Understand Your Rights. Solve Your Legal Problems
This month Lawyer Monthly had the pleasure of speaking with Mollie Stoker, General Counsel at Lucozade Ribena Suntory (LRS), the conceived company from when Suntory Beverage & Food, the world's 3rd largest soft drinks company, acquired Lucozade and Ribena.
Mollie Stoker’s can-do style has helped build a highly visible and well-regarded legal team from scratch. She sits on the board of the new soft drinks company. Here she talks us through that process, the goals of LRS, the challenges in managing a strong team of lawyers, and the personal and professional rewards that keep the team driven and passionate about the business.
What does your role at LRS involve? What are the kinds of tasks you engage in daily, and what’s out of the ordinary?
No two days are ever the same at Lucozade Ribena Suntory. My day to day job involves overseeing, supporting and enabling the legal team, ensuring they’re focused on their respective roles and that ultimately, all of our work aligns with LRS’ overall business priorities and objectives. This year, our focus has been on developing strategic ways of business partnering within LRS and refining our strategic vision for intellectual property matters.
We’ve continued to work on developing strong incident management procedures and pulling together cross-functional teams to ensure all work streams during an incident are handled in a streamlined and effective way. Setting up the corporate governance and risk management structures from scratch around the ongoing business has been an out of the ordinary task but now the legal team are likely to engage in corporate governance and risk management matters on a regular basis. In addition to my usual role, I sit on a number of committees, including chairing the Risk Management Committee and sitting on the Ethics and Compliance committee.
Creating an ethical culture within LRS is something that’s extremely important to my team. We want to engage the hearts and minds of all our employees to encourage them to do things in the right way, both legally and morally. In a way, I think of it as sprinkling magic dust on what could be perceived as dull legal documents, processes and procedures, to ensure that we reflect the vibrant culture of the company whilst keeping us safe from a legal perspective.
Who do you work with day to day, and what kind of relationships do you cultivate within the company?
We are committed to a ‘one team’ environment at LRS and do not want silos to exist. The legal team are involved in, and have access to, almost every function in the business, so we are lucky enough to have a unique perspective on how everything sits within the wider business. My team’s role is to help make things happen and ensure the sustainability of our business plans. To achieve this, developing strong relationships is key; you can never spend too much time sitting down for a coffee with colleagues, learning about each person as an individual and how you can best work together. Within the UK and Ireland legal team there are two IP lawyers, two commercial lawyers, a professional support lawyer and myself. We are also about to take on a trainee-lawyer from our procurement team, which is an exciting addition to the legal team, where we will benefit from his expertise on handling suppliers and the realities of managing short and long term implications of contracts, as much as he will benefit from learning key legal skills.
What are the primary compliance and regulatory considerations you have to make on behalf of Lucozade Ribena Suntory? What have been the most recent priorities for your legal team?
At LRS, we have a strong, highly regarded regulatory team who are experts in food law and who the legal team work closely with. Our primary compliance and regulatory considerations therefore revolve around matters such as marketing and advertising law, competition law and anti-bribery and corruption laws. We are also working with our European colleagues to ready the business for the forthcoming General Data Protection Regulation. Our consumers are at the heart of everything we do, and accordingly ensuring our brands continue to be trusted is absolutely critical. Therefore, if anything occurs or could occur that has the potential to impact on or affect the reputation of our brands, this is a key priority for the legal team.
How are these considerations managed on a global level, and throughout the entirety of the company’s ranks?
The Suntory Beverage and Food group is an international business that has allowed LRS and its sister companies to develop their global brands in a way that is best for the global business. However, they also work on an understanding that local territories differ and local consumers have different needs across the globe, therefore from a legal perspective, we have been supported to create the right legal frameworks and corporate governance structures for our local territories whilst always working closely with our regional and parent company colleagues to ensure the existence of as cohesive arrangements in the group as possible.
What environmental and nutritional concerns do you have to prioritise in regards to the company’s products?
Ultimately, our business has a strong desire to create a sustainable future for itself, to take into account the interests of all its stakeholders and to seek out new opportunities while always mitigating potential risks. For example, we look at Brexit as an opportunity to review existing regulations that may or may not be retained as part of UK legislation in future, and to then have a voice in discussing any changes that may be appropriate for our business and the wider environment.
