Understand Your Rights. Solve Your Legal Problems
Founded in Portland in 2017, Variant is an SEC-registered, employee-controlled alternative credit specialist and interval fund manager with more than $2.3 billion under management, largely for registered investment advisor clients. Variant’s strategies are focused on uncorrelated income-generating private investments in niche markets and are offered to investors through institutional closed-end interval funds.
Kudu is a New York-based provider of permanent capital solutions to independent asset and wealth managers around the globe. Founded in 2015, as of 30 November 2022 the firm has investments in asset and wealth managers located across the US, UK, Canada and Australia. Kudu-affiliated asset and wealth managers now collectively hold approximately $66 billion worth of investments in traditional and alternative market segments and strategies. Kudu provides long-term capital solutions, including management buyouts, acquisition and growth finance, generational ownership transfers and liquidity for legacy partners.
Seward & Kissel advised Kudu with a team led by counsel Danielle Lemberg and including partner Anne Patin, counsels Lancelot King and Michael O’Brien, and associates Jeffrey Dorman, Stephen Marks, Elyse Moy, Brett Cotler and Seth Kuntz.
Dow Schofield Watts Transaction Services LLP provided financial advice.
Founded in Cambridge in 2017, Fidus provides advanced penetration services to help firms assess and improve their IT security. Fidus works with hundreds of organisations worldwide in both the private and public sectors.
Kurtis Baron, founder and managing director at Fidus, hailed the merger. “The acquisition of Fidus Information Security by Wavenet represents an exciting time for us; Wavenet’s passion and dedication to invest in cyber security will enable us to extend our reach into new markets,” Baron said in a statement. “Together, we will continue to grow our existing cybersecurity offerings and guide organisations in every aspect of their IT security systems. I am immensely enthusiastic about this acquisition, and what the future will offer to our customers and our staff.”
Cazals Manzo Pichot Saint Quentin also advised the sellers. L-GAM was advised by Shearman & Sterling, while BPI was advised by BDGS Associés and exiting fund Cathay Capital by De Pardieu Broccas MAffei.
Biose Industrie is a world leader in the development and production of live biotherapeutic products (LBPs). Founded in 1951 and taken over in 2007 by the Desjonsquères family, Biose industrie has experienced growth since 2017 in line with the evolution of a rapidly expanding market, supporting biotechs and pharmaceutical companies investing to bring out a new category of microbiotic drugs.
In acquiring joint control of the firm, L-GAM and the French State through the French Tech Souveraineté will support the group in a new phase of its development.
On completion of the transaction, which remains subject to all applicable regulatory authorisations, French Tech Souveraineté and L-GAM will become shareholders alongside Adrien Nivoliez, the future President of Biose Industrie, other Biose managers, the Fonds Souverain Auvergne-Rhône-Alpes (managed by Siparex) and the Desjonquères family.
The Rossi Bordes & Associés team was led by Maître France Portmann, co-head of the firm’s corporate law department, with the assistance of associate Pauline Thuet.
The acquisition – which was completed on 23 February – includes all of ST’s vessels both current and under construction, growing Herman Senior’s fleet from eight to 12 total vessels. The combined company will serve customers across South America, Europe and Asia, with a newly expanded presence in the broader maritime industry.
Herman Senior commercial manager and co-owner Erwin van Dodewaard spoke positively about the acquisition. “We are proud to have been given the opportunity to acquire ST Marine Support by owners Vasco Tammes and Rienk Switijnk,” he said in a statement. “Knowing each other quite well, we got into informal talks about 13 months ago, over a beer. Vasco and Rienk have built a great company over the years with three robust and strong Multi Cat workboats that operate at the top of their market segments, especially in Dredging. They and their team have a lot of experience and their clear, no-nonsense way of handling projects aligns neatly with our own way of working.”
ST Marine Support co-owner Vasco Tammes also lauded the deal: “Our companies are quite alike in scope and attitude. So, with this agreement we know that two beautiful, carefully built, specialist companies become one greater entity; and in good hands. We wish Herman Senior and the Van Dodewaard family all the best and safe voyages!”
