the preferred jurisdiction, “as companies are better known and Asian clients, especially in China, have a comfort level with BVI,” saysDenise Wong, a partner with Walkers in Hong Kong. “That said, there seems to be more interest in using Jersey for HKEX listings, so it will be interesting to see what happens in the coming months.” Frances Woo, managing partner of Appleby in Hong Kong, adds that this should also see an increase in other types of investment related to BVI and Jersey-incorporated companies. “The relaxing of the listing rules for Jersey and BVI has been met with great interest… particularly within the private equity sector,” she says. “We have also been approached to advise investors on their inward investment into Frances Woo Appleby Jersey listed companies. We expect to see a new trend in the use of Jersey and BVI entities, particularly from clients based in Russia and Europe.” 40
But despite the positive signs surrounding this development, a “wait and see” approach may be needed until some of the finer details are ironed out, of which clarification on the Stock Exchange of Hong Kong’s Practice Note vis-a-vis BVI listings and what is needed to satisfy the nexus requirement between the BVI and the business and operations of the company being listed is the arguably the most pressing.
Islamic finance
Both Islamic financial institutions and issuers of Shariah-compliant financial products are searching for ways in which they can, inter alia, avoid taking on debt in excess of their share capital – especially in the context of sukuk. Offshore financial centres and law firms stand to benefit. “Islamic finance structures and sukuk transactions, in particular, are a growing source of business for offshore jurisdictions,” says Chang. “Many Islamic finance structures require offshore companies and vehicles to hold assets or issue securities as part of more complex arrangements. This is becoming an important market for the offshore industry.” But as Kerri Lefebvre, managing partner of Conyers Dill & Pearman in Dubai, is quick to point out, sukuk is not the only product that issuers are showing an interest in. “[While] the use of offshore companies continues to be popular for sukuk and other Islamic finance transactions… the use of offshore trust structures is increasing and offshore companies are also being used in wakala, murabaha and musharaka structures.” Growth of this area of offshore law is one that all of the major players are keen to secure a share of, but it is one that also presents immense challenges for practitioners. Most of the largest offshore law firms have hired lawyers who can advise on Shariah law over the last 12 months. As lawyers ALB interviewed have noted, given that the offshore component of Islamic finance transactions are but one of several parts of a structure, offshore firms will need to work closely with onshore firms and other jurisdictions. Chang says the other difficulty facing offshore law firms relates to holding
assets. She explains that offshore structures often require that assets be held in other jurisdictions. But many of the jurisdictions where Islamic finance is popular have strict local ownership laws, requiring complicated arrangements to be put in place before the offshore companies can hold the Christine Chang Maples and underlying assets. Calder In terms of offshore jurisdictions, the most popular centres to date have been Cayman, Jersey, Bermuda and Luxembourg – while Singapore and Hong Kong are also seen to be making positive inroads. Luxembourg, for example, has a long history with Islamic finance having been chosen to domicile the first Shariah-compliant insurance company in Europe in 1983. The Luxembourg Stock Exchange was also the first European stock exchange to enter the sukuk market, having listed since 2002. As at the end of 2009, 15 sukuk have been listed and traded on the Luxembourg Stock Exchange, and 39 Shariah-compliant investment funds and sub-funds have been established in the jurisdiction. While Luxembourg may be a popular destination for European and US issuers, for those in Asia and the Middle East, offshore markets with which they are already familiar are proving the most popular. “The Cayman Islands continues to be a leading choice of domicile for Islamic finance transactions,” says Conyers Lefebvre. “Bermuda’s reputation as a premier jurisdiction for aircraft registration and finance has enabled it to position itself as the jurisdiction of choice for sukuk and other Shariah-compliant structures, using aircraft as an asset base.” Appleby’s Woo adds BVI and Jersey to the list, saying that BVI’s popularity with Asian clients and Jersey’s “strong regulatory environment and reputation” mean they are also both well placed to develop their Islamic finance market in the future. However, the dark horse in this race is most surely the Malaysian federal territory of Labuan. Recently, the Labuan Financial Services Authority introduced a new regulatory framework for captive insurance, trusts and Asian Legal Business ISSUE 10.5
FEATURE | Offshore firms >>
foundations, as well as Islamic financial services and products. Director-general Azizan Abdul Rahman is confident that these new laws will boost business in the jurisdiction by 20% this year. And four new laws were enacted with comprehensive amendments made to four existing ones. “The profile of a jurisdiction will be raised once an important or landmark Islamic finance transaction is launched in such a jurisdiction,” said Lefebvre noting that the task for any offshore, or onshore, jurisdiction wishing to increase their market share of Islamic finance transactions must ensure that their tax laws do not put Islamic finance transactions at a disadvantage.
Further consolidation beckons?
By almost every measure, 2009 was a watershed year for the offshore legal services market. Mergers (such as Appleby’s acquisition of Dickinson Cruickshank and the impending merger between Mourant and Ozannes) as well the creation of a number of new firms
and office openings by others, have turned the offshore legal market status quo on its head. But despite the changes that have occurred over the past year, there is still a sense that this process of consolidation is incomplete and that the new status quo’s stay is temporary. “General business sense indicates that additional consolidation will be seen within the offshore legal market,” says Appleby’s Woo. “A strong combined and substantial firm has the financial, management and professional resources for clients to achieve efficiencies and economies of scale. We expect that to lead to further consolidation in due course.” Interestingly, others see consolidation of a different type occurring. Spencer Privett, joint managing partner of Maples and Calder in Hong Kong, says “the number of sustainable offshore jurisdictions is declining. Rather than work coming from an increasing number of offshore centres, we believe that offshore business will consolidate into a few leading jurisdictions such
“As Asia continues to grow and mature as a global financial centre, it is important that investors and financial institutions look to the range of options available to them – including the use of international financial centres”
Navigating offshore options can be tricky. Appleby offers our clients skilled advice and a depth of knowledge across our offshore jurisdictions. Our Hong Kong office has been guiding clients
Hugh O’Loughlin
Walkers
Bahrain Bermuda British Virgin Islands
to the best options for Asian, Indian and African
Cayman Islands
investment for over 20 years. That’s what we offer
Guernsey
clients and why we continue to grow. We are pleased to announce the opening of our new Guernsey office. Unparalleled jurisdictional reach and trusted advice. Appleby. For further information, please contact: Frances Woo, Managing Partner, Hong Kong Tel: +852 2905 5720 Email: fwoo@applebyglobal.com
Hong Kong Isle of Man Jersey London Mauritius Seychelles Zurich
THE RIGHT PEOPLE. THE RIGHT PL ACES. THE RIGHT GUIDANCE. Offshore Legal, Fiduciary & Administration Services
www.legalbusinessonline.com
applebyglobal.com
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Firm Profile FEATURE | Offshore firms >>
Walkers
Arwel Lewis, looks at current trends in the Asian private equity industry Background
U
nsurprisingly, given the global economic landscape of the last few years, the private equity industry experienced a turbulent time in 2009, reflected by a challenging capitalraising environment for new private equity funds and a reluctance to call on investors to commit funds to new portfolio investments. General partners and managers also tell us that they had to commit significant time to the monitoring and restructuring of existing investments, which have been a drain on resources that could otherwise have been deployed on new fund raising or investments. However, promising signs during the first quarter of 2010, particularly in Asia, give grounds for optimism. Improvements in both the economy and stock indices (the Hang Seng Index crossed the 22,000 threshold in mid-April 2010, doubling from the lows of October 2008), a cautious re-emergence of leverage from the debt markets, improved business confidence and China’s continued economic growth and perceived role in leading the global economic recovery, has led to a marked increase in activity in the Asian private equity environment.
New Funds Large funds are making a re-appearance. Among the recently reported deals is the US$2.55 billion Carlyle Asia Partners III, one of the biggest private equity funds in the region since the height of the global financial crisis in 2008, which reportedly includes large institutional investors from around the world, including the U.S., Europe, Middle East and Asia. We have also seen a greater number of small and mid-market fund launches, seeking more achievable fund sizes and specifying more focused sector and geographic investment guidelines. Particular sectors that appear popular include infrastructure, healthcare, new energy and commodities, as well as the more traditional real estate funds. Unsurprisingly, China is the dominant geographic focus. In our experience there has also been several notable joint ventures between financial institutions and corporates with expertise in the fund’s targeted investment sector and geographic focus. The combination of the former’s access to capital and the
42
latter’s industry contacts and knowledge, proving attractive. The eagerness of large Chinese financial institutions to invest in and to sponsor their own Cayman Islands funds has also led to increased work flows. Generally speaking, a number of Walkers’ clients are working toward substantial closings, which supports a more positive outlook for capital deployment in the second half of 2010.
Fund Raising Trends On the fund raising side, some trends are becoming increasingly apparent. Investors are aggressively targeting fees payable to the general partner and fee free-periods are commonly demanded from funds. In addition, lengthier and more complex clawback provisions, enabling investors to recoup fees previously paid to the general partner, are becoming more common place, with some arrangements involving fees being paid into escrow to give investors greater comfort that the clawback obligations will be met. Investors are also becoming more focused on corporate governance and the ability to ensure that the investments pursued by their funds comply with various ethical standards. As a result, the frequency of side letters between the general partner and investors appears to be increasing, and the provisions of those side letters are becoming lengthier and more complex, perhaps reflecting the eagerness of general partners to secure investor’s commitments.
Investments and Exit On the investment side, there have been a number of high profile Asian public to private investments, including Carlyle’s successful investment in Natural Beauty Bio-Technology. In addition, Walkers investment funds team in Hong Kong and Singapore have been involved in a number of significant Pre-IPO investments, structured through subscriptions in convertible bonds, or perhaps more commonly, preference shares. As deal flow has started to return, the range of potential exit opportunities has widened, particularly with the recovery in global stock markets. As debt finance opportunities improve, trade sales have also become more realistic options. Private equity and venture capital owned companies featured strongly in a wave of IPOs over the last six months (Carlyle investee
Arwel Lewis
companies China Forestry Holdings and Kaisa Group, and The Jordan Company’s exit from International Mining Machinery, being prime examples), as firms looked to release value from investments made over the past few years, a trend that is expected to continue during 2010.
RMB Funds Finally, RMB Funds, structured as PRC partnerships seeking investment in yuan, as opposed to the market standard Cayman Islands partnerships (raising US Dollars), are also firmly in focus, following recent high profile announcements by US private equity giants Carlyle and Blackstone that they have teamed up with partners in the PRC to form and manage funds. The market awaits with interest whether the current legal and regulatory hurdles to allow foreign investors to invest directly in RMB funds, and to negotiate the applicable foreign exchange restrictions, can be overcome. Until those issues can be definitively addressed in legislation, it seems likely based on our experience, that the Cayman Islands and the Cayman Islands exempted limited partnership will remain as the jurisdiction and structure of choice for new fund structures in Asia. Arwel Lewis is a senior associate in the Investment Funds team in the Hong Kong office of Walkers, one of the leading offshore law firms practicing Cayman Islands, British Virgin Islands and Jersey law.
15th Floor, Alexandra House 18 Chater Road Central, Hong Kong T +852 2596 3319 F +852 2284 4560 arwel.lewis@walkersglobal.com Asian Legal Business ISSUE 10.5
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FEATURE | Offshore firms >>
www.legalbusinessonline.com
43
FEATURE | Offshore firms >>
as the Cayman Islands and the BVI,” he said. “Our view is that the more recently established jurisdictions have attracted business as a result of their network of Double Taxation Treaties (“DTTs”). With increased focus on maximising tax collections in many onshore jurisdictions, Spencer Privett national tax authorities Maples and are starting to deny Calder tax treaty benefits to entities which do not have substantive operations in the relevant offshore jurisdiction. Privett cites changes to tax practice in the PRC as an example, saying that the issuance of Circular 601 by the Chinese State Administration of Tax has introduced uncertainty in assessing a claim for DTT tax benefits, for a typical vehicle established in an offshore jurisdiction such as Barbados or the Seychelles. “As the likelihood of successfully claiming DTT benefits diminishes, Cayman and the BVI will
find themselves on the same playing field with regard to taxation as the DTT jurisdictions.” But while there will always be competition for work between offshore financial centres, there has perhaps never been more of a need for them to cooperate as well. To this end, a firm dialogue has already been established through the International Financial Centres Forum, an organisation formed in December 2009 by a group of offshore law firms including Appleby, Conyers, Mourant, Ogier and Walkers. “We see more cooperation among offshore jurisdictions and law firms,” says John Rogers, head of finance for Walkers in Singapore. “The best example of this is the formation of the IFC… [which] aims to present a more coordinated response to the political rhetoric aimed at offshore financial centres, so that policy makers fully understand the positive contributions that IFCs make to the global economy and the potential consequences of restricting their activities.” ALB
“After a number of hedge fund restructurings, schemes of arrangement, and cross-border insolvencies during 2009, the first quarter of 2010 has, by contrast, brought a flow of new non-GFC related “new money” deals such as IPOs, new hedge fund start-ups and financings” Christine Chang
Maples and Calder
ROBERTSON JOINS TOP TEAM • Everton Robertson will join Richard Thorp and Harriet Unger in Thorp
Alberga’s newly opened Hong Kong office from 1 June 2010. Previously with Linklaters and Shearman & Sterling, Everton was most recently a private equity partner in Walkers’ Hong Kong office.
