May 21, 2010 5:13 PM

Wachtell Advising JCI on Visteon Bankruptcy Bid

Posted by Brian Baxter

Wachtell, Lipton, Rosen & Katz is advising Milwaukee-based auto parts supplier Johnson Controls, Inc., on a $1.25 billion unsolicited bid for the automotive interiors and electronics business of bankrupt rival Visteon. JCI hopes the potential acquisition will bolster its business in China, according to The Detroit News. But Visteon isn't acquiescing just yet.

Sources with knowledge of the offer say that Philip Mindlin, a member of Wachtell's restructuring and finance practice, is advising JCI. Mindlin did not respond to a request for comment, nor did Adam Emmerich, a Wachtell M&A partner said to be heading up a corporate team from the firm working on the potential deal, sources say.

Visteon, based in Van Buren Township, Mich., filed for bankruptcy a year ago, a turbulent time in the U.S. auto industry. The auto parts supplier used to be a subsidiary of Ford Motor, but was spun off by the automaker in 2000. Ford agreed to provide debtor-in-possession financing for Visteon so it could continue operations in Chapter 11.

In a statement, Visteon says JCI's offer for two-thirds of its operations still lacks important details and "remains highly conditional."

By going public with its offer for the assets of a bankrupt rival, JCI's bid in some respects is similar to the maneuver that Simon Property Group used when trying to acquire shopping mall rival General Growth Properties earlier this year. (Wachtell also advised Simon on that offer, which was revised. Simon ultimately was unsuccessful in its efforts to buy General Growth.)

Kirkland & Ellis has been advising Visteon in Chapter 11 proceedings. According to its latest bankruptcy court filing requesting compensation, the firm has billed Visteon for nearly $34 million in fees and expenses since the company first filed for bankruptcy in Delaware on May 28, 2009. Billing rates for Kirkland partners working on the matter range from $995 per hour on the high end to $640 per hour, according to the filing.

Restructuring partners James Sprayregen ($995 per hour) and Marc Kieselstein ($935) are leading a team from the firm on the matter that also includes restructuring partners James Mazza, Jr. ($690) and Brian Lennon ($660), corporate partner Howard Norber ($640), and litigation partners Steven McCormick ($895), Andrew McGaan ($775), Andrew Bloomer ($745), Patrick Bryan ($600), and R. Chris Heck ($645).

Kirkland's expertise on the bankruptcy beat is no secret. The firm served as Chapter 11 cocounsel with Weil, Gotshal & Manges to General Growth on the aforementioned bankruptcy battle with Simon. On Thursday, Kirkland helped General Growth finish restructuring the last of its 108 secured loans for each of the company's mall units, none of which were litigated.

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