Broadhurst is managed by New Century Holdings (NCH Capital), a US-based investment group established in 1993 with a focus on CEE agribusiness investments. The Broadhurst investment fund has held and developed Vel Pitar for 20 years. Active in the Romanian bakery and cereals sector, Vel Pitar supplies goods from its 10 nationwide factories to over 7,000 stores on a daily basis.
Bimbo is a Mexico-based international bakery group with around 140,000 employees. The group posted revenue of $17.1 billion in 2021.
D&B David și Baias managing partner Sorin David provided assistance to Broadhurst in the negotiation and signing of the transaction, as well as on aspects related to the closing of the sale process. “I would like to thank Broadhurst representatives for the trust they have granted me to assist them in a very important transaction both for the American investment fund and for the Romanian market,” Sorin David said in a statement on the acquisition.
“The sale of Vel Pitar marks the entry of a strong player on the local market, but also the transition to a new stage of development of the company, after being taken over by one of the largest bakery groups in the world.”
Veil Jourde and lawyer Djalil Gangate also advised the Réunion Region and SEMATRA, while White & Case advised Air Austral.
The mixed commercial court of Saint-Denis in Réunion approved the conciliation protocol on 25 January 2023. The protocol set the terms of Air Austral’s restructuring under the aegis of the CIRI. This represents a new chapter for Air Austral, which reported a turnover of €236 million in 2022 and employed around 900 people in Réunion, in addition to supporting nearly 3,000 indirect jobs.
Fréget Glaser & Associés advised the Réunion region and SEMATRA on matters of public law, privatisation, competition law and state aid with a team led by partners Emmanuel Glaser, Sandrine Perrotet and Liliana Eskenazi.
Lawyer Monthly had the pleasure of speaking with Emmanuel Glaser, Fréget Glaser & Associés:
Air Austral started encountering difficulties with the COVID-19 pandemic in 2020. As the crisis persisted, these difficulties became very serious in 2021 and 2022 and it became necessary for Air Austral to seek new financing and open its capital. Also, the region wanted to reduce its participation in the company to below the majority threshold. Several options were considered, including a merger with another airline, Corsair, but none of these options panned out.
In the summer of 2022, a group of Réunion investors – in a clear sign of the importance of Air Austral for the people and the businesses of the Region – made an offer to acquire 55% of the company through an ad hoc company, Run Air, and negotiations started on this basis, under the CIRI’s aegis. We advised the region and the Sematra on this operation from the fall of 2021. We advised on all aspects pertaining to public law, privatisation law, merger control and state aid. Our Veil Jourde colleagues handled the corporate and restructuring aspects and we had the assistance of a Réunion lawyer, Djalil Gangate.
This operation was particularly complex due to the different legal aspects, including administrative, competition, state aid, corporate and restructuring law, that had to be taken into account. Also, numerous authorisations were needed: the European Commission as the operation implied important state aid; the Privatisation Commission as the majority of the capital of Air Austral, which was initially owned through Sematra by public authorities (principally the Réunion region) was to be transferred to private owners, and the French Competition Authority.
The Réunion region also had specific interests that needed to be taken into account and preserved: it had created Air Austral in 1990 and had accompanied the growth of the company from that time, through good and bad, investing important funds into supporting it. But, at this point, the region wanted to reduce its exposure and transfer the majority of the capital to private owners. At the same time, because of the importance of Air Austral for the local economy in terms of activity, jobs and territorial continuity with France’s metropolitan territory, it could not simply relinquish that control and wanted to be able to keep an eye on things.
Also, there was a very strong time constraint because the extremely difficult financial situation of Air Austral at the end of 2022 and the beginning of 2023 made it imperative that we obtain all these authorisations and finalise the operation by the end of January. This was made possible through very good coordination of the processes before each of these authorities.
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Our firm is built on the belief in the strong complementarity between public economic law and private competition law. We combine a unique expertise in the legal frame applying to economic intervention of public authorities (especially in the context of a privatisation process), of merger control procedures and of European state aid regulation.
