Lawyers from Linklaters and Slaughter and May found themselves on the sidelines of a courtroom tussle last week as a scheme of arrangement hearing for the merger of engineering giants BTR and Siebe turned into a clash between some disgruntled shareholders and the judge.
Seven of about 100,000 shareholders objected to the merger on grounds of a technicality. But those in court claimed that the motive behind the action was the shareholders felt they were getting a bad deal out of the £7.6bn merger. The shareholders accused BTR of misusing proxy votes, but the court ruled against them on the grounds that the merger was a satisfactory deal.
The legal teams representing BTR and Siebe were split over their interpretation of the events. A source close to Siebe predicted such objections would become more frequent as well-informed shareholders become more active in defending their share in a company, however small that share is. But a lawyer from the BTR side was more cagey saying it "remained to be seen" whether the trend would develop. Both sides did agree, however, that the objection had put the deal back a few days and indeed, been a waste of time.

Angels could spread their wings
The government-led National Business Angels Network was launched last week with Reynolds Porter Chamberlain the only law firm among the sponsors.
The Network aims to bring together growth companies and high net worth individuals. RPC's Ron Norman said Business Angels "fulfil a vital function in supplying long-term equity finance for growth companies in amounts which are too small for conventional venture capital funds". This is true. Small high-tech companies in the UK have long suffered from a lack of interest by banks and existing venture capital funds – whether private or corporate – to provide early stage funding. And the network aims to bridge that gap.
But the experience of companies in Silicon Valley offers some lessons for the UK. Business Angels, who have made their money after leaving the likes of Microsoft, Cisco Systems and Sun Microsystems meet regularly to vet the latest business ideas.
Often they buy into an idea and, hey presto, here comes the next Geocities, (recently bought by Yahoo for £3.1bn). But Valley insiders report that discontent is growing as the power of Business Angels grows.
While investing is a business for traditional venture capitalists, the charge against Business Angels is that they treat their investments like a hobby. And unlike VC's they go on holiday. UK advisers to small high-tech companies – and lawyers play an important role here – need to be aware of the lessons from the US before delivering clients into the hands of Business Angels.

Mallesons' glowing report
The rationale behind Clifford Chance's interest in Australia's Mallesons Stephen Jaques (revealed in Legal Week) has had another boost. A survey by Corporate Adviser Securities Data puts Mallesons in the top spot for M&A – 114 deals worth a total of almost a$17bn.
This represents 38% of 1998′s deals. Clayton Utz, Freehill Hollingdale & Page and the Allens Arthur Robinson Group were all involved in about a third of 1998′s deals. Also note the importance of cross-border deals – 43% of all M&A deals were cross-border – to the large Australian firms. Even more reason, perhaps, to offer clients a one-stop international law service.