Having built this team ‘from scratch’, what would you say has been the biggest difficulty since the inception of the new company? How did you help navigate this?
I am fortunate to have an amazing team at LRS, all of whom have the right fit for the company culture. It’s been incredible to have had the freedom to set the team up in the way I thought best, with the right people in the right way. Ultimately, LRS wants to be the best place to work, and to do that, we want to inspire our employees and team members to realise their potential and what they can do for this company.
I believe the biggest challenge for any legal team, new or otherwise, is overcoming the perception of being the ‘no police’. I wanted to try and build legal in a different way. I want the team to be seen as enablers, helping to write the creative process from the very beginning, ensuring that ideas and structures are robust, not just providing the rubber stamp at the end. I wanted legal to take its place at the front line, and only through doing this can you have a team that feel inspired, part of the LRS story, and therefore motivated to deliver their best.
Despite certain challenges, what are the overall rewards, both personal and professional, of your GC role? What is your favourite part of the job?
I’ve surprised myself with this position in the reward and enjoyment that I’ve taken in a role of leadership. I love being part of the executive committee; having exposure to those with different expertise, learning about best practice in the way other parts of the company work, and using that knowledge to enhance legal delivery to the business.
Are you ever involved in IP or PI issues as a result of the company’s products? Do these often have simple or complex resolutions?
As our brands are so well known, and our manufacturing processes dedicated to the pursuit of quality and safety, the need to solve difficult occurrences in these areas is relatively rare. We’re always keen on finding them and/or dealing with them before they become an issue, and then having efficient processes and procedures to deal with them should they occur. We mostly handle these issues internally, not only because we have the capabilities to do so, but also because we know our brands and products best, and we work closely with the other functions, which enables us to have effective, streamlined and organised processes that are best all round for the business and for our consumers.
How would you say the ‘Internet of Things’ is changing the priorities and considerations of in-house counsels around the world? In regards to this, what risk management steps would you define as paramount to the safe future running of the business?
From a legal perspective, the internet of things is a new area of risk, largely unregulated, that we will need to ensure we are up to date with as regards the important legal issues such as confidentiality, data privacy and cyber security. However, it also provides huge and exciting opportunities which can help not only make our products easier to buy, but also allow us to be better connected with our consumers and develop a deeper understanding of their needs. It may also provide opportunities to track and monitor our products in a way we haven’t been able to so far, contributing to making our products even safer for our customers and consumers. So the legal team will need to lean into this to enable the business to make the most out of these opportunities in as safe and robust way as possible.
When you first jumped into this role, what were your personal goals and professional ambitions? Have these changed since the inception of the new company in 2014?
When I joined the team, I thought I would mainly be engaged in only the legal issues that arise, but I have actually had the opportunity to substantially develop my skills in leadership across the business, in management and in strategic thought and vision. Ultimately, I am able to work with a cross-functional team, supporting them with all the good things that arise with having legal skills such as the ability to be cohesive, thoughtful and incisive. We aim for excellence, not only when it comes to execution and delivering results, but also more broadly across the business.
Is there anything else you would like to add?
The LRS motto taken with pride from our Japanese owners – Yatte Minahare (roughly translated as “go for it!”) - is at the heart of our DNA, and something the legal team happily applies in its approach to challenges by not only seeing the opportunities as much as the risks in those moments, but also by working with agility, passion and commitment to find the best solutions.
Exult and Newgen recently announced that Newgen has acquired a majority stake in Pune’s Exult Infosolutions, a company engaged in Learning Solutions, Mobility and Web application services and products. This acquisition would help Carlyle Group-backed Newgen enter the space of e-Learning and mobility across multiple new markets. NewgenKnowledgeWorks is a Chennai, India based leading provider of publishing and technical services to global publishers.
Exult has over eight and half years of experience in consulting and outsourcing services. Exult helps Fortune 1000 leading global businesses to achieve training goals by providing Custom Learning Solutions, Software Application Development, Mobility Solutions, and UI/UX Design.