• Everton focuses on pre-IPO financing, private equity, M&A and capital
markets and is admitted in both Cayman and the British Virgin Islands. Everton has acted for major financial institutions, corporates and private equity firms throughout Asia.
• Thorp Alberga is a boutique law firm offering
Cayman Islands and BVI legal advice from our Hong Kong office.
2606 The Centrium 60 Wyndham Street Central, Hong Kong Tel: +852 2801 6066 Fax: +852 2801 6767
Harbour Place South Church Street, George Town Grand Cayman, Cayman Islands Tel: +1 345 949 0699 Fax: +1 345 949 8171 www.thorpalberga.com
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Asian Legal Business ISSUE 10.5
FEATURE | Offshore firms >>
www.legalbusinessonline.com
45
EVENTS | Japan Law Awards >>
28 May 2010, Ritz Carlton, Tokyo
www.albawards.com
►► JAPANESE FIRMS - LEADING FINALISTS Firm Mori Hamada & Matsumoto
No. 21
Nagashima Ohno & Tsunematsu
17
Nishimura & Asahi
16
Anderson Mori & Tomotsune
14
Oh-Ebashi
2
Law firm awards Dispute Resolution Insolvency IP
Dispute Resolution
Dispute Resolution Insolvency
Dispute Resolution Insolvency IP
Osaka
Deal awards Equity Market M&A Real Estate TMT Japanese Dealmaker Japanese Deal Team Japanese Deal Firm Debt Market Equity Market M&A TMT Japanese Dealmaker Japanese Deal Team Japanese Deal Firm Debt Market Equity Market M&A Real Estate TMT Japanese Deal Team Japanese Deal Firm Debt Market Equity Market Real Estate TMT Japanese Dealmaker Japanese Deal Team Japanese Deal Firm M&A
►► THE BANKS - LEADING FINALISTS Bank Goldman Sachs Nomura Morgan Stanley Citigroup Sumitomo Mitsui Daiwa Securities JPMorgan Mizuho Securities UBS Shinsei Bank
►► INTERNATIONAL FIRMS - LEADING FINALISTS Firm
No.
Sullivan & Cromwell
15
Simpson Thacher & Bartlett
14
Law firm awards
Debt Market Equity Market M&A TMT International Dealmaker International Deal Firm Equity Market M&A Real Estate TMT International Dealmaker International Deal Firm
Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise)
8 Insolvency
Davis Polk & Wardwell
8
Equity Market M&A Real Estate TMT International Dealmaker International Deal Firm
Paul, Weiss
7
Equity Market M&A International Dealmaker International Deal Firm
Skadden
6
M&A Real Estate
Linklaters Tokyo
5
Debt Market Equity Market International Deal Firm
Morrison & Foerster
4 Dispute Resolution IP
Debt Market International Dealmaker
Maples and Calder
4 Offshore
Equity Market
Walkers
3 Offshore
Debt Market Real Estate
No. 10 10 8 7 7 6 6 6 6 4
Debt Market Equity Market M&A Real Estate TMT
►► The ALB Law Awards series – global recognition for Asia’s legal excellence ALB China Law Awards Shanghai 16 April 2010
ALB Japan Law Awards Tokyo 28 May 2010
ALB Australasian Law Awards Sydney 13 May 2010
ALB SE Asia Law Awards Singapore 4 June 2010
ALB Hong Kong Law Awards Hong Kong 10 September 2010
www.albawards.com: for table bookings please visit www.albawards.com or call +852 2815 5988
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deals of the year
Deal awards
DEBT MARKET DEAL OF THE YEAR Finalists ►► Électricité de France Samurai Bond Offering Firms: Anderson Mori & Tomotsune; Lovells; Shimazaki International Law Office Banks: Mitsubishi UFJ Financial Group Accountants: Deloitte; KPMG Why: • Samurai bond offering worth JPY110bn consisting of four series • involved a number of technical legal issues, including complex matters relating to disclosure • first issue ‘post-Lehman shock’, confirmed gradual recovery of Japanese capital markets • “bellwether” debt market deal ►► Japan Finance Corporation Global Bond Offering Firms: Nagashima Ohno & Tsunematsu; Sullivan & Cromwell Banks: Bank of America Merrill Lynch; Barclays Capital; Deutsche Bank; JPMorgan; Morgan Stanley Why: • two-part issue of guaranteed bonds totaling US$5.5bn • first issue by the newly restructured Japan Finance Corporation • carried out successfully despite market instability ►► Kenedix Global Convertible Bond Offering Firms: Linklaters Tokyo; Nagashima Ohno & Tsunematsu Bank: UBS Why: • exchange offer with respect to JPY20bn convertible bonds, and concurrent global offering of new shares • first exchange offer for EuroCB by Japanese issuer, and financed by concurrent share offer • “highly complex” deal that employed new techniques ►► Secured Capital TMK Bond Buyback Firms: Morrison & Foerster; Walkers; White & Case Why: • tokutei mokuteki kaisha (TMK) bond buybacks are rare, subject to very high levels of regulation • complex and innovative transaction was perhaps the first such transaction in Japan Asian Legal Business ISSUE 10.5
EVENTS | Japan Law Awards >>
2009 was for the Japanese legal services industry inseparable from ‘Lehman shock’ fallout, but that did not stop the country’s best domestic and international firms and in-house departments from completing transactions that were, at times, no less than dazzling in their scope and complexity. Now in their sixth consecutive year, the ALB Japan Law Awards recognise and reward the firms, teams and individuals who produced the best legal work across the year. Here are the deserving finalists across 24 important categories
• bonds purchased at JPY7.6bn, approximately 55% off the face value of JPY16.8bn ►► USJ Buyout Financing Firms: Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise); Nagashima Ohno & Tsunematsu; Nishimura & Asahi Banks: Bank of Tokyo Mitsubishi UFJ; Chuo Mitsui Trust & Banking; Calyon Bank; Development Bank of Japan; GE Financial Service; Goldman Sachs; Mizuho Corporate Bank; Nomura; Sumitomo Mitsui; Sumitomo Trust & Banking Why: • largest buyout in Japan in 2009; financing co-arranged by nine financial institutions (including three Japanese mega-banks) • complicated deal structure involving multi-layered comprehensive security package, and dealing with electric share pledge registration for first time in Japan • transaction carried out shortly after ‘Lehman shock’, special precautions taken to ensure fairness of entire process
Equity Market Deal of the Year FINALISTS ►► Elpida Memory Global Offering Firms: Mori Hamada & Matsumoto; Nishimura & Asahi; Simpson Thacher & Bartlett; Sullivan & Cromwell Bank: Morgan Stanley Why: • US$630m global offering undertaken in extremely difficult DRAM industry environment • handled in parallel with government capital injection under a business restructuring plan, ongoing negotiation with Taiwanese government for establishment of strategic technology partnership, and syndicated loan negotiation with banks • each element of deal inter-related and affected realisation of offering ►► Hitachi Global Offering Firms: Anderson Mori & Tomotsune; Davis Polk & Wardwell; Mori Hamada & Matsumoto; Sullivan & Cromwell Banks: Goldman Sachs; Nomura Accountants: Ernst & Young ShinNihon Why: • US$3.9bn combined stock and convertible bond issue both in Japan and abroad • one of the biggest equity offerings by any Japanese issuer seen in 2009 • first transaction in Japan in which shares and convertible bonds were issued in simultaneous offerings; this www.legalbusinessonline.com
groundbreaking structure meant Hitachi could raise capital while avoiding large-scale dilution of earnings per share • Hitachi subject to extensive governmental regulation and disclosure obligations, resulting in various legal conflicts and need for active reconciliation • took place against complex background of corporate restructuring ►► Mitsubishi UFJ Global Offering Firms: Maples and Calder; Mori Hamada & Matsumoto; Nagashima Ohno & Tsunematsu; Paul, Weiss; Simpson Thacher & Bartlett Banks: Daiwa Securities; JPMorgan; Mitsubishi UFJ Financial Group; Morgan Stanley; Nomura Accountant: Deloitte Why: • US$12.1bn offering is largest follow-on offering by Japanese issuer, and largest securities offering in Japan seen since 1998 • offering was completed in a challenging business environment and made simultaneously in three jurisdictions • innovative in relying upon exemption from registration requirement under US Securities Act while the ADRs of MUFG are listed on NYSE ►► Mizuho Financial Group International Offering Firms: Anderson Mori & Tomotsune; Maples and Calder; Nagashima Ohno & Tsunematsu; Simpson Thacher & Bartlett; Sullivan & Cromwell Banks: Bank of America Merrill Lynch; Goldman Sachs; JPMorgan; Mizuho Securities; Morgan Stanley; Nomura; UBS Why: • US$4.8bn global offering of common shares, including offering in US to certain qualified institutional buyers in reliance on Section 4(1-1/2) doctrine • one of largest securities offerings by Japanese corporation in 2009 • made simultaneously in three jurisdictions ►► NEC Common Stock Offering Firms: Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise); Davis Polk & Wardwell; Linklaters Tokyo; Nagashima Ohno & Tsunematsu; Paul, Weiss Banks: Daiwa Securities; Morgan Stanley Accountant: KPMG Why: • large-scale global offering (approximately US$1.2bn) • completed in challenging business environment ►► Nomura Global Offering Firms: Anderson Mori & Tomotsune; Linklaters Tokyo; Sullivan & Cromwell; Simpson Thacher & Bartlett
Banks: JPMorgan; Nomura Accountant: Ernst & Young ShinNihon Why: • US$5bn global offering followed but was larger than similar offering made earlier in year by Nomura; successfull despite extremely uncertain market conditions • allowed Nomura to kickstart the businesses it had acquired from Lehman and invest aggressively in its overseas operations • structured and implemented on an extremely tight schedule, and contained a number of complex legal issues ►► Sumitomo Mitsui Global Offering Firms: Davis Polk & Wardwell; Linklaters Tokyo; Maples and Calder; Nagashima Ohno & Tsunematsu; Simpson Thacher & Bartlett Banks: Barclays Capital; Citigroup; Daiwa Securities; Goldman Sachs; JPMorgan Accountant: KPMG Why: • very large-scale global offering (US$9.2bn) • conducted concurrently with large-scale acquisition of Nikko Cordial Securities • extremely significant for Japanese market both because of its timing and size – at the time, largest common stock offering by Japanese bank and third-largest stock offering by Japanese company
Canadian Chamber of Commerce IN Japan Award M&A Deal of the Year
Finalists ►► Mitsui Sumitomo-Aioi-Nissay Dowa Insurance Business Combination Firms: Mori Hamada & Matsumoto; Nishimura & Asahi; Paul, Weiss; Skadden; Simpson Thacher & Bartlett; Sullivan & Cromwell Banks: Citigroup; Morgan Stanley Why: • scale of transaction (combined market value of about US$15.6bn) required significant due diligence for parties to set appropriate share exchange rate; and involved careful SEC analysis given three parties involved in transaction each had different shareholder structure • considered milestone in non-life insurance industry in Japan and has received extensive publicity • newly formed non-life insurance group will be top player in Japanese non-insurance market, and fifth largest globally
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EVENTS | Japan Law Awards >> www.albawards.com
►► Nikko Asset Management & Nikko Citi Trust Sale Firms: Kim & Chang; Mori Hamada & Matsumoto; Nagashima Ohno & Tsunematsu; Paul Hastings; Paul, Weiss; Skadden; Sullivan & Cromwell Bank: Citigroup Why: • Citigroup sold NAM and NCT to different acquirors on parallel auction processes, with the deal closing on same day; combined value of JPY139bn (US$1.5bn) • related sale to Sumitomo Mitsui of Nikko Cordial Securities had a complicated impact on the sale of NAM and NCT • challenge was to coordinate multiple dispositions to ensure smooth execution, protecting transaction value while facilitating speedy and simultaneous completion ►► Nippon Mining-Nippon Oil Business Integration Firms: Davis Polk & Wardwell; Mori Hamada & Matsumoto; Nishimura & Asahi; Ropes & Gray; Shearman & Sterling; Simpson Thacher & Bartlett; Sullivan & Cromwell Banks: Bank of America Merrill Lynch; Daiwa Securities; JPMorgan; Mizuho Securities; Nomura; UBS Accountant: Ernst & Young ShinNihon; PwC Why: • involved two giant oil companies combining their businesses, and was substantial in size • joint share transfer structure is uncommon in a transaction registered with the SEC; disclosure more complex than usual because it included SEC considerations • tax treatment extremely challenging because dependent on actions that the yet-to-be-formed holding company would take after Nippon Mining and Nippon Oil become its subsidiaries • required high degree of coordination between companies and their counsels because it was merger of equals and as both companies have presences in many countries ►► Panasonic-Sanyo Electric Acquisition Firms: Arnold & Porter; Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise); Mori Hamada & Matsumoto; Nagashima Ohno & Tsunematsu; Nishimura & Asahi; Simpson Thacher & Bartlett; Sullivan & Cromwell; Weil Gotshal & Manges; Zhong Lun Banks: Daiwa Securities; Goldman Sachs; Mitsui Sumitomo Why: • JPY400bn (US$4.6bn) bid succeeded as Sanyo’s top three shareholders – Goldman Sachs, Daiwa Securities and Sumitomo Mitsui Banking Corporation – agreed to sell portions of their shareholdings into the tender offer • subject to careful anti-trust review in various jurisdictions such as the US, EU, Japan and China, where transaction was cleared conditional upon certain remedies • conducted by way of public tender offer targeting not only listed common shares but also unlisted preferred shares; very uncommon, hence involved certain complex legal issues ►► Sompo Japan Insurance-Nipponkoa Insurance Acquisition Firms: Mori Hamada & Matsumoto; Nishimura & Asahi; Shearman & Sterling; Skadden; Sullivan & Cromwell Bank: Goldman Sachs Why: • US$5bn acquisition through share exchange between a new holding company • resulted in single non-life insurance group, third-largest in Japan, with total revenue of approximately JPY2.9trn (US$31bn) ►► Sumitomo Mitsui Banking-Nikko Cordial Securities Acquisition Firms: Nagashima Ohno & Tsunematsu; Nishimura & Asahi; Paul, Weiss; Skadden; Simpson Thacher & Bartlett Banks: Citigroup; Goldman Sachs Accountant: Ernst & Young Why: • US$7.8bn acquisition was first attempt by one of Japan’s