This was especially important for an operation in which the seller was a local authority with specific constraints.
The loan was used for the refinancing of the issuer’s debt related to the operation of the Smart Park, the largest outdoor shopping mall in Greece, and the purchase by Reds of the former US base in Gournes, Heraklion Crete, via an e-auction conducted by the Hellenic Republic Asset Development Fund.
Reds emerged as the highest bidder with an offer of €42 million and acquired the property, which comprises a seaside area of 345,567 sq.m., is located 13km from the Nikos Kazantzakis International Airport and 16 km from the city of Heraklion. The company has stated its intention to use the land for tourism and commercial development.
Koutalidis advised the National Bank of Greece with a team led by partner Effie Papoutsi.
Lawyer Monthly had the pleasure to speak with Effie Papoutsi at Koutalidis to give us some further insight into this transaction:
Our firm advised NBG as subscriber, bondholder agent and hedging provider for this issuance. In addition to drafting all loan and security documentation and supporting the bank during the negotiation process, our role involved working closely with the borrower’s and the bank’s teams to ensure conditions were met and closing achieved on time, while also assuming a project management role.
Lenders, and especially systemic banks, place great importance on obtaining all necessary and appropriate protections when making such an investment and ensuring that the finance agreements and security package protect their interests to the highest degree. This has always served as the basis for our work in all the deals we are involved in.
It is important, however, to never lose track of the purpose served by a loan and the business needs and concerns of all parties involved directly and indirectly in the project, as they may affect timing, documentation and virtually all aspects of our work.
Lawyers tend to focus on the legal points and underestimate how the needs of third parties, such as lenders being refinanced or the seller of an asset, may impact the process or how drafting may impact the business aspects of a deal. Experienced lawyers would also agree that in long-term project financings it is important to help parties strike the right balance between their respective needs so that the project runs efficiently and without unnecessary friction and delays post-closing.
Ultimately, our work is to help parties bring their project to life in the way they intended, while ensuring that our clients’ interests are safeguarded.
Our firm supported NBG for all aspects of the issuance, including drafting of documentation, customary due diligence and supporting the bank throughout a staged closing process. The dual purpose of the loan, namely the refinancing of existing project financing provided for the issuer’s operation of the Smart Park mall and financing the acquisition by Reds of a landmark real estate asset from the HRADF, meant that the documentation and structure planning had to combine all necessary covenants for essentially two financings. This required a lot of careful drafting, negotiation and coordination on multiple fronts.
Ultimately, our work is to help parties bring their project to life in the way they intended.
Furthermore, everyone was conscious that the issue marked the successful completion of a long awaited privatisation process with special significance for the Greek economy. With this in mind, our team worked hard to ensure essentially two smooth closings in a continuously evolving process.
In my view, this was one of those complicated financings where the value of a big and experienced team is evident. This applies to commercial and legal teams alike. It would have been impossible to achieve such a smooth result without the professionalism and positive attitude of everyone involved. Another important factor was that we have been advising National Bank of Greece for decades for various types of financings and other deals, which made possible the close and efficient cooperation necessary for this deal to close successfully.
Over the last decades, our firm has advised on most of the high-profile and groundbreaking transactions in Greece and has the privilege to serve a great variety of clients including leading Greek and foreign corporations, multinational enterprises, major investment and commercial banks and financial institutions.
I firmly believe that lawyers must always remember their clients’ bottom line and our firm is well-known for its business approach. When engaging a tier 1 firm, clients take legal expertise for granted, as they should, but our firm (and our Banking and Finance Department in particular) offers clients the added value of decades of experience in complex and landmark transactions involving privatisations and project financing. I am happy to have headed a committed team that succeeded in delivering within very ambitious time and other constraints.