Both companies are key players in the content development and transformation space. While Newgen focuses more on the traditional piece of publishing, Exult is more futuristic in terms of Digital services and products, enterprise mobile apps and cloud based application. This creates substantial opportunities to Newgen to reach out to their vast customer base with all these new service offerings. Exult would benefit from an expanded customer outreach, executive management support and opportunities to expand into newer verticals.
Since the world of education, corporate training and publishing is changing at a very fast pace, the timing of this partnership could not have been better.
Interview with Sameena Chatrapathy - Partner Universal Legal, Attorneys at Law:
Please tell me about your involvement in the deal?
Universal Legal, Attorneys at Law represented NewgenDigitalWorks Group on the transaction. I led the team from Universal Legal through the transaction cycle. Our role involved legal risk assessment of the target company and thereafter drafting, negotiation and closure of the transaction documents. We were deeply involved at every stage of the transaction to facilitate an effective closure.
Why is this a good deal for all involved?
Newgen is a client we have been servicing since 2010 and this is a major step in the growth of their business. It’s an immense privilege for us to have advised them on this acquisition.
What challenges arose? How did you navigate them?
The timelines were extremely stringent on the closure of the transaction, typical to any significant acquisition of this nature. In order to meet this challenge, we deployed an experienced team that worked together under pressure to ensure a smooth, successful and timely closure.
SpeedCast International Limited (ASX: SDA), a leading global satellite communications and network service provider, recently announced the acquisition of WINS Limited (WINS), a leading Europe-based provider of innovative broadband satellite communications and IT solutions for the maritime sector.
WINS provides services to over 100 passenger carrying vessels such as cruise liners and ferries and more than 2,000 merchant shipping vessels with a portfolio of VSAT, L-Band, Accounting Authority Services and International Maritime GSM service. The combination of SpeedCast's unrivaled global service and operational network and WINS' strong establishment in the European market will enable SpeedCast to grow its business rapidly in this exciting market.
"We are very pleased to welcome WINS to our family," SpeedCast CEO, Pierre-Jean Beylier, commented. "This acquisition is further affirmation of SpeedCast's growth strategies, and is a significant milestone for us. WINS brings a strong local presence in Germany, a major maritime market, as well as expertise in the cruise industry in Europe, a fast growing user of satellite communications. Together, we are well poised to expand our network to support the growing demand of VSAT services in the maritime sector." Pierre-Jean Beylier added.
Tony Mejlaq, Chairman and CEO of WINS said: "We founded WINS with a vision of connecting users in any location, no matter how remote. Becoming part of the SpeedCast family enables us to join a group with real international connections, providing us with access to new markets. We are very excited to join the SpeedCast family and deliver new service capabilities to our customers. Our customers will benefit from the enhanced customer service network and world class infrastructure."
Interview with Andrew J. Zammit, Managing Partner at GVZH Advocates:
Please tell me about your involvement in the deal?
GVZH Advocates were engaged as Maltese legal counsel to SpeedCast in relation to the corporate acquisition of Wins Limited (Malta) by SpeedCast International Limited, in what represented a significant investment in a Maltese telecommunications company. The terms and conditions applicable to the parties in respect of the acquisition were principally consolidated into the main Share Purchase Agreement, which necessitated a thorough review of the provisions thereof in light of Maltese law considerations, such as registration formalities and requirements, procedures and statutory filings, as well as employment related matters.
The acquisition process also entailed the drafting and review of new and existing employment agreements, assignment agreements in respect of existing loans pertaining to the target entity, as well as other documentation drawn up for purposes of good corporate governance and to ensure that the requisite formalities in terms of Maltese law were observed. In addition, GVZH Advocates were also requested to carry out a legal due diligence exercise in respect of the target entity to confirm, among other things, that Wins Limited has been legally established and is in good standing in terms of Maltese law.
Why is this a good deal for all involved?
M&As typically form an essential part of a strong corporate growth strategy. Cross-border transactions of this nature play an important role in business expansion and in extending the corporate playing field across multiple jurisdictions. The acquisition of Wins Limited will certainly strengthen SpeedCast’s international network and will reinforce its position in the European market. On the other hand, the target entity is now able to benefit from SpeedCast’s far-reaching resources and extended business network. Moreover, Wins Limited also acquired the capacity of further development in international markets and thus rendering the attainment of higher-level business goals and targets possible.