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mega-banks to acquire one of large Japanese securities firms • structure (formation of Newco and demerger (kaisha bunkatsu ) to Newco at closing) quite challenging as relevant sectors (in particular banks) are highly regulated and concentrated • involved acquisition of related businesses from all over the world, with various post-acquisition business arrangements arising from division of wholesale securities business, all of which required careful analysis and management of various complex regulations and legal issues ►► Yoshimoto Kogyo Privatisation Firms: Mori Hamada & Matsumoto; Nagashima Ohno & Tsunematsu; Oh-Ebashi; Sullivan & Cromwell Banks: Mizuho Securities; Nomura; Softbank; Sumitomo Mitsui; Sumitomo Trust & Banking Accountant: PwC Why: • one of largest (US$458m) leveraged buy-out deals closed in 2009 in Japan • complex LBO with both debt and preferred equity financing • unique because it was not led by certain PE fund nor was it pure management buy-out; rather it was sponsored by many media and telecoms companies, which led to greater complexity
Real Estate Deal of the Year Finalists ►► AIG Otemachi Building Sale Firms: Anderson Mori & Tomotsune; Nishimura & Asahi; Simpson Thacher & Bartlett Why: • JPY115bn (US$1.2bn) acquisition of premier address in Tokyo’s central business district • more interested parties than in typical real estate sale because seller of land was different from seller of building and upperlevel seller entity was being monitored by US government • high-profile due to AIG’s long history in Japan ►► Forum Partners-Galileo Japan Trust Investment Firms: Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise); Clifford Chance; Skadden Banks: Citigroup; Shinsei Bank Accountant: PwC Why: • US$650m deal one of few “new money” deals for Japanese real estate investment in 2009 • mezzanine funding was very novel, using bond structure for tax efficiencies • bonds have conversion mechanism which allows investor to convert bonds into TK (silent partnership) interest in property investment, thereby providing equity kicker for bondholder ►► Mitsubishi Estate-Towa Real Estate Acquisition Firms: Davis Polk & Wardwell; Mori Hamada & Matsumoto; Nishimura & Asahi Banks: Mizuho Securities; Nomura Why: • JPY10bn (US$110m) stock-for-stock acquisition of remaining 21% of Towa that Mitsubishi didn’t already own • as US residents held some outstanding shares, a recently revised exemption under US securities law was relied upon for this transaction • groundbreaking deal that many subsequent Japanese deals followed in this form in 2009 ►► Pacific Century Place Marunouchi Building Acquisition Firms: Anderson Mori & Tomotsune; Skadden; Walkers; White & Case Why: • JPY140bn (US$1.55bn) deal was largest property acquisition deal after ‘Lehman shock’
• issuer was property acquisition SPC in form of a tokutei mokuteki kaisha (TMK), so heavily regulated; in addition, it is unprededented for TMKs to issue secured bonds • no “market standard” for bond security trust deed, so one was crafted especially for this transaction ►► Shinsai-bashi Osaka Building Acquisition Firms: Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise); Conyers Dill & Pearman; Nishimura & Asahi; Vinson & Elkins Banks: Mizuho Securities; Shinsei Bank Why: • JPY5bn (US$50bn) deal to acquire twin “Shinsai-bashi” building in Osaka • financing used Japanese SPC (TMK) structure
TMT Deal of the Year Finalists ►► Bellsystem24 Firms: Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise); Mori Hamada & Matsumoto; Nagashima Ohno & Tsunematsu; Nishimura & Asahi; Ropes & Gray; Simpson Thacher & Bartlett Banks: Bank of Tokyo Mitsubishi UFJ; Citigroup; Goldman Sachs; Mizuho Corporate Bank; Nikko Cordial Securities; Sumitomo Mitsui; UBS Accountant: PwC Why: • US$1bn+ leveraged tender offer acquisition part of highly competitive auction involving more than 12 bidders • largest buyout by foreign PE firm in Japan in almost two years • not being able to close if tender offer conditions were met would have resulted in significant penalties for bidder; to reduce this exposure, “certain funds” commitments were obtained from lenders, which is very unusual for tender offer in this market ►► eAccess-ACCA Merger Firms: Anderson Mori & Tomotsune; Mori Hamada & Matsumoto; Shearman & Sterling Banks: Lazard Freres; Nikko Cordial Securities Why: • JPY2.2bn (US$24m) merger was final step in business combination of eAccess and ACCA following third-party allotment and tender offer • highly complex and cutting-edge M&A issues affecting the whole series of transactions • involved advice on US securities regulations, resulting in eAccess successfully taking steps to obtain exemption from registration requirements ►► Hitachi Global Offering Firms: Anderson Mori & Tomotsune; Davis Polk & Wardwell; Mori Hamada & Matsumoto; Sullivan & Cromwell Banks: Goldman Sachs; Nomura Accountant: Ernst & Young ShinNihon Why: • US$3.9bn combined stock and convertible bond issue both in Japan and abroad • one of biggest equity offerings by any Japanese issuer in 2009 • first transaction in Japan in which shares and convertible bonds were issued in simultaneous offerings; this groundbreaking structure meant Hitachi could raise capital while avoiding large-scale dilution of earnings per share • Hitachi subject to extensive governmental regulation and disclosure obligations, resulting in various legal conflicts and need for active reconciliation; took place against complex background of corporate restructuring ►► Panasonic-Sanyo Electric Acquisition Firms: Arnold & Porter; Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise); Mori Hamada & Matsumoto; Nagashima Ohno & Tsunematsu; Nishimura & Asahi; Simpson Asian Legal Business ISSUE 10.5
EVENTS | Japan Law Awards >> www.albawards.com
In-house awards
Law Firm awards
Banking & Financial Services In-House Team of the Year
Dispute Resolution Law Firm of the Year
FINALISTS
FINALISTS
• Mitsubishi UFJ Securities • Shinsei Bank • Sumitomo Mitsui
• Anderson Mori & Tomotsune • Herbert Smith • Mori Hamada & Matsumoto • Morrison & Foerster • Nagashima Ohno & Tsunematsu • Nishimura & Asahi
Japanese Investment Bank In-House Team of the Year FINALISTS
FINALISTS
• Citigroup • Daiwa • Mitsubishi UFJ Securities • Mizuho Securities • Nomura
• Anderson Mori & Tomotsune • Baker & McKenzie GJBJ Tokyo Aoyama Aoki Koma Law Office (Gaikokuho Joint Enterprise) • Bingham McCutchen • Mori Hamada & Matsumoto • Nishimura & Asahi
Mercedes-Benz Japan Award Thacher & Bartlett; Sullivan & Cromwell; Weil Gotshal & Manges Banks: Daiwa Securities; Goldman Sachs; Mitsui Sumitomo Why: • JPY400bn (US$4.6bn) bid succeeded as Sanyo’s top three shareholders – Goldman Sachs, Daiwa Securities and Sumitomo Mitsui Banking Corporation – agreed to sell portions of their shareholdings into the tender offer • subject to careful anti-trust review in various jurisdictions such as the US, EU, Japan and China, where the transaction was cleared conditional upon certain remedies • conducted by way of public tender offer targeting not only listed common shares but also unlisted preferred shares; very uncommon, hence involved certain complex legal issues
The American Chamber of Commerce in Japan Award
International Dealmaker of the Year • Ted Paradise, Davis Polk & Wardwell • Dale Caldwell, Morrison & Foerster • Yoichi Katayama, Orrick • Tong Yu, Paul, Weiss • David Sneider, Simpson Thacher & Bartlett • Izumi Akai, Sullivan & Cromwell
Japanese Dealmaker of the Year • Akiko Kimura, Anderson Mori & Tomotsune • Toru Ishiguro, Mori Hamada & Matsumoto • Fumihide Sugimoto, Nagashima Ohno & Tsunematsu
Japanese Deal Team of the Year • Anderson Mori & Tomotsune Capital Markets Team • Mori Hamada & Matsumoto Capital Markets Team • Mori Hamada & Matsumoto M&A Team • Nagashima Ohno & Tsunematsu Capital Markets Team • Nishimura & Asahi M&A Team
Zensho Award
International Deal Firm of the Year FINALISTS • Davis Polk & Wardwell • Linklaters Tokyo • Paul, Weiss • Simpson Thacher & Bartlett • Sullivan & Cromwell
Japanese Deal Firm of the Year FINALISTS • Anderson Mori & Tomotsune • Mori Hamada & Matsumoto • Nagashima Ohno & Tsunematsu • Nishimura & Asahi
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Insolvency Law Firm of the Year
International Investment Bank In-House Team of the Year
IP Law Firm of the Year
FINALISTS
FINALISTS
• Deutsche Bank • Morgan Stanley • UBS
• Anderson Mori & Tomotsune • Lovells • Momo-o, Matsuo & Namba • Mori Hamada & Matsumoto • Morrison & Foerster • Nakamura & Partners • TMI
TMT In-House Team of the Year
Offshore Law Firm of the Year
FINALISTS • Hitachi • IBM • NTT DoCoMo • Sanyo Electric Corporation
the japan in-house counsel network award
Trading company In-House Team of the Year
FINALISTS • Appleby • Conyers Dill & Pearman • Maples and Calder • Ogier • Walkers
Osaka Law Firm of the Year
FINALISTS
FINALISTS
• Itochu • Mitsui • Sumitomo Corporation
• H Okada • Oh-Ebashi
Japan In-House Lawyer of the Year • Masako Takahata, Deutsche Bank • Philip Quirk, Morgan Stanley • David Monroe, Nikko Asset Management • Edward Gilbert,Shinsei Bank • Aaron Eddington, UBS
Japan In-House Team of the Year
Lifetime Achievement Award • WINNER ANNOUNCED ON THE NIGHT
JAPAN DEAL OF THE YEAR • FINALISTS ANNOUNCED ON THE NIGHT
FINALISTS ANNOUNCED ON THE NIGHT
SPONSORS Zensho
Mercedes-Benz Mercedes-Benz Japan was established in 1986 as an integral part of the worldwide group of Daimler, and has been a pioneer since the dawn of automotive history, and a global leader in the industry. For nearly a quarter century, Mercedes-Benz Japan has contributed to the growth of the Japanese automotive industry and its market through our comprehensive business activities that have focused ultimately on customer satisfaction. Contact details T: 0120-009927 (Toll Free from Japan) Email: direct_sales.pool-id@daimler.com
As legal profession recruitment specialists, Zensho is proud to sponsor this year’s award for International Deal Firm of the Year. Specialist recruitment within the legal profession requires local market specialization, long-term commitment, personal attention, discretion, initiative and a sincere intention to help. Our success depends upon our consistent ability to quickly make connections, produce results and maintain strong, lasting relationships within the legal and business community. We hope our continued efforts to be a trusted advisor and provider of accurate and timely information will make us the market’s provider of choice. Contact details T: +81-3-5575-5091 Email: enquiry@zenshogroup.com
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Feature | Australian firms in Asia >>
Australians in Asia niche play to the north Asia has been a top priority for Australia’s best law firms for the past decade, but 2010 is seeing new expansion. Blake Dawson has just set up in Tokyo, Clayton Utz is opening in Hong Kong, and Minter Ellison is eyeing Beijing. ALB talks to Australia’s top law firms about new openings and their strategy for the region. By Alice Yan
E
ver since moving into Asia in the 1980s, Australian law firms have pursued aggressive growth strategies in the region. This year, however, things are really heating up, with three new office openings scheduled for 2010. And it is now common market conjecture that the underlying motivation behind the recent move into Australia by some UK firms was really targeted at Asia. These new developments are undoubtedly an extension of law firms’ long-term growth strategies for the Asia-Pacific region. Yet their similar timing is not mere coincidence; it reflects a common optimism towards post-GFC Asia.
