THE AM LAW DAILY

SURVEYS AND RANKINGS

MAGAZINE

SPECIAL REPORTS

The Work

January 11, 2010 1:53 PM

Cleary, Gibson Dunn Slake M&A Thirst With $7.6 Billion Beer Deal

Posted by Brian Baxter

UPDATE: Jan. 14, 8:15 a.m. The ninth and tenth paragraphs of this post have been updated with corrected information from Legal Week.

In what might be the most interesting deal so far in 2010, Heineken has agreed to a $7.6 billion buyout of Mexican brewer Femsa. The deal means plenty of work for the four lead firms handling the matter.

MostInteresting

Cleary Gottlieb Steen & Hamilton M&A partner Jaime El Koury in New York advised Fomento Económico Mexicano (Femsa), which owns the Mexican beer brands Tecate, Sol, Indio, and Dos Equis. (Dos Equis's "most interesting man in the world" ad campaign in the U.S.--a still from the ad appears here--has gotten a good bit of attention for its utter ridiculousness.)

The firm previously advised Femsa on its acquisition of shares from a subsidiary it co-owns with Coca-Cola and a $700 million global equity offering in 2005. El Koury did not immediately return a request for comment on Monday's announced deal.

Gibson, Dunn & Crutcher corporate partner Stephan Haimo in New York led a team from the firm advising Heineken on the all-stock transaction, which includes roughly $2 billion in debt and pension obligations. The firm has long handled litigation and corporate M&A work for Heineken. Haimo says he advised the Dutch brewer on its first major North American acquisition in 1991.

"I advised Heineken on its acquisition of Van Munching & Co., which was the exclusive importer of Heineken beer in the U.S.," Haimo says. "Up until that time, if you ever had a Heineken beer in the U.S., it always said, 'Imported by Van Munching & Co.'"

Haimo says he continued to advise Heineken on all of its M&A activity in the Americas, which included the acquisition of Chile's CCU in 2003. On the Femsa transaction, Haimo cited the creation of an "alloted share delivery instrument" that will enable Heineken to deliver about 25 percent of the stock being issued to finance the deal over five years. As the first major deal of the year, he's hopeful that the Femsa acquisition will be a harbinger of better times for M&A lawyers coping with the slowdown in deal work this past year.

"There will always be room for strategic plays that produce synergies and ally businesses across the globe," Haimo says. "And I think you'll continue to see that trend in 2010."

Gibson Dunn international tax partner Jeffrey Trinklein, capital markets cochair Steven Finley, and corporate partners Eduardo Gallardo, Robert Cunningham, William Candelaria, and Daniel Mummery rounded out the legal team that advised the Dutch brewer from New York, Los Angeles, and Palo Alto.

Also advising on the deal are Magic Circle firm Freshfields Bruckhaus Deringer and two leading Latin American law firms.

Legal Week reports that Freshfields corporate partner Julian Long in London is Femsa's European legal counsel, while Amsterdam-based Heineken was advised on local legal issues by Mexico's Galicia & Robles and Brazil's Mundie e Advogados.

Femsa controls nearly half of the beer market in Mexico and nearly 10 percent of the market in Brazil, two countries with fast-growing economies that reportedly are in the world's top four most profitable beer markets. Femsa's Tecate and Dos Equis brands are also popular in the U.S.

Another likely driver for the deal: the acquisition of Monterrey-based Femsa will consolidate Heineken's position as the second-largest brewer in the world by sales behind Anheuser-Busch InBev.

InBev aquired A-B last year in a $52 billion deal. Sullivan & Cromwell and Skadden, Arps, Slate, Meagher & Flom were the lead legal advisors on the deal; Howrey, Clifford Chance, Linklaters, and Simpson Thacher & Bartlett also advised.

Make a comment

Comments (0)
Save & Share: Facebook | Del.ic.ious | | Email |

Reprints & Permissions

Comments

Report offensive comments to The Am Law Daily.

Post a comment

If you have a TypeKey or TypePad account, please Sign In





By: TwitterButtons.comhttp://www.facebookloginhut.com/facebook-login/


theamlawdaily@alm.com




From the Law.com Newswire

Sign up to receive Legal Blog Watch by email
View a Sample

Advertisement