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The main focus is naturally on the acquisition of the Gournes land area by a private company that has ambitious plans for its development. Crete is already a top tourist destination but there is still a lot of room for investment and a more diverse exploitation of what it offers. The plots acquired are by the seaside and the plans made public by REDS so far provide for the construction theme and retail park as well as a mixed tourist resort with hotels, branded freehold villas and a casino. It is everyone’s hope and expectation that this will lead to further economic development and the creation of new jobs in the area.
Castor & Pollux is a digital communications consulting group that assists clients in designing and implementing their brand strategy. The firm has developed its offering significantly since its founding in 2010, with organic growth and significant contracts having allow it to diversify its offer around new entities such as a production studio and an expert placement agency. The firm now advises larger French firms as well as SMEs with its team of around 65 employees.
With over €5 billion in assets under management, Omnes is a major player in private equity and infrastructure, providing companies with the necessary equity for expansion and development. Its joint operation with Castor & Pollux will be structured through mezzanine financing and a capital injection that will allow its management team to become the company’s first group of shareholders.
DDA & Co advised Castor & Pollux with a team consisting of partner Alain Sitbon and associate Florian Charrière. Castor & Pollux also appointed legal firm Ollyns and Cabinet Paoluzzo.
Lawyer Monthly had the pleasure to speak with Alain Sitbon at DDA & Co to give us some further insight into this transaction:
DDA & Company was engaged as financial advisors to the Castor & Pollux founders, representing around 80% of the company’s equity. Together, the two founders wanted to exit the business and move on to new entrepreneurial projects. Luckily, they had anticipated this move a few of years ahead and had set up a solid management team.
DDA’s role was then to embrace everyone’s objectives, including the founders, the managers and the rest of the team (65 professionals) within Castor & Pollux and to organise the smoothest possible transaction, keeping C&P’s DNA and development dynamics intact.
People, people and people! Communication agencies are a ’people business‘, probably more so than in most other industries. Therefore, it is crucial to pick up and accommodate everyone’s aspirations, not only those of the main shareholders. This requires careful attention and a good understanding of the management who will continue the company’s journey. The sellers must agree with that. That was the case at Castor & Pollux.
The transaction was structured as a management buyout, which all parties ultimately chose over a sale to an external trade buyer – which would have been a larger corporation in the communication business. Such a transaction includes many legal issues in connection with the financing, shareholders’ agreement, governance, exit horizon etc.
Communication agencies are a ’people business‘, probably more so than in most other industries.
Such a process requires a number of legal advisors in consideration of the number of parties involved who need representation: lenders, PE fund, management team and founders. It is the financial advisor’s role to coordinate this closing process, stay focused and keep the momentum so that the deal closes without missing anything.
We are very proud that we made this MBO possible. In our first meetings, this option was initially not considered either by the founders or by the management team. The reason was a lack of knowledge of this kind of operation and a strong fear of any operation that would involve a private equity partner.
We provided guidance and education so as to mitigate the fears of both the founders and the management team towards this kind of deal. That was our first success, but only the beginning of the transaction journey. We then had to look for the right partner, not only in connection with the financial structure of the deal, but especially to fit with the team’s DNA.
We hope this operation can serve as a testament to illustrate how founders in consulting firms, communication agencies and any other people business can work in order to organise the transmission of their company to their employees. They need to understand that such transactions do not adversely affect the value of their company and can also guarantee its sustainability.
Every operation has its specific challenges. There is no simple operation and this one was no exception. I will not give specific examples, but as a financial advisor I can say that the more you prepare such an operation at the beginning, and the more you talk with all parties involved within the company to clearly understand their objectives, the more successful the process will be.
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Absolutely! This operation is very revealing of DDA’s know-how – on the one hand because it involved an independent SME in the communication sector, on the other hand because we had the opportunity to present to the shareholders and to all parties implied options they had not considered. Shareholders and managers were all very responsive to our various presentations and initiatives. This allowed us to enter into a real partnership with them whose objective was to ensure the best operation for all. I definitely can say we achieved that objective.
Alex Dick, Managing Director at Alexander Lyons Solutions, suggests below that greater flexibility among firms will create a more attractive environment for top talent to work at their best.