Asia in 2010 While the Asian region has always been rich in opportunity, post-GFC Asia offers some ‘once-in-a-global economic cycle’ opportunities. “The financial crisis has shifted the balance of East and West as far as the global economy goes,” says Allens Arthur Robinson’s head of greater China M&A, Campbell Davidson. He says that the GFC has accelerated, in particular, China’s political and economic ascendancy. “It has rushed China into a role we may have expected from it 20-30 years down the track. This creates enormous opportunities to provide the corresponding legal infrastructure to keep up to pace with these accelerated financial leaps.” Asia’s relative immunity to the global slump has increased its respective economic and political importance.
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Clayton Utz’s managing partner for litigation, Stuart Clark, says India also weathered the financial crisis well and foresees enormous project investment opportunities from the country, both internally and offshore. Australian lawyers in Asia forecast a promising 2010 ahead in Asia. “There was a small hiccup in investment, but Asia came out of the GFC not burdened by the same level of debt as the rest of the world,” Clark says. “Once the shackles of the GFC are shaken off and investors realise the prospect of a ‘double dip’ is unlikely, development and infrastructure projects and construction work will really pick up, with a spill over into dispute resolution. There is a clear way forward with Stuart Clark Clayton Utz real opportunities.” Australian law firms expect to capitalise on the growing Asian market, predicting a greater share of its outbound flows going into this home country. “Australia is now the 10th largest economy in the world,” Blake Dawson partner Ian Williams says. “Our domestic market has become an attractive home for investment in its own right.” He says energy & resources will remain a natural focus for Asiaoutbound investment into Australia, but he also foresees investment opportunities in non-traditional areas arising there. “We’re seeing a lot more interest from Asia in areas like foodstuffs, consumer products and financial services, in particular
securities law,” he says. Blake Dawson tax partner Duncan Baxter says that Australia’s economy came out of the global downturn viewed as a more attractive Ian Williams home for investment Blake Dawson capital, especially for more cautious investors in Asia. In particular, outbound investment from China that previously went to the US may now be redirected to Australia. “Our clients in Asia are moving away from the traditional model of appointing distributors and instead taking market shares in leading Australia companies. This creates M&A work,” Williams says.
New offices Leading Australian firms are strikingly different in their motives for opening, their locations across Asia and their practice focuses. While Australian law firms struggle for distinction in their saturated home market, the strategic approaches and targets each has adopted in the broader Asian marketplace for legal services are fairly unique. Clayton Utz opened its first office in Asia this April, with the move onshore
►► breakdown of asia-focused revenues 15 12 9 6 3 0
10% Blake Dawson’s revenue made up over 10% of overall revenue, growing by around 25% a year
15% Contribution of Mallesons Stephen Jaques’ Asia practices to overall firm revenue
Asian Legal Business ISSUE 10.5
Feature | Australian firms in Asia >>
departing from the ‘fly-in-fly out’ model it had faithfully defended for the past two decades while its major competitors were setting up offices across Asia. But the big question is why go onshore now? Clark says that opening a physical office formalises the position that the firm has already had for a long time – serving top-quality premium clients with a strong fly-in-fly-out team for years, and with an established reputation in the region. “We’ve been waiting for the right opportunity to
to Mallesons, but says it is with a very different intention. “We are not hoping to set up a full-service office in Hong Kong,” Clark says. “We aim to play to our strengths and concentrates on those areas.” Clayton Utz’s Hong Kong office will focus on the firms’ two core strengths – construction and major projects – and dispute resolution and arbitration, though he says expansion into other areas hasn’t been ruled out.
“The financial crisis has shifted the balance of East and West as far as the global economy goes” take the next step,” Clark says. Clayton Utz has formed a local alliance with Haley & Co, to be headed up by founder Glenn Haley. He has had longstanding ties with Clayton Utz and the firm’s partner Colin Dodd, who has been based in Hong Kong for a number of years. “This was a unique opportunity in Hong Kong where we already have pre-existing work and partners with credibility, reputation and profile,” Clark says. Clayton Utz’s move resembles how Mallesons Stephen Jaques first entered the Asian market fully years before Mallesons, by setting up a base in Hong Kong in alliance with Denton Hall and Burgin. Clark acknowledges that the firm has adopted a similar approach
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Campbell Davidson
Allens Arthur Robinson
“There’s little doubt Clayton Utz has the strongest dispute resolution team in Australia. We’ve also accumulated substantial experience in project work
in the region, including water projects in Indonesia and wind farms and power stations across Asia.” Blake Dawson has also been on the move, but with different targets in sight. Shortly after opening in Singapore in 2009, the firm opened another new office in Tokyo this April, earning the distinction of being the first Australian law firm to set up a base in Japan. Williams says the Tokyo opening was an extension of its long-term strategic focus in Japan. “We decided to make Japan a growth priority 15 years ago, and the firm now has the largest – and leading – Japanese practice in Australia.” He says that currently, a large percentage (about 5%) of the firm’s overall client base in Australia, Port Moresby and Jakarta are Japanese, so opening in Tokyo cements the firm’s relationship-based strategy for Asia. “We want to be located where our
►► Strategies of on-shore firms The four firms that moved onshore into Asia first have very different strategic focuses in the region: Firm
Mallesons Stephen Jaques
Allens Arthur Robinson
Blake Dawson
Minter Ellison
Strategy
Mallesons Stephen Jaques clearly has the biggest Asia footprint, but demonstrates a North Asia bias, serviced largely by its Hong Kong office where its critical mass in Asia is based
Allens Arthur Robinson has the broadest reach across Asia, with an unparalleled number of offices scattered throughout the region. It is also more active in the mainland, being the first Australian firm in China to establish three offices and the first firm licensed to work on IP matters
Blake Dawson’s offices follow the flows of capital, putting a long-term strategic focus on Japan, Singapore and China. The firm has made a strategic decision not to target Hong Kong, seeing it as a place where money flows through. “We are interested in being where the assets are,” Blake Dawson partner Michael Wadley says
Minter Ellison’s China office serves as an effective marketing tool. The Shanghai base is a small representative office on the ground, which acts as ‘eyes and ears’ by building contacts and bringing work home
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Feature | Australian firms in Asia >>
►► Targeting Asia using an Australian base The defection of 16 Australian partners from a major firm to a UK entrant stirred a scandal in the Australia market that distracts from the real target. It is popular market sentiment that Allen & Overy’s entrance onto Australian soil was not motivated by the small – and already saturated – domestic market, but rather is a clever ploy to increase market share and presence in Asia by leveraging off an Australian base. So far the Asian practices of Australian firms have enjoyed natural advantages over their UK competitors, simply by being ‘Australian’. John Curtis, a partner with Freehills explains that Australian firms are the natural choice for Asian- outbound work into Australia. This is a substantial amount when you consider that Chinese investment into Australia alone amounts to $90 billion. Australian firms are also the top pick for work within Asia, have unparalleled regional expertise in the region. But local expertise and reputation are attributed as much to the Australian firm brand as to their top people. So when the UK firms start pinching their best talent, they are eroding the local firms’ main competitive edge. Yet most Australian top-tiers continue to shrug away the threat with determined nonchalance. Mallesons Stephen Jaques partner Robert Milliner says that “Magic Circle isn’t a magic bullet in this part of the world”. And Stuart Clark from Clayton Utz says the idea that Allen &7 Overy will service its Asian needs with newly-acquired Australian resources is not a viable model. “Australia is still a nine-hour flight away from most of Asia,” he says. Ian Williams from Blake Dawson claims that any UK set-ups in Australia do not, by a long way, have the spread and depth of expertise in the region that the leading Australian firms have. No doubt, they do not have this just yet. Williams acknowledges that “the UK entrant into the Australian market is a fundamental inflection, [a] point of change. It marks the shift in the Australian legal market from a domestic legal market to an international legal market in the next two-three years.” Consequently, Australian firms may have to extend and move beyond their natural competitive advantages to effectively differentiate themselves in Asia.
clients are. We already have five partners living and working in Japan. Opening this office was the logical next step,” he says. Similarly, Blake Dawson opened its Singapore office last year to follow the flow of capital. “The regional headquarters of multinational corporations and the investment division of our major clients are based
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“When you get to a certain point, an office on the ground can do things you need that a fly-in-fly-out model cannot” in Singapore,” Williams says. “A lot of the investment into India also goes via Singapore.” He says the firm would be looking at Korea as the next logical market for opening an office after liberalisation allows it, but Minter Ellison, on the other hand, is awaiting approval to open a new office in Beijing.
Onshore versus offshore Clayton Utz was the last top-tier firm to defect from the offshore model. Its decision to open onshore confirms the consensus reached amongst the top Australian firms over time that there are unparalleled advantages of being onshore. The most obvious one is presence. “Being able to give real-time advice on the ground when it is needed is a real attraction to our clients,” says Minter Ellison’s international Mark Green Minter Ellison managing partner Mark Green. As business in China is relationship-driven, having an onshore presence also means better client building opportunities and marketing. Bonds will surely form faster with someone over hotpot than from four thousand miles away! Allens Arthur Robinson’s Davidson says relationships take a long time to develop and requires lawyers to be on the ground, mixing with locals. “You need a significant team of PRC lawyers, born and bred and educated in the PRC, with their own contacts and friends working in local firms and government,” Davidson says. Williams says Blake Dawson’s physical presence sends a signal to local lawyers. “It shows we have a real commitment to serving their market,” he says. Yet Corrs Chambers Westgarth’s Sydney partner Anthony Latimer says that physical presence makes little difference, as long as Australian-based staff Anthony Latimer can make themselves Corrs Chambers Westgarth available and be mobile.
Stuart Clark
Clayton Utz
“Not being across the road means we cannot be at their office in half an hour, but we can hop on a flight and be there in eight hours,” he explains. Corrs is one remaining firm without an Asian office, preferring to use six partners across its Melbourne, Sydney, Perth and Brisbane offices dedicated to China-related work. Latimer says the firm manages client relationships on par with onshore firms, using a combination of modern technology, strong language skills in Australia and senior partners who have spent most of their lives in China. But Minter Ellison’s Green insists that this is no substitute for personal interaction. “When you are in the same room, you can read body language across the table that you can never get from a telephone conversation over a screen,” he says. Even Clayton Utz succumbed to the need for opening an Asian office, just waiting for the right opportunity. “When you get to a certain point, an office on the ground can do things you need that a fly-in-fly-out model cannot,” says Clark. Those firms which remain offshore in the region continue to claim they are not at any disadvantage, but closer examination of the circumstances show they’ve not moved onshore because they lacked the capacity to – or acted too late. Most Australian mid-tier firms like Corrs Chambers Westgarth will fall into the first category, but Freehills is in the second. The firm was late jumping onto the Asia bandwagon, and decided in 2004 to fast-track its cultural learning curve by forming an alliance with local law firm TransAsia in Singapore. As Australia plays more of a role in the international market its law firms will increasingly struggle with the fundamental operating decision about how ‘international’ they want to (and can afford to) become. “They must choose between staying a purely domestic business or regional business. Going regional requires significant investment financially and in HR and management,” Williams says. “Only the committed will go ahead.” ALB Asian Legal Business ISSUE 10.5
Feature | Australian firms in Asia >>
www.legalbusinessonline.com
53
Feature | Islamic finance >>
ALB’s Leading Islamic finance law firms: Asia Law firms are moving to new and emerging markets to not only target, but be part of, the unstoppable growth of Islamic finance structures. By Rashida Yosufzai
S
ince modern-day Islamic finance emerged as a model in the Middle East in the 1970s, its expansion has been rapid. The IMF estimates that Islamic finance assets have grown by 10% every year in the last decade. That growth – making Islamic finance one of the fastest-growing sectors of the global financial market – has been achieved in a relatively short time. Yet it’s that very pace of growth which has the legal world worried. In December 2009, when UAE property firm Nakheel faced defaulting on repayment of its sukuk (Islamic
bonds), worldwide headlines claimed that the market would shun Islamic finance as a banking system. For many observers, and not only in the legal world, it seemed that the growth story might end. But lawyers on the frontline argue that far from Islamic finance coming to an end, it’s really at the very beginning. In keeping with the market, this model carves out a potentially lucrative practice area. Now, and for those venturing into markets traditionally perceived as non-Islamic (in the EU and North Asia), to the surprise of many it is currently growing.