What challenges arose? How did you navigate them?
Aside from ordinary challenges which recur throughout most M&A transactions, the principal challenge of this transaction would have to be pinned down to the fact that the key parties are situated in different time-zones. The considerable time-difference rendered communication problematic and may have had an impact on the timeliness of deliverables by the parties involved. All parties involved contributed towards minimising any possible resulting delays.
EQT VII recently signed an agreement with Bilfinger SE (Bilfinger) to acquire Bilfinger’s business segment Building and Facility subject to the receipt of customary regulatory approvals. The purchase price corresponds to an enterprise value of EUR 1.4 billion. It comprises a cash component and a deferred purchase price component with annual interest upon maturity.
As part of the agreement, Bilfinger has secured a share in the future exit proceeds of EQT from Building and Facility through an instrument similar to an earn-out. Building and Facility is the biggest real-estate service provider in the DACH region and also a leading player in the segment in the UK. It includes three divisions: Facility Services, Real Estate, and Building, and employs more than 20,000 people. The annual output volume generated amounts to around EUR 2.5 billion.
Building and Facility is set to continue to grow profitably with EQT VII as new owner. The European real-estate services sector is a promising market, which is set to benefit from the growth rate of outsourced real-estate services. Building and Facility is already the No.1 integrated Real Estate service provider in the DACH region and has strong market positions in the UK, Italy, the Netherlands, Poland and Turkey. Focus going forward lies on further developing the integrated services offering across its growing European platform.
“The plan is to expand Building and Facility’s already strong platform by organic growth as well as via acquisitions and to grow stronger than the market in Europe. The intention is to create a European leader in the real-estate services sector and EQT will invest in the company accordingly,” said Dr Andreas Aschenbrenner, Partner at EQT Partners, and Investment Advisor to EQT VII. “To achieve this, we look forward to working together with the experienced and successful management of all the three divisions,” he adds.
Interview with David Barclay of GSK Luxembourg SA:
Please tell me about your involvement in the deal?
As legal advisors to EQT of matters relating to Luxembourg companies law, prior to the closing of the transaction our involvement consisted of implementation and organisation of the acquisition structure, negotiation of transaction documentation relating to the transaction, and in particular the (equity and debt) instruments issued by the various Luxembourg entities being part of the acquisition structure, and various security arrangements granted in connection thereto.
At the closing of the transaction, our role involved introducing the funds flow to acquire the target, which was established inter alia by way of capital measures (for instance, an increase of share capital) at the relevant company level, including, as necessary, negotiation of a full restatement of the constitutive documents with the shareholders of each company to contain the most necessary terms of the transaction.
Post-closing, we are presently on-boarding the existing management team of the target to a management equity program.
Why is this a good deal for all involved?
The deal was innovative and a landmark deal for EQT and for all parties involved, as it provided new financial and know-how means to the target group to further propel their business activities and strategies.
What challenges arose? How did you navigate them?
Taking account of the size, nature and complexity of the transaction, overall it ran relatively smooth, of course subject to thorough negotiation, which always entails certain challenges. To a large extent however, these challenges were overcome due to the professional and forthcoming working approach applied by all parties involved, as well as their advisors.
Also, the fact that the seller was a large corporation, the shares of which are listed on a regulated market, as opposed to another private equity player meant that there were specific internal measures in place that influenced the closing steps to be performed. This was resolved by a pragmatic approach from all involved in order to further ensure the closing was completed without any considerable obstacles or undue delay.
Dragon Capital Investments Limited, a member of the Dragon Capital group of companies, has completed the acquisition of stakes in two large logistics centres in the Kyiv suburbs.
The company acquired East Gate Logistic, a class A complex located in Boryspil, from Akron Investment Central Eastern Europe II B.V., and 60% of West Gate Logistic, a class A facility located in Stoyanka, from GLD Holding GmbH. The deal values were not disclosed.
Built in 2007, East Gate Logistic has 49,600 square meters of total space and a leasable area of 49,100 square meters. West Gate Logistic was built in 2008 and has 97,200 square meters of total and 96,300 square meters of leasable area. The two sites combined account for more than 10% of class A warehousing space in Ukraine. The total area of the two complexes constitutes more than 10% of Class A warehousing space in Ukraine. The deals values were not disclosed.