2022 has officially bitten the dust, and there will be plenty working in the legal sector who will consider this to be a cause for celebration. After all, the last few years have been undeniably tough for the industry, particularly when it comes to hiring. While the pandemic caused the demand for legal services to soar, a mass exodus of talent from the sector resulted in widespread shortages of permanent staff, placing incredible pressure on workloads.
Although the situation with COVID-19 is now considerably healthier than it was a year or two ago, traditional law firms continue to face an existential crisis. Many lawyers are deciding to move away from the traditional firms they were working for and towards those operating a legal consultancy model. This is corroborated by research by Arden Partners, showing that the number of consultant lawyers in the UK is rising at a compound annual growth rate [CAGR] of 21%, while mid-market law firms are growing by only 7%.
As such, it is evident that traditional firms are losing out to their consultancy counterparts in the race to recruit.
So, what are legal consultancies offering that traditional firms are not?
Well, since the vast majority of lawyers were forced to swap their usual desk for their dining room table or breakfast bar during the pandemic, working from home has become commonplace within the legal sector, rather than a perk reserved only for the most senior partnership positions.
Despite being bombarded with case work, many lawyers enjoyed the greater work/life balance that working from home afforded them, no longer wasting precious time sitting in traffic while travelling to and from the office, nor having to spend money on the petrol. Whenever they clocked off for the day, workers were already home, ready to make a start on the cooking, cleaning, getting the kids ready for bed, or simply unwinding.
It is evident that traditional firms are losing out to their consultancy counterparts in the race to recruit.
While many traditional firms have reverted back to their pre-pandemic work schedule – namely, to work from the office five days a week – a large number of lawyers are eager to return to a hybrid working routine, sharing their time between the office and home. Given that 96% of consultancies offer some form of agile working according to the MHA, it is no surprise that lawyers are leaving backwards traditional firms for consultancies that better understand the benefits of a happier and healthier workforce.
In this sense, many traditional firms are unwittingly committing self-sabotage by failing to address the preferences of their workers. After all, the shift to WFH that the pandemic imposed coincided with many firms reporting their best periods for billing ever.
Coincidence? Not likely. A recent study by the University of Warwick found that workers who feel satisfied in their roles are, on average, 12% more productive than those who are not. With remote working during the pandemic having proved such a massive hit among legal professionals, offering hybrid working options seems like something of a no-brainer for traditional firms. Unfortunately, this notion is often distorted by the misguided view among seasoned senior partners who think that work carried out at home does not hold the same value as that which is completed in an office setting.
Despite much evidence having dispelled the myth that remote working leads to diminished productivity, many persist in this antiquated belief. Whether they want to acknowledge it or not, times have changed – in my mind, for the better, given how much happier and productive workers have become since adopting a WFH routine. If traditional firms continue to keep their fingers in their ears, they just might find themselves facing extinction before long.
If they mean to go on existing, traditional law firms must now wake up and smell the coffee. Home working has proven to be a huge success, not only for legal professionals who are happier for their newfound flexibility, but also employers, who benefit from more productive workers. Essentially, it is a win-win, and the sooner senior partners ditch their outdated perceptions of remote working, the better for all concerned. After all, how much longer can they ignore the changing landscape around them?
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While the clock is ticking for traditional firms in the sector, they still have time to change their attitude to remote working and, in doing so, give employees the flexibility to decide how, when, and where they want to work.
By taking this action, they can finally begin to turn the tide on the mass migration to legal consultancy, thereby proving to existing and prospective employees exactly how forward-thinking and agile they can be.
Alex Dick, Managing Director
Liberty House, 222 Regent Street, London, W1B 5TR, UK
Tel: +44 02035 514862
Alex DIck is Managing Director at Alexander Lyons Solutions and a legal recruitment specialist with more than a decade of experience. Enshrining flexible working and breaking free from outdated practices, he helps beleaguered and disenfranchised lawyers to find spaces that are right for them.