HEADLINE Islamic Finance DEALS – WORLDWIDE: Maxis Berhad IPO US$3.3bn Firm: Linklaters Client: Underwriters Firm: Clifford Chance Client: Maxis Berhad Lead lawyer: Crawford Brickley Firm: Adnan, Sundra & Low Client: Underwriters Firm: Zul Rafique Client: Maxis Communication Berhad
Firm: Kadir Andri & Partners Client: Maxis Berhad Lead lawyers: Samuel Hong, E. Sreesanthan • Malaysia’s biggest mobile phone company, Maxis Berhad, in US$3.3bn IPO on the Bursa Malaysia • Largest Malaysia IPO and Asia in 2009 • Biggest telco public offering seen in Asia-Pacific since 2000
Kuwait Energy Company Shariah financing US$50m Firm: Fulbright & Jaworski Lead lawyers: Andrew Hart, Michael McMillen, David Moroney Client: IFC Firm: Lovells Lead lawyers: Matthew Andrews, Rustum Shah Client: Kuwait Energy Company • Kuwait Energy Company
november 2009 >> 54
MALAYSIA
NOVEMBER 2009 >>
loaned US$50m Shariahcompliant financing from International Finance Corporation towards oil and gas assets exploration • First financing provided by IFC Kuwaiti oil and gas company, represents the dedication of all parties involved to ensure that commercial requirements of this unique class of financing was compatible with the Shariah • Lovells/Fulbright cross-border London/Dubai offices advised on English law and Shariah structuring kuwait
Asian Legal Business ISSUE 10.5
Feature | Islamic finance >>
Islamic finance’s continued ascendancy T
he GFC presented a unique opportunity for “unconventional” banking methods to shine and, by principle, Islamic finance is the very embodiment of unconventional. The model shuns financial risk and interest, and requires tangible assets to back up transactions. Due to this, some argued that the global economy would not have suffered as much had Islamic finance been used instead of conventional banking: it had, in effect, a moral upper hand. In 2007, the total value of sukuk issuances peaked at almost US$35bn. “During the global financial crisis, a number of conventional banks closed down – but at the same time new Islamic banks were opening up all over the world,” says Madzlan Hussain, partner and head of Islamic finance at Malaysian law firm Zaid Ibrahim & Co. However, Islamic finance institutions
GE Capital sukuk US$500m Firm: Conyers Dill & Pearman Lead lawyer: David Cooke Client: GE Capital Firm: Allen & Overy Lead lawyer: Anzal Mohammed Client: GE Capital
(IFIs) were not entirely unexposed to the crisis. Besides Nakheel, three other IFIs restructured debts or had defaulted on their sukuk repayment, starting off with East Cameron Gas (Oct 2008), Investment Dar (May 2009), and Saad Group (June 2009). If sentiment was still soaring then it was firmly grounded by December 2009. The announcement by the conglomerate Dubai World that it would halt repayment of its subsidiary Nakheel’s Islamic bonds, which were due in a matter of weeks, stunned the global market. Because one of Islamic finance’s pillars is for investors to share the issuer’s risk, as opposed to the conventional system of risk-taking, many considered that Islamic finance had limited scope to grow. This presented Islamic finance groups in law firms with a major problem: not only did Nakheel cast a
Firm: Clifford Chance Client: Citi/Goldman Sachs • GE Capital’s offering of sukuk certificates to diversify alternative funding sources • First such offering issued by major US company and first of its type to be used to finance aircraft leasing
www.legalbusinessonline.com
uae
►► MALAYSIA:
• Abdul Rahman & Partners • Adnan, Sundra & Low • Albar & Partners • Azmi & Associates • Hisham Sobri & Kadir • Kadir Andri & Partners • Lee Hishammuddin Allen & Gledhill •Mohamed Rizda & Co • Rajah Darryl & Loh • Shahrizat Rashid & Lee • Shearn Delamore & Co. • Zaid Ibrahim & Co • Zul Rafique & partners
►► INDONESIA:
• Assegaf, Hamzah & Partners • Hadiputranto, Hadinoto & Partners • Hannafiah Ponggawa & Patners • MMIK Law Office • Soebagjo, Jatim & Djarot
►► SINGAPORE:
• Allen & Gledhill • Arfat Selvam Alliance
►► International Law firms- Asia
• Allen & Overy • Clifford Chance • Lovells • Norton Rose
►► Methodology
ALB conducted the extensive research with numerous in-house legal counsels, banking & financial services professionals, industry specialists and private practice lawyers for the last 3 months. Our respondents were asked to nominate Asia’s leading Islamic Finance law firms and lawyers based on their industry reputation and quality of work. Submissions made as part of the ALB Law Awards series were also considered. The Middle East region was excluded from this survey.
Safeena Shariah • Unique Islamic finance • Azmi & Associates shipping investment investment deal for Malaysia’s retained through Ince & Firm: Ince & Co Lead lawyer: Martin Brown Client: Safeena Firm: Azmi & Associates Lead lawyer: Ahmad Lutfi Abdull Mutalip Client: Safeena Firm: MKK Lead lawyer: Craig Heggie Client: Safeena
DECEMBER 2009 >>
ALB’s leading Islamic finance law firms: Asia
MARCH 2010 >>
only Islamic shipping fund, deal structured through deferred purchase and forward lease arrangement • First purchase and forward lease structure (also called an istisna’a-ijarah structure) used by shipping fund • Ince & Co approached by Safeena due to Brown’s prior experience on conventional and Islamic financing deals-
Co, advising on legality/ enforceability of legal documentation and fund structure to meet local law requirements
MALAYSIA
55
Feature | Islamic finance >>
negative light on the growth of Islamic finance, but some looked towards the lawyers’ roles in structuring the Shariah documents. The Nakheel sukuk default was viewed as contributing to weaker investor confidence in Islamic finance, says Oliver Agha, the cofounder of Shariahcompliant law firm Agha & Shamsi. “Certainly, public confidence in a Oliver Agha, system is undermined Agha & Shamsi when widespread defaults suggest a systemic fault, as was the case with the conventional
banking crisis,” he said. But Asiabased Islamic finance lawyers remain confident there will be no fallout from the affair. “Despite the Nakheel event, the interest in Islamic finance is still growing,” says the head of Malaysian firm Azmi & Associates’ Islamic finance practice, Ahmad Lutfi Abdull Mutalip. “The problem was not really because of Islamic finance but because of the credit risk of the issuer, which can occur in any sort of banking method – Islamic or conventional.” So what kind of market do Islamic finance lawyers face now – uncertainty or optimism? “It’s safe to say there’s huge potential for growth in Islamic
finance because it reached the [IMF’s estimated] 10% growth rate in such a short space of time,” says Hussain.
“Certainly, public confidence in a system is undermined when widespread defaults suggest a systemic fault, as was the case with the conventional banking crisis.” Oliver Agha
Agha & Shamsi
IF: not just for the Middle East Old world versus new
M
alaysia and the Middle East have always dominated the global Islamic finance market as a solid source of work for many law firms. Malaysian government investment over the years has created a stable base of clients for law firms – it was on the encouragement of the Malaysian central bank that Asia’s largest lowcost airline, AirAsia, embraced Islamic finance, not only for an aircraft leasing transaction but for a sukuk issue. “We embraced Islamic finance, not only because it was economically feasible but because there was a drive in the last few years to make Kuala Lumpur an Islamic finance hub,” says AirAsia senior counsel, Amir Fazael Zakaria. Last year, the airline won industry plaudits for its US$336m innovative Islamic French-Malaysian lease used to finance eight new aircraft. The year before, the company issued US$158.5m in sukuk to finance its capital expenditures. “There were some hoops and hurdles we had to jump through to make [the 2009 lease] Shariah compliant but the basic structure is still a lease,” explains Zakaria, adding the company’s future embrace of Islamic finance will depend on whether the government will continue to invest in the sector. “Islamic finance will always be an option that AirAsia will be open to, given the right circumstances, if 56
the cost of funding is still competitive, and the government is still providing incentives. We’ve been noted as an entity that actively partakes in Islamic finance in the region and we’re proud of that.” Law firms are continuing to invest in the Middle East region on the back of regional growth in Islamic finance. In January King & Spalding promoted Islamic finance specialist Jawad Ali
to regional managing partner. In February, Denton Wilde Sapte said it wanted to target the Islamic finance market in Bahrain, and launched a local office through an alliance with Hassan Radhi & Associates. The firm had sound rationale for the move – Bahrain is positioning itself as the area’s Islamic finance hub. According to the Governor of its central bank, Bahrain has one of the largest numbers
“Indonesia is a country with a population of almost 300 million and is also untapped for Islamic finance. It is practically unknown there”
Amir Fazael Zakaria
AirAsia Senior Counsel
Asian Legal Business ISSUE 10.5
Feature | Islamic finance >>
of IFIs in the world, providing a solid client base. Hussain says that Malaysia has done a lot of the groundwork that other jurisdictions can replicate without going through the same painstaking experiments. “It will continue to be a leading jurisdiction for Islamic finance, but at the same time you cannot undermine the potential for others to also compete very well in offering the best platform for Islamic finance to take off.” Although Malaysia and the Middle East will continue to dominate much of the market, some hiccups have been felt in both regions. For example, Malaysia’s latest investment proposal, allowing up to five foreign law firms to practice local law (but only on Islamic finance transactions) didn’t exactly receive the same kind of enthusiasm as Singapore’s 2009 license grants. “For many full-service [foreign firms] the value proposition would not be too enticing because they can service Islamic finance from their headquarters anyway,” explains Hussain. “I believe the central bank is looking to revise the proposal because of the [feedback from] international firms – that it’s not a valuable enough proposal to set up in Malaysia –and maybe to allow perhaps a larger practice base.” In the Middle East, law firms looking for work may also be cautious as not all countries have embraced Islamic finance. In Oman, for example, lawyers note there is no Islamic finance industry, let alone work, there. “There is a general perception that Oman does not favour the establishment of Islamic finance institutions. In any event the transaction costs, for example, of real estate sale and leasebacks can be very high,” explains lawyer Taimur Malik, of Muscat-based law firm SALSO. “There is a sector of the private and business community which has an appetite for Shariah-compliant financing or products and there may be a market, but it’s subject to a change in government policy and with real costs to be competitive with conventional financing structures.” In a similar fashion to Zaid Ibrahim, US firm Crowell & Moring made its Middle East debut in April, opening an affiliate office in Egypt by partnering with Cairo-based Hegazy & Associates. www.legalbusinessonline.com
The firm’s motivation was also the rising market for Islamic finance, yet it faces a similar hurdle as others because Islamic finance is still underdeveloped in Egypt. Like in Oman, the government has yet to embrace Islamic finance. Nevertheless, one of the main types of work for Islamic finance practices, sukuk issuance, is growing on the basis of IFIs tapping into new markets. A recent Standard & Poor’s report says “sukuk is attracting issuers from an increasing number of countries and this trend is set to continue. Issuers from more than 20 countries have expressed interest in issuing, or announced their intention to issue, sukuk.” New and emerging markets for Islamic finance – in short, where the work is likely to move – is one of the most pressing issues for law firms worldwide. In a list of ‘“up and coming jurisdictions’, lawyers throw a number of interesting locations into the mix – London, Australia, France, Germany, Malta, the Channel Islands, Japan, Hong Kong, Korea. And the list goes on.
New horizons AirAsia’s Zakaria says that there is a good reason why Malaysia has positioned itself to be the world’s Islamic finance hub – its strategic location within such a large investor base. “Indonesia is a country with a population of almost 300 million, and is also untapped for Islamic finance. It is practically unknown there,” he says. “It’s not just in terms of the aviation industry but for consumer banking. It’s why Malaysia continues to place itself as a hub. We have a head-start since we started taking baby steps almost three decades ago.” Such is Hussain’s faith in the growth of Islamic finance that his firm took a huge investment risk last year to target a virtually absent Islamic finance market in Australia. Zaid Ibrahim partners said they saw local interest while accompanying a trade delegation from Malaysia’s central bank to promote Islamic finance in Australia, so last year it became the first Asian law firm with an Australian operating licence. Partner Lim Kar Han, who will head the Australia practice, admits that while the market in Australia is still in its infancy the firm will be part
►► Top 10 global Islamic bond issuer rankings - 2010 Q1 Pos.
Issuer
Deal value (US$m)
No
%share
1
Danga Capital Bhd
612
1
34.7
2
Dar Al-Arkan Real Estate Development Co
446
1
25.3
3
Khazanah Nasional Bhd
228
1
12.9
4
Saudi Hollandi Bank
193
1
11.0
5
Gamuda Bhd
97
1
5.5
6
Cagamas Bhd
94
1
5.3
7
PT Perusahaan Listrik Negara-PLN
32
1
1.8
8
Sunrise Bhd
29
1
1.7
9
Tradewinds Corp Bhd
15
1
0.9
10
Aeon Co Ltd
1
0.5
9
Source: Dealogic
of the process, helping it grow through education. “It’s a nascent industry which is growing, but there still has to be an education process. The next step for us is a roadshow where we’ll be looking at case studies and how you can bring [products] to the market.” Yet there are only a handful of Australian banks that have shown interest in Islamic finance. A local banker who managed the roll-out of a product for one prominent bank could not comment on the potential for future growth in Australia. Regardless, the Australian government has put considerable thought into using Islamic finance to make the country an Asian financial hub, on the basis that Australia has a larger Muslim population than for example, Hong Kong or Japan. Lim says that Zaid Ibrahim is already working closely with two Australian law firms. “We are working on some [Islamic finance] products at the moment to develop together with the firms,” he said. “It’s very much a collaborative process and we just want to build on those good relationships.” So what else can the firm expect for Islamic finance in Australia? “There are a whole range of Islamic finance products you can tap in Australia, but the best is to [target] the lower hanging fruits first,” says head of Islamic finance Hussain. “There is scope both at the commercial, retail and wholesale funding levels; because the Australian banking industry taps quite significantly into international funding.”
