Covington, Skadden, Clifford Chance and Pinsents pick up roles on AA IPO
A quartet of law firms have landed mandates on roadside recovery group AA's accelerated initial public offering on the London Stock Exchange.
June 09, 2014 at 07:13 PM
3 minute read
A quartet of law firms have landed mandates on roadside recovery group AA's accelerated initial public offering (IPO) on the London Stock Exchange.
Covington & Burling, Skadden Arps Slate Meagher & Flom, Clifford Chance (CC) and Pinsent Masons have all been appointed to advise on the listing, which has priced the company's equity at £1.4bn. The AA also has debts of around £3bn.
AA parent company Acromas – a partnership between private equity groups CVC, Permira and Charterhouse – announced its intention to float the roadside recovery business on Friday (6 June).
The deal sees a management buy-in by AA executive chairman Bob Mackenzie, alongside institutional investors including Aviva, Blackrock, Henderson Global, Invesco, L&G and Lansdowne Partners. Acromas will retain a 31% stake in the business, according to listing documents.
Cenkos Securities, the sole co-ordinator and bookrunner for the deal, turned to Covington corporate partner Paul Claydon, who worked alongside partners Simon Amies and Natalie Walter on English law matters, Charlotte Hill on regulatory matters and tax of counsel Guy Dingley.
London-based partner Kristian Wiggert also advised Cenkos on US securities law issues. "The US piece was important but relatively straightforward," Claydon told Legal Week. "We needed to be compliant with US securities law, though there was no offering to US investors."
Claydon said that while several IPOs had underwhelmed in London in recent weeks, there remains a strong appetite for equity capital markets among investors.
"There are a few more major deals in the pipeline, and we're still doing public financing work and mid-market sized deals," he added.
"With some of the larger IPOs, maybe there were indigestion issues which had an impact on pricing and trading, but there doesn't seem to be any sign of a let-up."
CC acted for the AA and selling shareholders, with corporate partner David Pearson leading a team alongside capital markets senior associate Tony Lally.
Skadden capital markets partner Danny Tricot took the lead for financial adviser Greenhill & Co, alongside corporate partner and English law head Michael Hatchard, who came to the instruction through Greenhill's chairman James Lupton.
Pinsent Masons corporate partner Rob Hutchings also acted on the deal, advising AA management on executive benefits and compensation matters.
The listing is the second major flotation by Acromas this year, following its public share sale of over-50s holiday company and insurer Saga.
For that mandate, which valued the company at £2.2bn, Acromas and Saga turned to Freshfields Bruckhaus Deringer corporate partner Chris Mort.
That deal was something of a coup for Freshfields, given CC's role as main advisor to Acromas partners Permira and CVC on the £6.15bn merger between the AA and Saga at the height of the buyout boom in 2007.
For the merger, CC fielded a team led by James Baird, who has since retired, and Kem Ihenacho, who is departing the magic circle firm for Latham & Watkins.
Last July, a Freshfields team led by structured finance partner Marcus MacKenzie advised a consortium of banks on the £3bn refinancing of the AA, which allowed the client to partially pay for the debt it took on when it merged with Saga.
The financing also saw CC take the lead role for Acromas sponsors Charterhouse, Permira and CVC Capital Partners, with Pearson advising the group alongside capital markets partner Steve Curtis, banking partner Roderick McGillivray and tax partner Dan Neidle.
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