The Integrites acted as legal advisor to Dragon Capital Investments Limited, with a team led by Partner and Head of Corporate & M&A Practice Svyatoslav Sheremeta.
Stelios Americanos & Co LLC acted as Cyprus legal advisors, on the seller’s side, at the complex stake acquisition project related to two logistics centres in Ukraine acquired by Dragon Capital.
Comments from Svyatoslav Sheremeta, Partner and Head of Corporate & M&A Practice at Integrites:
The Integrites acted as a legal advisor to Dragon Capital Investments Limited, a member of the Dragon Capital group of companies, on the acquisition of stakes in two large logistics centres nearby Kyiv, Ukraine.
We believe that by the deal value and the number of involved parties it could be referred to as one of the largest and most complex transactions on the Ukrainian real estate market. Our team has provided to the Dragon Capital Group a complex legal support within the framework of this transaction. We carried out legal due diligence of the assets, took an active role in the development of the comprehensive transaction structure, and prepared transaction documents, as well as supporting the client during the completion of the acquisition procedures, and coordinating work in several jurisdictions.
The Integrites’ multi-practice team was led by partner Svyatoslav Sheremeta (M&A, corporate) with the support of partner Oleh Zahnitko (Banking & Finance). It also included senior associate Gennadii Roschepii and associate Olena Savchuk, who provided advice on real estate and contract security arrangements, respectively. Senior associate Pavlo Loginov advised the client on antitrust legal matters.
Integrites is an international law firm with full-service offices in Ukraine, Russia, Kazakhstan and representative offices in the UK, the Netherlands, Germany, and China. In March 2016 Integrites won The Lawyer European Awards 2016 in the category ‘The Firm of the Year: Russia, Ukraine & the CIS’.
China National Chemical Corporation (ChemChina) has successfully completed the acquisition of the KraussMaffei Group from Onex Corporation (Onex). All relevant regulatory approvals have been achieved. In the future, the KraussMaffei Group will be ChemChina’s principal business entity in the operating and managing of related machinery enterprises. Drawing strengths from both sides, the KraussMaffei Group will continue to develop and compete in the international market.
“KraussMaffei Group will instill the robust German Industry 4.0 gene and the manufacturing tradition of craftsmanship into ChemChina’s advanced manufacturing segment, so as to provide integrated solutions to more customers around the world, especially in the emerging markets, thus complementing our shortcoming, and I think that this embodies the true meaning of supply-side reform, because here lies huge market demand”, said Jianxin Ren, Chairman of ChemChina.
“The transaction will enable us to gain stronger access to the market of the Greater China Region. We intend to accelerate our growth in Asia and particularly in China, which will also strengthen our company both in Germany and in the rest of Europe”, said Frank Stieler, CEO of the KraussMaffei Group.
Securing this growth opportunity will also lead to an increase in our workforce outside China, particularly in Germany. The employee representatives and IG Metall welcome the change in ownership.
Beyne NV, a Belgian manufacturer of agricultural sprayers, has taken over Vogel & Noot, an Austrian producer of tillage and seeders, which went bankrupt in August 2016. Beyne takes over the grounds, buildings and spare parts of Vogel & Noot in Wartberg, Austria, as well as the production of spare parts for various other brands (Premium Parts). The acquisition of AGROROM, the Vogel & Noot importer from Arad, Romania, is also included in this acquirement.
As soon as possible, Beyne will resume sales of Premium Parts spare parts, as well as all the other parts of Vogel & Noot machines. The extensive range of sprayers which Beyne produces in Belgium will now be distributed in Romania via AGROROM. Beyne is hereby strengthening its presence on the Eastern European market and commences this expansion with great confidence.
Interview with Stefan Weileder &Alexander Isola of Graf & Pitkowitz Rechtsanwälte GmbH:
Please tell me about your involvement in the deal?
Graf & Pitkowitz, represented by Alexander Isola and Stefan Weileder, have been appointed insolvency administrators in the insolvency proceedings of Vogel & Noot Landmaschinen GmbH & Co KG. Initially, the insolvency proceedings were opened as restructuring proceedings but had to be changed into bankruptcy proceedings due to the absence of sufficient financing. Due to the lack of sufficient financing, we immediately had to initiate a structured sale procedure which had to be completed by the end of September 2016.