57
Feature | Islamic finance >>
IF lawyers – important future role
I
slamic finance lawyers will face some significant challenges in the next few years, and will play a huge role developing modern legal structures for Shariah-compliant transactions and innovative Islamic finance transactions. “Recent issues opened the eyes of Islamic finance bankers and teams who look to structure deals better so that those kinds of problems can be eliminated in future sukuk issues,” says Azmi & Associates’ Mutalip. “Lawyers [can] now ensure they’re brought in from day one ... so that in the event of a default the transaction structure is foolproof.”
“Since Islamic finance is a global phenomenon, the basic set of corporate laws in each country should at least be ‘talking to each other’, as documents will be applied individually where the contract belongs” What Nakheel and other troubled IFIs did was not only bring Islamic finance into the consciousness of the mainstream market but helped shine a light on some of the difficulties lawyers have faced over the years. It’s not just problems with reconciling different interpretations of Shariah law in each country but how to reconcile Islamic finance product structures within western legal regimes. The Nakheel default, for example, pushed Dubai into developing better bankruptcy laws. In short, Islamic finance’s problems can also create new opportunities and business for lawyers too. Harris Irfan, head of Islamic products at Barclays Capital, says that the role of lawyers is more important now. “Inhouse legal departments are taking their time on Shariah representation and carefully looking at the language of the contract, so no one can say it’s null and void,” Irfan told Reuters in March. “The process already takes time and we’re making it even slower. It’s a shame but this is going to make the industry grow at a slower pace.” But not all in-house lawyers share the same view. Zakaria says there’s only so much that they have control over. “In-house lawyers really don’t play that
58
Ahmad Lutfi Abdull Mutalip
Azmi & Associates
much of an active role in the product structuring. Because of the way Islamic finance structures are devised we see the financing once we have [the] term sheet in front of us. It’s not something that we can proactively say ‘let’s look out for these dangers’. Besides, in Asia there is a lot of faith in regional IFIs who have well-established Shariah boards. We don’t see any issues to be worried about on their credibility,” he explains. Another huge source of work for lawyers will be in reconciling Shariah interpretations in various countries. “Since Islamic finance is a global phenomenon, the basic set of corporate laws in each country should at least be ‘talking to each other’, as documents will be applied individually where the contract belongs,” says Mutalip. Oliver Agha says that ensuring IF transactions abide by Shariah and not conventional risk profiles will “generate much work for law firms”. “We’re witnessing many structures that were hurriedly put together with Shariah approvals that have hit serious legal enforceability issues,” he says. “A Shariah approval does not render a transaction enforceable but merely declares the scholar’s view as
to its perceived compliance. There is a significant amount of work involved in sorting through issues where the approval deviates from consensus or results in a structure that has deficiencies under the law of the jurisdiction at question. As more and more such structures come to light, the work for lawyers with comprehensive Shariah knowledge and skills will continue to increase.” Reconciling Shariah principles – perhaps through a global code of practice – is certainly idealistic, and Hussain says it won’t be easy. “Streamlining Shariah interpretations will not be the best way forward, especially since Islamic finance is still in its infancy,” he says. “Innovation and paradigm shifts will need to take place within Shariah law itself, so I don’t think there will be any uniformity taking place in the near future.” What’s more, says Hussain, it doesn’t matter whether reform happens or not. “There is an opportunity for law reform to happen but the growth of the industry will not be dependant on it,” he says. “The industry will still move forward because new jurisdictions are very much well positioned to accommodate the growth.” What is certain among lawyers and bankers is that Islamic finance is attracting more attention. Lim says the reason why traditionally non-Islamic nations have embraced the model is that IF is becoming an important part of [the] international finance world. It will compliment and compete with conventional finance, no longer taking a back seat.” he says. ALB Asian Legal Business ISSUE 10.5
To participate in this prestigious event contact: sophie@megaevents.net | t:+971 4 343 1200 | f:+971 4 343 6003 P.O. Box 72045, Dubai | www.megaevents.net/islamic_banking
Feature | Islamic finance >>
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Seeking New Growth Horizons WIBC 2010: Asian Summit Keynote Speaker
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59
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Lim ite d
In ho at use te c nd ou fo ns r e
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MARKETdata DATA| M&A | M&A market >>>>
In association with
M&A TRANSACTIONS AND STATISTICAL ANALYSIS Top 10 Announced Deals - Asia-Pacific (Apr 01, 2010 - Apr 23, 2010) Announcement Date
Target Company
Target/Seller Legal Advisor
Bidder Company
Bidder Legal Advisor
12-Apr-10
Syncrude Canada Limited (9.03% stake)
Advising seller: Osler, Hoskin & Harcourt
China Petroleum & Chemical Corporation
Blake, Cassels & Graydon
7-Apr-10
Daimler AG (3.1% stake)
Freshfields Bruckhaus Deringer
Nissan Motor Company Limited; and Renault SA
Nishimura & Asahi; Sullivan & Cromwell
1-Apr-10
Tong Yang Cement Company Limited (59.2% stake)
16-Apr-10
NAU Country Insurance Company
16-Apr-10
Seller Company
Deal Value (USDm)
ConocoPhillips Company
4,650
1,558
Golden Oil Corporation
Tong Yang Major Corporation
741
QBE Insurance Group Limited
Lightyear Capital LLC
565
345-MW San Roque Multipurpose Hydroelectric Power Project
San Miguel Corporation
Power Sector Assets & Liabilities Management Corporation
450
6-Apr-10
Jushi Group Company Limited (49% stake)
China Fiberglass Company Limited
China National Building Material Company Limited; Hony Capital; Surest Finance Limited; and ZhenShi Holding Group Company Limited
430
18-Apr-10
Sul Americana de Metais S.A
Honbridge Holdings Limited
Votorantim Novos Negocios Ltda
390
9-Apr-10
Atlas Energy Resources (Marcellus Shale) (40% stake)
6-apr-10
15-Apr-10
Notes:
Advising seller: Sullivan & Cromwell
Advising seller: Jones Day; Ledgewood Law Firm; Wachtell, Lipton, Rosen & Katz
King & Wood
Reliance Industries Limited
Vinson & Elkins
Atlas Energy Inc
339
HNA Airport Holding (Group) Company Limited (54.5% stake)
Hainan Meilan International Airport Company Limited
Grandall Legal Group
HNA Group Company Limited; Kingward Investment Limited
322
PT Carrefour Indonesia (40% stake)
PT Trans Corpora
Carrefour SA
300
Top deals table includes lapsed and withdrawn bids, and is based on geography of either target, bidder or seller company being Asia-Pacific•Quarterly trend graph excludes lapsed and withdrawn bids, and is based on dominant geography of target only being Asia-Pacific•League tables are based on geography of either target, bidder or seller company being Asia-Pacific. League tables of legal advisors include lapsed and withdrawn bids, while league tables of financial advisors exclude lapsed and withdrawn bids. League tables are ranked by value • Statistics includes all deals valued over USD 5m. Where deal value not disclosed, deal has been entered based on turnover of target exceeding USD 10m•Activities excluded from statistics include property transactions and restructurings where the ultimate shareholders’ interests are not changed.
League Table of Legal Advisors to Asia-Pacific (ex-Japan) M&A (Jan 01, 2010 - Apr 23, 2010) Rank
House
League Table of Financial Advisors to Asia-Pacific (ex-Japan) M&A (Jan 01, 2010 - Apr 23, 2010)
Value (USDm)
Deal Count
Rank
Value (USDm)
Deal Count
1
Herbert Smith/Gleiss Lutz/Stibbe
48,657
3
1
Deutsche Bank
53,846
11
2
Slaughter and May
38,683
4
2
Goldman Sachs
49,160
14
3
Sullivan & Cromwell
36,077
4
3
HSBC
46,628
4
4
Cleary Gottlieb Steen & Hamilton
35,950
3
4
Citigroup
43,282
11
5
Norton Rose
35,896
9
5
Credit Suisse
42,289
8
6
Simpson Thacher & Bartlett
35,824
4
6
Morgan Stanley
36,831
11
7=
Cravath Swaine & Moore
35,500
1
7=
Blackstone
35,500
1
7=
Debevoise & Plimpton
35,500
1
7=
JPMorgan Cazenove
35,500
1
7=
Weil Gotshal & Manges
35,500
1
7=
Lazard
35,500
1
10
Davis Polk & Wardwell
29,211
5
10
UBS Investment Bank
23,760
15
Based on announced deals, including lapsed and withdrawn bids, from 1 January 2010 to 23 April 2010
House
Based on announced deals, excluding lapsed and withdrawn bids, from 1 January 2010 to 23 April 2010
Asia-Pacific M&A Activity - Quarterly Trends 900
200,000 180,000
800
Value (USDm) Volume
140,000
700 600
120,000
500
100,000
400
80,000
300
60,000
200
40,000
100
20,000 0
62
Number of deals
Value (USDm)
160,000
Q1 03
Q2 03
Q3 03
Q4 03
Q1 04
Q2 04
Q3 04
Q4 04
Q1 05
Q2 05
Q3 05
Q4 05
Q1 06
Q2 06
Q3 06
Q4 06
Q1 07
Q2 07
Q3 07
Q4 07
Q1 08
Q2 08
Q3 08
Q4 08
Q1 09
Q2 09
Q3 09
Q4 09
Q1 10
Q2 10*
0
AsianLegal LegalBusiness BusinessISSUE ISSUE 10.4 Asian 10.5
MARKET DATA | |M&A M&A>> >> market data
In association with
Notes:
League tables are based on geography of either target, bidder or seller company. League tables of legal advisors include lapsed and withdrawn bids, while league tables of financial advisors exclude lapsed and withdrawn bids. League tables are ranked by value•Statistics includes all deals valued over USD 5m. Where deal value not disclosed, deal has been entered based on turnover of target exceeding USD 10m•Activities excluded from statistics include property transactions and restructurings where the ultimate shareholders’ interests are not changed.•Q2 10* = 1 April 2010 to 23 April 2010
League Table of Legal Advisors to Greater China M&A (Jan 01, 2010 - Apr 23, 2010) Rank
House
League Table of Financial Advisors to Greater China M&A (Jan 01, 2010 - Apr 23, 2010)
Value (USDm)
Deal Count
Rank
Value (USDm)
Deal Count
1
Slaughter and May
38,683
4
1
Goldman Sachs
House
44,238
4
2
Herbert Smith/Gleiss Lutz/Stibbe
37,957
2
2
Deutsche Bank
41,291
6
3
Cleary Gottlieb Steen & Hamilton
35,950
3
3
Credit Suisse
40,657
5
4
Simpson Thacher & Bartlett
35,744
3
4
Citigroup
