Hat-trick of magic circle firms lead on Arsenal takeover bid

As the Premier League, the top level of English soccer, prepares to start its 2018-19 season this weekend, three of the country’s largest law firms are advising on a deal that will result in a new ownership structure for one of its most historic football clubs.

Clifford Chance, Freshfields Bruckhaus Deringer and Slaughter and May have snagged lead roles on a transaction announced Tuesday that will see U.S. real estate billionaire E. Stanley Kroenke take full control of Arsenal FC after acquiring a 30 percent stake in the team he didn’t already own from Russian oligarch Alisher Usmanov.

Kroenke’s roughly $781.1 million offer for Usmanov’s stake officially ends a long-running dispute between both men for control of the club. Kroenke, who controls 67 percent of Arsenal through his Denver-based Kroenke Sports & Entertainment, first bought a 10 percent stake in the club more than a decade ago. In 2011, Kroenke turned to Clifford Chance corporate partner Tim Lewis in London to advise on an ill-fated bid to take control of Arsenal from Usmanov.

Clifford Chance and Lewis, who joined the Magic Circle firm in 2010 from fellow British firm Macfarlanes, are once again counseling Kroenke on his latest effort to acquire full control of the franchise. Lewis is working alongside Clifford Chance M&A partner Katherine Moir, who also previously advised Kroenke on his ultimately unsuccessful full takeover bid seven years ago.

Slaughter and May is advising Arsenal’s independent directors through corporate partners Andrew Jolly and Paul Mudie. The firm has enjoyed a longstanding relationship with the London-based club, which plays its games at the nearly 60,000-seat Emirates Stadium.

Meanwhile, Freshfields is fielding a lineup for Usmanov’s Red and White Securities company led by M&A heavyweight Julian Long, who in 2014 was also tapped to serve as the Magic Circle firm’s London managing partner.

The offer document for Arsenal states that the proposed deal “will result in the opening of a new chapter in the history of the club in bringing 100 percent private ownership,” which will “bring the benefits of a single owner better able to move quickly in furtherance of the club’s strategy and ambitions.”

In 2011, Linklaters acted for former Arsenal shareholder Lady Nina Bracewell-Smith on the sale of her 15.9 percent stake to Kroenke with a team led by former London-based corporate partner Ian Bagshaw, now of White & Case. That deal led to Bracewell-Smith filing an £11 million professional negligence claim last year against Linklaters and accounting giant Deloitte.

The litigation alleges that errors made by Linklaters played a part in Bracewell-Smith deciding to sell her shares to Kroenke, who has been pilloried by Arsenal fans long opposed to his ownership of the club. Bracewell-Smith’s claims that Linklaters and Deloitte both made errors that allegedly exposed her to capital gains tax liabilities and that she “would not have sold her Arsenal shares to [Kroenke] but rather would have sold them to Alisher Usmanov” had the professional advice she received been different.

In July, Deloitte stepped down as Linklaters’ auditor due to complications presented by the ongoing litigation. That led to the firm’s recent 2017-18 financial results, announced in mid-July, being delayed by just over a week due to the transfer of auditing duties from Deloitte to PricewaterhouseCoopers.

While the Premier League often generates lofty billables for firms across the pond, in the U.S., soccer is increasingly providing opportunities for Big Law. Kroenke, who in 2016 turned to Dentons to advise on the relocation of the National Football League’s St. Louis Rams to Los Angeles, also owns the National Basketball Association’s Denver Nuggets, the National Hockey League’s Colorado Avalanche, the National Lacrosse League’s Colorado Mammoth and Major League Soccer’s Colorado Rapids. (The American Lawyer reported in January on the Rapids hiring former Baker McKenzie associate Ena Patel as their new director of player personnel.)


Slaughters and Linklaters lead on Takeda’s £43bn takeover

Slaughter and May and Linklaters are advising as Japan’s Takeda ups its bid for Irish drug company Shire, with an offer valuing the company at around £43bn.

Takeda presented Shire with a new offer worth about £47 per share, after its third attempt – worth £46.50 per share – was rejected on 19 April, when Shire said the bid undervalued its growth prospects.

Linklaters is advising Takeda on its attempt to takeover the company, with a team led by global corporate chair Matthew Middleditch in London, alongside corporate partners James Inglis, Aisling Zarraga and Sarah Flaherty. Global head of US, Tom Shropshire, and Japan corporate partner Hiroya Yamazaki are also advising.

Slaughters is acting for regular client Shire, with City corporate partners Martin Hattrell and Christian Boney at the helm.

The firm previously took the lead for Shire alongside Ropes & Gray when it made an unsolicited $30bn (£19.2bn) approach for rival drug company Baxalta in 2015. The companies went on to complete a $32bn merger the following year. Hattrell also advised on that deal, working alongside fellow corporate partner Adam Eastell, who joined tech company Eigen as GC last year.

Hattrell previously represented Shire in its 2015 acquisition of US company NPS Pharmaceuticals for $5.2bn (£3.34bn) and in 2014, when it was the subject of an attempted takeover by US drugmaker AbbVie in June 2014.

Takeda has previously used firms including Cleary Gottlieb Steen & Hamilton in addition to Linklaters. Last year, Cleary advised the pharmaceutical company on its $5.2bn acquisition of US-based rare cancer drugmaker Ariad Pharmaceuticals. Ariad was represented by Paul Weiss Rifkind Wharton & Garrison.