Alexander Lyons Solutions is a market-leading recruitment firm specialising in legal, HR, sales and marketing and a range of other sectors. Since its founding in 2011, the firm has established itself as a go-to in the UK consultancy market.
There is a quiet revolution taking place amongst law firms – and it could protect firms' operating profits in a challenging year.
And while the change involves technology and automation, it is not found between practitioners and clients. It is not a 'front office' trend.
No, the quiet revolution is occurring behind the scenes.
For years, law firms have modernised, embracing technology to keep pace with change. From time-keeping to document storage and processing, technology has helped the legal profession to become a mobile, adaptable industry. Indeed, the founding father of the so-called Quiet Revolution was a lawyer: Jean Lesage ushered in a period of modernisation and much change in mid-60s Canada from his base in Quebec.
The changes being adopted now, however, are hard to spot. If you are a client, you would not notice. If you are a front-line practitioner – unless in management – you are often unlikely to see it, too.
Yet it is there. Scores of firms are not only revamping their client propositions; many are turning to their operations to seek efficiencies and improvements.
The most important reason for this is to reflect in firms' day-to-day operations the same modernity and pace now experienced in client services. And at no time is this more important than when two different organisations consolidate.
Over the last decade, mergers and acquisitions in the legal sector have been a big trend. Last year, Legal Futures confirmed just how active the market is in a survey of 100 law firms. They found that nearly 50% (47) were considering M&A, and a quarter of this group (23%) were already in talks about a possible deal. Meanwhile, a further 57% of this group were ‘actively’ seeking one.
Scores of firms are not only revamping their client propositions; many are turning to their operations to seek efficiencies and improvements.
Looking ahead, things are only set to pick up pace, with analysts now predicting that M&A activity will surge in the recession as bigger firms look to take advantage of the economic downturn and acquire smaller firms at lower prices. And as consolidations pick up pace, so too will the discreet movement away from the past way of doing things.
There are many reasons why it is important for firms to transform operationally as they consolidate. The situation that Dutch multinational HR service provider Randstad found itself in in 2015 provides a great example.
Randstad merged various units that year and, historically, had always worked with multiple independent systems to order items and services and create invoices, each with its own set-up and process. But with this fragmented system, the organisation ran into problems. There was little control over purchases, and approval of orders often took place after – not before – the receipt of the invoice, resulting in unnecessarily high costs for the business.
So, the business introduced a single ordering and payment process for the entire organisation, meaning employees could directly place their orders in ‘web shops’ of preferred suppliers. Everything became processed within a single application. Authorisation was automatic, and it became easier to gain insight on which suppliers are responsible for the most expenditure.
This great level of transparency and authorisation put a complete stop to maverick spend in the business and gave an up-to-date overview of expenditure and outstanding commitments. Crucially, too, for the staff who were shifting systems, ordering was made easier.
The effects of streamlining processes with technology can be dramatic. This is especially true for firms that are undergoing changes of magnitude. Availability and oversight of data is a rare thing in manual or outmoded finance and operations functions. Yet for years law firms have acted blind.
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Until now, most finance directors in professional services firms would not be able to tell you in real time how much money was leaving their firm and why. In a period of recession, where cost management is paramount, that is a major handicap.
Not all revolutions are overtly disruptive. The quiet ones effect clear change over time. That is exactly what is happening in the legal profession as – at last – operations catch up with client services.
Riverview Court, Castle Gate, Wetherby, Leeds, LS22 6LE, UK
Tel: +44 01937 545070
Ilija Ugrinic is Commercial Solutions Director at Proactis, having joined the company in 2014. Ilija draws upon more than 20 years’ worth of experience in spend control and eProcurement, helping automate and optimise processes for many leading organisations across the public, not-for-profit and private sectors.
Proactis is a leading Source-to-Pay software solution provider for mid-market organisations across a range of service-led industries. Proactis’ end-to-end modular platform enables customers to control spend and manage supply-chain risk; improve compliance and governance of their purchasing activities; reduce the cost of goods and services; and deliver efficiencies, all through process digitisation and automation.