37,492
6
5
Norton Rose
35,624
2
5=
Blackstone
35,500
1
6
Sullivan & Cromwell
35,500
2
5=
HSBC
35,500
1
7=
Cravath Swaine & Moore
35,500
1
5=
JPMorgan Cazenove
35,500
1
7=
Debevoise & Plimpton
35,500
1
5=
Lazard
35,500
1
7=
Weil Gotshal & Manges
35,500
1
9
Morgan Stanley
31,252
7
10
Davis Polk & Wardwell
28,400
1
10
China International Capital
8,164
6
Based on geography of either target, bidder or seller company being China, Hong Kong, Macau or Taiwan
League Table of Legal Advisors to Japanese M&A (Jan 01, 2010 - Apr 23, 2010) Rank
House
League Table of Financial Advisors to Japanese M&A (Jan 01, 2010 - Apr 23, 2010)
Value (USDm)
Deal Count
Rank
Value (USDm)
Deal Count
1
Mori Hamada & Matsumoto
7,864
15
1
House Nomura Holdings
7,710
19
2
Skadden Arps Slate Meagher & Flom
6,885
3
2
JPMorgan
4,938
4
3
Nishimura & Asahi
5,691
10
3
UBS Investment Bank
4,014
1
4
Gibson Dunn & Crutcher
4,611
2
4
Citigroup
3,795
3
5
Latham & Watkins
4,014
1
5
Goldman Sachs
3,671
4
6
Anderson Mori & Tomotsune
3,560
9
6
Centerview Partners
2,871
1
7
Nagashima Ohno & Tsunematsu
3,397
10
7
Bank of America Merrill Lynch
1,740
1
8
Shearman & Sterling
3,333
3
8
Deutsche Bank
1,226
1
9
Morrison & Foerster
2,871
2
9
Greenhill
1,226
1
10
Dewey & LeBoeuf
2,871
1
10
Celfin Capital
924
1
Value (USDm)
Deal Count
Rank
Based on geography of either target, bidder or seller company being Japan
League Table of Legal Advisors to Indian M&A (Jan 01, 2010 - Apr 23, 2010) Rank
House
League Table of Financial Advisors to Indian M&A (Jan 01, 2010 - Apr 23, 2010) Value (USDm)
Deal Count
1
AZB & Partners
13,407
18
1
House Barclays Capital
13,311
4
2
Allen & Overy
10,761
3
2
Standard Chartered
13,097
4
3=
Herbert Smith/Gleiss Lutz/Stibbe
10,700
1
3
UBS Investment Bank
11,115
3
3=
Linklaters
10,700
1
4
HSBC
10,820
2
5
Amarchand & Mangaldas & Suresh A Shroff
1,935
4
5=
BNP Paribas
10,700
1
6
Wadia Ghandy
1,840
1
5=
Global Investment House KSCC
10,700
1
7=
Crawford Bayley
1,184
1
5=
State Bank of India
10,700
1
7=
Tozzini Freire Teixeira E Silva Advogados
1,184
1
8
Citigroup
2,130
2
7=
Veirano Advogados
1,184
1
9=
Nomura Holdings
1,840
1
10
WongPartnership
685
1
9=
Rothschild
1,840
1
Based on geography of either target, bidder or seller company being India
League Table of Legal Advisors to Southeast Asian M&A (Jan 01, 2010 - Apr 23, 2010)
League Table of Financial Advisors to Southeast Asian M&A (Jan 01, 2010 - Apr 23, 2010) Value (USDm)
Deal Count
1
Weerawong, Chinnavat & Peangpanor
3367
2
1
UBS Investment Bank
4,002
3
2
Kadir, Andri & Partners
2649
1
2
CIMB Group
2,894
7
3
Allen & Gledhill
2098
8
3
Public Investment Bank
2,885
2
4
WongPartnership
1995
10
4
Barclays Capital
2,873
2
5=
Amarchand & Mangaldas & Suresh A Shroff
1840
1
5
RHB Investment Bank
2,700
2
5=
Wadia Ghandy
1840
1
6
JPMorgan
2,649
2
7
Hunton & Williams
1258
1
7
Standard Chartered
2,617
2
8
Clifford Chance
1237
3
8
Morgan Stanley
2,194
2
9
Hughes Hubbard & Reed
1170
1
9
Citigroup
2,148
2
10
Makes & Partners
777
1
10
Deutsche Bank
2,011
3
Rank
House
Value (USDm)
Deal Count
Rank
House
Based on geography of either target, bidder or seller company being Southeast Asia
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market data | capital markets >>
Equity Capital Markets TRANSACTIONS List
Asia, inc Japan, ex Australia & New Zealand Apr 4-May 2 Issuer Proceeds Issue date (USDm)
HONG KONG COSCO Pacific Ltd Brightoil Petroleum(Hldgs)Ltd Chow Sang Sang Holdings Intl Skyworth Digital Holdings Ltd TUL Hua Han Bio-Pharm Hldg Ltd Asian Citrus Hldg Ltd China Precious Metal Resources City Telecom(HK)Ltd INDIA Essar Energy Ltd Adani Enterprises Ltd GMR Infrastructure Ltd Videocon Industries Ltd Tech Mahindra Ltd Kalpataru Power Transmission Shree Ganesh Jewellary House CORE Projects & Tech Ltd Bharat Forge Ltd INDONESIA Intiland Bk Internasional Indonesia PT Multipolar Tbk PT JAPAN Yamaha Motor Co Ltd Joyo Bank PHILIPPINES Metrobank Metro Pacific Investments Corp SOUTH KOREA Samsung Life Insurance Co Ltd Woori Fin Hldgs Co Ltd Taihan Electric Wire Co Ltd Halla Engineering & Constr TAIWAN Wintek Corp
Currency
Bookrunner(s)
Sector
601.3 128.9 128.5 116.0 109.5 91.1 69.8 53.6 52.3
04/29/10 04/12/10 04/27/10 04/13/10 04/29/10 04/15/10 04/21/10 04/29/10 04/23/10
HKD HKD HKD HKD HKD HKD HKD HKD USD
JP Morgan Securities Asia Pte; Goldman Sachs & Co Industrial & Comm Bank China Bank of America Merrill Lynch CLSA Morgan Stanley Kingston Securities Limited; First Shanghai Sec Ltd Bank of America Merrill Lynch; CLSA Oriental Patron Securities Ltd; Cantor Fitzgerald Inc Oppenheimer & Co Inc
Industrials Industrials Consumer Products and Services High Technology Healthcare Healthcare Consumer Staples Consumer Staples Telecommunications
1,943.2 331.2 313.1 249.5 146.9 101.8 83.6 75.0 61.3
04/30/10 04/28/10 04/19/10 04/23/10 04/28/10 04/30/10 04/08/10 04/15/10 04/26/10
GBP INR INR INR INR INR INR USD INR
Deutsche Bank AG; JP Morgan Cazenove ICICI Securities & Finance Co; Enam Securities; IDFC-SSKI Ltd DSP Merrill Lynch Ltd SBI Capital Markets Ltd; Indiainfoline Ltd; Link Intime India Pvt Ltd Citi Morgan Stanley; Nomura Holdings Inc; IDFC-SSKI Ltd; Collins Stewart Ltd Axis Bank Ltd; ICICI Securities & Finance Co; Avendus Capital Pvt Ltd Standard Chartered Bk (India) Axis Bank Ltd; Citigroup Global Markets India; Kotak Mahindra Capital Co
Energy and Power Consumer Products and Services Financials High Technology High Technology Energy and Power Consumer Products and Services High Technology Materials
230.1 154.8 83.7
04/09/10 04/08/10 04/12/10
IDR IDR IDR
Minna Padi Investama PT Sinartama Gunita PT Sharestar Indonesia PT
Real Estate Financials High Technology
835.1 95.8
04/13/10 04/12/10
JPY JPY
Nomura Securities Nomura Securities
Industrials Financials
112.0 94.6
04/29/10 04/15/10
MYR MYR
UBS Investment Bank CLSA
Financials Financials
4,409.1 1,033 165.7 97.4
04/23/10 04/08/10 04/14/10 04/09/10
KRW KRW KRW KRW
Korea Investment & Securities Credit Suisse; UBS Ltd; Daewoo Securities Co Ltd; Samsung Securities Tong Yang Securities Inc Woori Invest & Sec Co Ltd
Financials Financials High Technology Industrials
122.1
04/26/10
USD
JP Morgan Securities Asia Pte
High Technology
DEBT CAPITAL MARKETS TRANSACTIONS LIST
Asia, inc Japan, ex Australia & New Zealand Apr 4-May 2 Issuer Proceeds Issue date (USDm)
64
Bookrunner(s)
Sector
HKD HKD HKD
JP Morgan (Hong Kong) Hongkong & Shanghai Bank (HK) Hongkong & Shanghai Bank (HK)
Financials Financials Financials
04/29/10
INR
Financials
226.0 199.1 146.0
04/09/10 04/14/10 04/29/10
INR USD INR
Corporation Bank Steel Authority of India Ltd
123.5 123.2
04/29/10 04/16/10
INR INR
L&T Infrastructure Finance HDFC HDFC United Phosphorus Ltd IDFC IDFC IDFC INDONESIA Bakrie Telecom Pte Ltd JAPAN Japan Finance Corp Japan Housing Finance Agency Mizuho Corporate Bank Ltd Sumitomo Mitsui Banking Corp Development Bank of Japan Inc Bank of Tokyo-Mitsubishi UFJ Toyota AOT 2010-A Sekisui House Ltd ORIX Corp Japan Finance Corp NTT Data Corp Nissan Motor Co Ltd Metropolis of Tokyo Japan Finance Corp NTT Data Corp Tokyo Electric Power Co Inc Sumitomo Chemical Co Ltd JFM Japan Expressway Holding Kansai Electric Power Co Inc Central JR Hitachi Capital Corp JFM Chiba Prefecture Tokyo Electric Power Co Inc Nissan Motor Co Ltd Sumitomo Realty & Development Central Nippon Expressway All Nippon Airways Co Ltd Tokyo Metro Co Ltd Chubu Electric Power Co Inc Nippon Steel Corp Asahi Breweries Ltd Development Bank of Japan Inc Development Bank of Japan Inc Acom Co Ltd
118.6 113.0 112.6 67.8 56.5 56.3 56.3
04/16/10 04/09/10 04/05/10 04/09/10 04/09/10 04/05/10 04/05/10
INR INR INR INR INR INR INR
ICICI Sec Primary Dealership; Axis Bank Ltd; Trust Investment Advisors; Almondz Global Securities Ltd; ICICI Bank Ltd; Kotak Mahindra Finance Ltd; AK Capital Services Ltd; LKP Shares & Securities Ltd; SPA Merchant Bankers; Yes Bank Ltd; HSBC India; Edelweiss Capital; Darashaw & Co Ltd; R.R. Financial Consultants; Sec Trading Corp of India; SBI Capital Markets Ltd; Deutsche Bank (India); Real Growth Projects Ltd Standard Chartered Bk (India); Citibank NA (India); Axis Bank Ltd; SBI Capital Markets Ltd Citigroup Global Markets Inc; Deutsche Bank AG (London) Barclays Bank PLC; ICICI Sec Primary Dealership; ICICI Bank Ltd; Trust Investment Advisors; ING Vysya Bank; Deutsche Bank (India) Trust Investment Advisors; AK Capital Services Ltd Edelweiss Capital; Axis Bank Ltd; ICICI Bank Ltd; Trust Capital Services; ICICI Sec Primary Dealership; Almondz Global Securities Ltd; AK Capital Services Ltd; Deutsche Bank (India); Yes Bank Ltd; Real Growth Projects Ltd; Darashaw & Co Ltd Barclays Bank PLC ICICI Sec Primary Dealership ICICI Sec Primary Dealership Yes Bank Ltd Trust Investment Advisors Trust Investment Advisors ICICI Sec Primary Dealership; Trust Investment Advisors
Financials Financials Financials Materials Financials Financials Financials
250.0
04/30/10
USD
Credit Suisse; Bank of America Merrill Lynch; Morgan Stanley
Telecommunications
2249.5 1549.3 1394.1 1072.3 994.6 858.0 775.0 750.7 749.9 644.7 643.1 535.3 434.0 429.8 428.9 428.3 379.8 375.4 332.2 322.1 321.8 321.8 321.8 321.7 321.2 321.2 319.4 271.3 217.0 217.0 214.7 214.5 214.5 214.5 214.5 214.1
04/27/10 04/22/10 04/14/10 04/13/10 04/13/10 04/13/10 04/23/10 04/14/10 04/21/10 04/27/10 04/14/10 04/22/10 04/16/10 04/27/10 04/14/10 04/08/10 04/16/10 04/13/10 04/28/10 04/09/10 04/13/10 04/13/10 04/13/10 04/09/10 04/08/10 04/22/10 04/23/10 04/16/10 04/16/10 04/16/10 04/21/10 04/13/10 04/20/10 04/20/10 04/20/10 04/22/10
USD JPY JPY JPY USD JPY USD JPY USD JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY
Barclays Capital; BNP Paribas SA; Citi Nomura Securities Mizuho Securities Co Ltd Nikko Cordial Securities Inc Barclays Bank PLC; HSBC Holdings PLC Mitsubishi UFJ Securities Co JP Morgan; Bank of America Merrill Lynch; Barclays Capital Mitsubishi UFJ Securities Co Bank of America Merrill Lynch; Morgan Stanley & Co; UBS Investment Bank Nomura Securities; Daiwa Sec Capital Markets Mizuho Securities Co Ltd; Daiwa Sec Capital Markets Nikko Cordial Securities Inc Daiwa Sec Capital Markets Nomura Securities; Daiwa Sec Capital Markets Mizuho Securities Co Ltd; Mitsubishi UFJ Securities Co Mitsubishi UFJ Securities Co Nomura Securities Nomura Securities Mitsubishi UFJ Securities Co; Daiwa Sec Capital Markets; Nikko Cordial Securities Inc Nomura Securities Mitsubishi UFJ Securities Co; Mizuho Securities Co Ltd Mizuho Securities Co Ltd Nomura Securities Daiwa Sec Capital Markets; GSJCL Mizuho Securities Co Ltd Nikko Cordial Securities Inc Daiwa Sec Capital Markets Daiwa Sec Capital Markets; Nikko Cordial Securities Inc Nomura Securities Nomura Securities; Nikko Cordial Securities Inc Mitsubishi UFJ Securities Co Mitsubishi UFJ Securities Co; Mizuho Securities Co Ltd; Nikko Cordial Securities Inc Nomura Securities; Daiwa Sec Capital Markets Daiwa Sec Capital Markets; Nikko Cordial Securities Inc; Nomura Securities Daiwa Sec Capital Markets; Nikko Cordial Securities Inc; Nomura Securities Daiwa Sec Capital Markets; Deutsche Securities Inc
