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November 11, 2011 9:49 AM

V&E, Linklaters Advise as Sinopec Takes a $5.2 Billion Gulp from Galp

Posted by Ed Shanahan

Vinson & Elkins and Linklaters have the lead roles advising on the $3.5 billion acquisition by China Petroleum and Chemical Corp. Ltd., better known as Sinopec, of Brazilian assets of Portuguese oil and gas company Galp Energia SGPS S.A., according to Jessica Seah of sibling publication The Asian Lawyer.

Seah reports that the deal's terms call for Lisbon-based Galp to sell 30 percent of its Brazilian assets to state-owned Sinopec, including interests in four deep-water blocks of the Atlantic Ocean's oil-rich Santos Basin. The deal, which is subject to Chinese governmental approval, will see Sinopec subscribe to new shares issued by Galp, according to Seah.

According to a Bloomberg report, Sinopec's projected total investment in the unit is expected to reach roughly $5.2 billion.

As its lead outside legal advisers on the transaction, Sinopec turned to Vinson & Elkins Shanghai partners Jay Kolb and David Blumental, who also represented the Chinese company in another Brazilian acquisition last year, Seah reports. In that October 2010 deal, Sinopec paid $7.1 billion for a 40 percent interest in the Brazilian assets of Spanish oil giant Repsol YPF S.A. Hong Kong partner Xiao Yong also advised on the Galp transaction.

Seah notes that Vinson & Elkins has previously advised Sinopec on many of its major acquisitions including an $8.8 billion acquisition of Canada's Addax Petroleum Corp. in 2009 and a $2.1 billion acquisition of Calgary-based Daylight Energy Ltd. last month.

Linklaters's Sao Paulo office is representing Galp, according to Seah. The firm did not respond to The Asian Lawyer's request for comment.

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