Why is this a good deal for all involved?
The Vogel & Noot Landmaschinen GmbH & Co KG group had more than 400 employees. Moreover, the brand ‘Vogel & Noot’ has a very high reputation on the market. In the course of the sale process, the essential parts of the company could finally be sold to a consortium of three bidders. Hence, not only a significant number of the jobs in Austria, but also a major part of the jobs in the Hungarian subsidiaries, as well as the brand ‘Vogel & Noot’, could be saved.
What challenges arose? How did you navigate them?
The biggest problems were the lack of sufficient financing for a continued operation since the very start of the proceedings and the de facto stop of the production months before the opening of the insolvency proceedings. To be able to sell the whole business or parts thereof, and to save the brand ‘Vogel & Noot’ whilst maintaining the goodwill, it was necessary to maintain a kind of emergency operation. In the end, the most essential parts of the business and holdings could be sold as “living” companies due to a quick and efficient liquidation process.
The fund Ufenau V German Asset Light, advised by Ufenau Capital Partners, recently held its final closing at the hard cap of EUR 227 million.
In addition to commitments from returning investors which included entrepreneurs that form part of Ufenau’s Industry Partner network, Ufenau V is pleased to have received new commitments from a number of global blue chip investors. Ufenau V was significantly oversubscribed.
Ufenau V will pursue the same successful investment strategy as its predecessor funds, with a focus on applying a systematic Buy-&-Build strategy to majority investments in:
Through a renowned group of experienced Industry Partners (Owners, CEOs, CFOs), Ufenau Capital Partners pursues an active value-adding investment approach at eye-level with entrepreneurs and managers.
Within the next three to five years the fund expects to invest in 10 – 12 majority investments in German-speaking Europe.
The Ufenau Team has grown with the company’s success and now comprises 12 professionals.
AXON Partners, with offices in Switzerland and the UK, acted as exclusive placement agent for the fund.
JD Edwards specialist Beoley Mill Software Ltd was recently acquired for an undisclosed sum by Version 1. The acquisition of Beoley Mill Software Ltd, which is based in Studley, Warwickshire, is the fifth UK acquisition undertaken by Version 1.
Version 1 entered the UK market in 2013. The acquisition of Beoley Mill Software is the fifth in a programme of UK acquisitions the most recent of which saw it acquire the ERP business of London-based Database Service Provider Global Limited trading as DSP. Version 1’s total employee numbers following the acquisition now stand at 900 (300 UK employees) with expected FY2017 revenues of £87M (€100M).
Beoley Mill Software Ltd will continue to trade as Beoley Mill Software Ltd. Company co-founder Stuart Rimmer will step down from his role as CEO and will leave the business to pursue other interests. Beoley Mill Software Ltd co-founder and Managing Director Helen Rimmer has been appointed to the Version 1 Management team and will continue to look after customer relationships and business development of the JDE Practice in addition to helping oversee the successful integration of the two companies.
Thunderhead recently announced that its Smart Communications division, the leading cloud solution for customer and business communications, has been acquired by leading private equity firm Accel-KKR. This will enable Thunderhead to focus exclusively on its pioneering cloud technology for the rapidly growing customer engagement market, the ONE Engagement Hub.
Since launching in 2004, the British privately-owned software company built its Smart Communications division from an innovative start up to a recognised category leader.
Thunderhead’s pioneering cloud solutions paved the way for a new era of customer and business communications. Smart Communications will now operate as an independent entity, led by the existing management team and backed by Accel-KKR.
Thunderhead will continue under the leadership of CEO and founder Glen Manchester, concentrating on its ONE Engagement Hub solution, a transformational new technology for customer engagement.
Launched in 2014, the ONE Engagement Hub is a quick-to-deploy SaaS solution designed to discover customer insight in real-time, across every interaction throughout the entire customer journey. ONE then uses that insight to help brands deliver personalised, relevant, and consistent conversations across every touchpoint, providing a completely seamless experience throughout each unique customer journey.
For Thunderhead, EY led the transaction with Slaughter and May advising on legal aspects of the deal.