Government and Agencies Government and Agencies Financials Financials Government and Agencies Financials Financials Real Estate Financials Government and Agencies High Technology Industrials Government and Agencies Government and Agencies High Technology Energy and Power Materials Government and Agencies Government and Agencies Energy and Power Industrials Financials Government and Agencies Government and Agencies Energy and Power Industrials Real Estate Industrials Industrials Industrials Energy and Power Materials Consumer Staples Government and Agencies Government and Agencies Financials
HONG KONG Hong Kong Mortgage Corp Ltd Hong Kong Mortgage Corp Ltd Hong Kong Mortgage Corp Ltd INDIA Power Finance Corp Ltd
90.2 64.4 64.4
04/23/10 04/22/10 04/23/10
901.3
Hindustan Petroleum Corp Ltd Export-Import Bank of India NABARD
Currency
Energy and Power Financials Financials Financials Materials
Asian Legal Business ISSUE 10.5
market data | capital markets >>
JFM Mori Building Co Ltd Nissan Motor Co Ltd Central Nippon Expressway Japan Finance Corp Tokyo Metro Housing Supply Central JR Hulic Co Ltd City of Nagoya Central Nippon Expressway Japan Real Estate Investment Sumitomo Chemical Co Ltd Sumitomo Metal Industries Ltd Tokyo Metro Co Ltd City of Osaka Credit Saison Co Ltd Mitsui Fudosan Co Ltd Sankei Building Co Ltd City of Kobe Mitsui & Co Ltd Tobu Railway Co Ltd Promise Co Ltd JFM Forester SPC JFM Mitsui-Soko Co Ltd American Honda Finance JFM JFM MALAYSIA Gerbang Perdana CIQ Sdn Bhd Axiata SPV1 (Labuan) Ltd Cagamas Berhad PHILIPPINES PSALM ADB Ayala Corp RCBC ADB ADB RCBC ADB SINGAPORE Yanlord Land Group Ltd PSA Corp Ltd Otto Marine Services Pte Ltd DBS Bank Ltd City Developments Ltd SOUTH KOREA Hana Bank Hyundai Motor CZ sro New Challenge Kodit 2010 Shinhan Financial Group Ltd Korea Housing Finance Corp Woori Bank Woori Bank SK Networks Co Ltd Dongbu HiTek Co Ltd LG Electronics Inc Kookmin Bank Hana Financial Group Inc Samsung Total Petrochemicals Kyongnam Bank Woori Financial Co Ltd Shinhan Capital Co Ltd Hite Brewery Co Ltd Kosepco(KEPCO/South Korea) Kospo(KEPCO/South Korea) CJ Corp Shinhan Card Busan Bank Woori Bank Hyundai Dept Store Co Ltd Busan Bank SK Engineering & Constr Co Ltd Ssangyong Cement Indl Co Ltd Hana Bank LG Telecom Co Ltd CJ CGV Co Ltd Korea Hydro & Nuclear Power Co GS Engineering & Constr Corp Doosan Heavy Inds & Constr Co Woongjin Holdings Co Ltd Samsung Card Co Ltd Doosan Engine Co Ltd Samsung Card Co Ltd KT Rental Co Ltd Hana Bank Shinhan Card Shinhan Bank Woori Bank Posco Power Corp Poongsan Holdings Corp KDB Capital Corp POSCO Specialty Steel Co Ltd Hansol Paper Co Ltd CJ GLS Inc Samsung Card Co Ltd Hanwha Engineering & Constr Co CJ O Shopping Co Ltd Hana Bank Hyundai Capital Services Inc Export-Import Bank of Korea SK Securities Co Ltd Samsung Card Co Ltd Ssangyong Cement Indl Co Ltd Korea Development Corp TAIWAN Taipower Nan Ya Plastics Corp Formosa Plastics Corp Formosa Chem & Fibre Corp Yuen Foong Yu Paper Mnfg Co Uni-President Enterprises Corp THAILAND Thai Oil PCL PEA(Thailand)
www.legalbusinessonline.com
214.1 214.1 214.1 162.8 161.2 160.9 160.9 128.7 128.4 108.5 108.5 108.5 108.5 108.5 108.4 107.5 107.5 107.4 107.4 107.4 107.1 106.1 96.7 92.5 75.2 75.1 75.0 64.2 53.7
04/22/10 04/22/10 04/22/10 04/16/10 04/27/10 04/09/10 04/13/10 04/20/10 04/22/10 04/16/10 04/16/10 04/16/10 04/16/10 04/16/10 04/16/10 04/15/10 04/15/10 04/21/10 04/09/10 04/09/10 04/22/10 04/22/10 04/28/10 04/30/10 04/28/10 04/09/10 04/28/10 04/22/10 04/28/10
JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY JPY USD JPY JPY
Nomura Securities Mitsubishi UFJ Securities Co Nikko Cordial Securities Inc Nomura Securities Nomura Securities; Daiwa Sec Capital Markets Mizuho Securities Co Ltd; Nomura Securities Mitsubishi UFJ Securities Co; Nomura Securities Mizuho Securities Co Ltd Barclays Capital Japan Daiwa Sec Capital Markets; Nomura Securities; Nikko Cordial Securities Inc Mizuho Securities Co Ltd Mizuho Securities Co Ltd Nikko Cordial Securities Inc Nomura Securities; Nikko Cordial Securities Inc Mizuho Securities Co Ltd; Mizuho Investors Securities Co; Merrill Lynch Securities Co Mitsubishi UFJ Securities Co Nikko Cordial Securities Inc Daiwa Sec Capital Markets Daiwa Sec Capital Markets; Barclays Capital Japan Nomura Securities Mitsubishi UFJ Securities Co UBS Securities Japan Ltd Shinkin Securities Mizuho Corporate Bank Ltd Nomura Securities Nomura Securities Deutsche Bank Securities Corp Nikko Cordial Securities Inc Daiwa Sec Capital Markets
Government and Agencies Real Estate Industrials Industrials Government and Agencies Government and Agencies Industrials Real Estate Government and Agencies Industrials Real Estate Materials Materials Industrials Government and Agencies Financials Real Estate Real Estate Government and Agencies Consumer Products and Services Industrials Financials Government and Agencies Financials Government and Agencies Industrials Financials Government and Agencies Government and Agencies
314.2 299.8 156.1
04/17/10 04/22/10 04/27/10
MYR USD MYR
CIMB Investment Bank Bhd; Alliance Investment Bank Bhd Goldman Sachs & Co; Morgan Stanley; CIMB Investment Bank Bhd AmInvestment Bank Bhd
Industrials Financials Financials
671.0 369.4 225.4
04/12/10 04/20/10 04/15/10
PHP AUD PHP
Financials Government and Agencies Financials
190.7 161.6 130.2 97.8 53.9
04/15/10 04/13/10 04/14/10 04/15/10 04/13/10
PHP AUD BRL PHP NZD
Development Bk of Philippines; First Metro Investment Corp; HSBC Manila Commonwealth Bank of Australia; RBC Capital Markets; TD Securities Inc HSBC Manila; BPI Capital; BDO Capital Investment Corp; First Metro Investment Corp; RCBC Capital Corporation; ING Bank Manila; Standard Chartered (Manila); Citibank NA (Manila) HSBC Manila Nomura International PLC TD Securities Inc HSBC Manila Nomura International PLC
300.0 290.9 72.9 70.9 65.3
04/26/10 04/20/10 04/28/10 04/13/10 04/19/10
USD SGD SGD HKD SGD
HSBC Holdings PLC; RBS; Standard Chartered Bank PLC DBS Bank Ltd Standard Chartered Bank (SG) Standard Chartered Bank (HK); DBS Bank (Hong Kong) Ltd DBS Bank Ltd
Real Estate Industrials Financials Financials Real Estate
499.2 498.5 408.6 403.7 372.8 311.5 241.4 224.3 207.5 171.4 147.3 135.3 134.3 133.5 125.2 117.3 107.4 106.8 100.0 98.5 97.9 90.6 90.2 90.2 90.1 90.1 90.1 90.0 89.7 89.5 89.5 89.1 89.0 80.7 80.2 72.2 72.0 71.6 71.6 63.1 63.1 63.1 62.8 62.7 54.2 54.1 54.1 54.1 54.0 53.8 53.7 52.2 50.0 49.6 45.3 45.1 45.1 45.1
04/26/10 04/12/10 04/22/10 04/29/10 04/23/10 04/06/10 04/19/10 04/30/10 04/23/10 04/22/10 04/05/10 04/23/10 04/20/10 04/06/10 04/19/10 04/15/10 04/09/10 04/08/10 04/15/10 04/09/10 04/06/10 04/26/10 04/15/10 04/23/10 04/16/10 04/16/10 04/27/10 04/14/10 04/30/10 04/09/10 04/20/10 04/05/10 04/06/10 04/12/10 04/05/10 04/15/10 04/14/10 04/09/10 04/27/10 04/15/10 04/16/10 04/16/10 04/30/10 04/09/10 04/21/10 04/15/10 04/22/10 04/28/10 04/14/10 04/29/10 04/09/10 04/09/10 04/23/10 04/30/10 04/26/10 04/16/10 04/19/10 04/28/10
USD USD KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW USD KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW KRW USD SGD KRW KRW KRW KRW
Bank of America Merrill Lynch; Citi; JP Morgan; RBS; Hana Bank Barclays Capital; Bank of America Merrill Lynch; Citi; Goldman Sachs & Co; Nomura Securities Tong Yang Securities; Bookook Securities Co Ltd; IBK Securities Co Ltd; Woori Invest & Sec Co Ltd SK Securities Co Ltd E Trade Korea Co Ltd; Hanwha Securities Co; KB Invest & Sec Hana Daetoo Securities Co Ltd Hana Daetoo Securities Co Ltd Hana Daetoo Securities Co Ltd Dongbu Securities Woori Invest & Sec Co Ltd Kyobo Securities Co Ltd SC Securities Korea Ltd Daewoo Securities Co Ltd; SK Securities Co Ltd Hyundai Securities Co Ltd Korea Investment & Securities SC Securities Korea Ltd Korea Investment & Securities KB Invest & Sec Woori Invest & Sec Co Ltd Samsung Securities; Korea Investment & Securities Samsung Securities Korea Investment & Securities KB Invest & Sec Korea Investment & Securities Hana Daetoo Securities Co Ltd Mirae Asset Securities; SC Securities Korea Ltd Korea Development Bank SC Securities Korea Ltd Korea Investment & Securities; LIG Investment & Securities Co Daewoo Securities Co Ltd Woori Invest & Sec Co Ltd KB Invest & Sec KB Invest & Sec Woori Invest & Sec Co Ltd SC Securities Korea Ltd Kumho Investment Bank SC Securities Korea Ltd Hyundai Securities Co Ltd; Tong Yang Securities; Woori Invest & Sec Co Ltd; KB Invest & Sec SC Securities Korea Ltd Dongbu Securities Mirae Asset Securities SC Securities Korea Ltd KB Invest & Sec SK Securities Co Ltd Hyundai Securities Co Ltd Tong Yang Securities Kiwoom Securities Co Tong Yang Securities Shinhan Investment Bank Shinhan Investment Corp Samsung Securities SC Securities Korea Ltd Korea Investment & Securities Standard Chartered Bank PLC Shinhan Investment Corp SC Securities Korea Ltd Hanwha Securities Co Tong Yang Securities
Financials Industrials Financials Financials Financials Financials Financials Telecommunications Materials High Technology Financials Financials Materials Financials Financials Financials Consumer Staples Energy and Power Energy and Power Financials Financials Financials Financials Retail Financials Industrials Materials Financials Telecommunications Media and Entertainment Energy and Power Industrials Industrials Financials Financials Industrials Financials Consumer Products and Services Financials Financials Financials Financials Energy and Power Materials Financials Materials Materials Industrials Financials Industrials Media and Entertainment Financials Financials Financials Financials Financials Materials Consumer Products and Services
369.6 191.6 191.5 191.5 79.9 69.8
04/22/10 04/30/10 04/23/10 04/23/10 04/26/10 04/12/10
TWD TWD TWD TWD TWD TWD
Standard Chartered (Taiwan) Mega Securities Co Ltd Masterlink Securities Co Capital Securities Corp KGI Securities (Taiwan) Fubon Securities Co Ltd
Energy and Power Materials Materials Consumer Staples Materials Consumer Products and Services
93.0 46.5
04/29/10 04/27/10
THB THB
Standard Chartered Bank(Thai) Hongkong & Shanghai Banking
Energy and Power Energy and Power
Financials Government and Agencies Government and Agencies Financials Government and Agencies
65