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July 15, 2011 2:15 PM

Three Firms Take Lead on BHP Billiton's $12.1 Billion Petrohawk Bid

Posted by Brian Baxter

UPDATE: 7/28/11, 12:45 p.m. Magic Circle firms Allen & Overy and Slaughter and May have also lined up financing roles on the deal, according to U.K. publication Legal Week.

Anglo-Australian mining giant BHP Billiton announced late Thursday that it will acquire Houston-based oil and gas producer Petrohawk Energy in a proposed $12.1 billion deal.

By moving to snap up Petrohawk and its holdings in the increasingly lucrative shale market, Melbourne-based BHP, one of the world's largest producers of iron ore and coal, aims to bolster its natural gas assets, according to reports by Reuters and The New York Times.

Simpson Thacher & Bartlett M&A partners Lee Meyerson and Eric Swedenburg, employee benefits partner Andrea Wahlquist, tax partner Nancy Mehlman, and environmental senior counsel Adeeb Fadil are advising Petrohawk on its sale to BHP. The firm has previously handled litigation work for Petrohawk.

David Elkhouri, a cofounder of the Hinkle Law Firm in Kansas, has served as Petrohawk's general counsel since 2007. Thompson & Knight of counsel James Irish III, a former managing partner of the firm and cochair of its energy practice, serves on Petrohawk's board of directors. (Last year Petrohawk tapped Houston's Porter & Hedges for the $875 million sale of a 50 percent stake in certain shale assets to Kinder Morgan Energy Partners.)

Sullivan & Cromwell and Morgan, Lewis & Bockius are serving as cocounsel to BHP on the proposed Petrohawk acquisition. S&C has previously advised BHP on several matters, including the company's spin-off of its steel unit in 2002, while Morgan Lewis represented BHP earlier this year on its $4.75 billion acquisition of Chesapeake Energy's Fayetteville Shale assets.

M&A partners James Morphy and Krishna Veeraraghavan, M&A of counsel Janet Geldzahler, employee benefits partner Matthew Friestedt and special counsel Henrik Patel, tax partner Ronald Creamer, and finance partners John Estes and S. Neal McKnight are leading an S&C team advising BHP on the deal.

The Morgan Lewis team representing BHP is led by energy transactions chair David Asmus, who joined the firm in a high-profile lateral move from Baker Botts two years ago. Also advising BHP: Morgan Lewis M&A cochair Steven Navarro, business and finance partners Michael King and Thomas D'Ambrosio, employee benefits partners Amy Kelly and Daniel Hogans, labor and employment partner Stanley Lechner, energy regulatory partner Mark Haskell and senior counsel Christopher McAuliffe, antitrust partners Harry Robbins and Stephen Mahinka, real estate partner Jeannine Bishop, and environmental litigation of counsel Maxine Woelfling.

Senior counsel Anthony Austin in Melbourne and group legal manager Justin Stuhldreher in Houston are leading BHP's in-house legal team on the acquisition. BHP's chief in-house legal officer is David Williamson, who joined the company last year from one of Australia's top firms, Blake Dawson. Williamson succeeded Mike Ferraro, who returned to another top Aussie firm, Freehills, last summer.

While in private practice at Blake Dawson, Williamson advised BHP on its ill-fated $68 billion hostile bid for Melbourne-based rival Rio Tinto, which many feared would create a monopoly in the mining sector.

Several major Am Law 100 and international firms landed key advisory roles on that aborted deal, which collapsed in November 2008. The European Commission subsequently nixed an iron ore joint venture between BHP and Rio Tinto last fall, shortly before BHP's $40 billion bid to acquire the Potash Corporation of Saskatchewan fell apart.

BHP hopes that its proposed purchase of Petrohawk hits a few less regulatory hurdles. The company emphasized in a statement announcing the all-cash deal that it would "retain Petrohawk's sizable U.S.-based workforce." Petrohawk's board of directors has recommended that the company's shareholders accept the offer.

In the event that it does clear the necessary regulatory and shareholder approvals, the deal is expected to close in the third quarter of this year.

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