The Multi-Billion Dollar Deals That Made 2019
By overall deal amounts, 2019 was a bit of a down year when it came to M&A work. But that doesn't mean there weren't some massive and influential deals over the course of the year—or that leading M&A practices didn't find plenty to keep them busy.
December 22, 2019 at 08:00 PM
7 minute read
The original version of this story was published on The American Lawyer
By overall deal amount and number of deals, 2019 was a bit of a down year when it came to M&A work. According to league tables compiled by data research firm Refinitiv, overall M&A performance was down year over year from 2018, with the first nine months showing a worldwide 10% drop in deal value. The number of worldwide deals was also down 10% compared to 2018, although the number of deals in the Americas was up 17%.
Wachtell, Lipton, Rosen & Katz continued its yearlong hold on highest deal value as of the end of the third fiscal quarter with $522 billion in deals, according to Refinitiv. That represents a sizable lead over second place Kirkland & Ellis, which brokered $462 billion through the first three quarters of 2019. Rounding out the top five firms in terms of global deal value were Davis Polk & Wardwell, Simpson Thacher & Bartlett and Sullivan & Cromwell, which knocked Skadden, Arps, Slate, Meagher & Flom from the top five at the end of Q3.
But just because 2019 isn't quite on par with 2018 doesn't mean there weren't some massive and influential deals over the course of the year—or that leading M&A practices didn't find plenty to keep them busy.
White & Case finally took the petrol giant public after several false starts and some intense back and forth on valuations. Latham & Watkins advised the joint financial advisers, coordinators, book-runners and underwriters on the deal. The $25.6 billion IPO, which represents about 1.5% of the available company shares, broke the record for largest initial public offering formerly held by Chinese company Alibaba, which had a $25 billion IPO in 2014. After the offering, Aramco's valuation hit $1.877 trillion, short of the $2 trillion the company's leadership was hoping for, but still enough to make it the most valuable company in the world.
Simpson Thacher & Bartlett and Freshfields Bruckhaus Deringer had the lead roles on Chinese technology giant Alibaba Group Holding Ltd.'s secondary listing in Hong Kong this year. The New York-listed company raised about $11.3 billion, making it the second-largest listing globally after Saudi Aramco. The company's IPO in 2014 set a record at the time of $25 billion. Alibaba's Hong Kong listing was originally planned for August but the company postponed it due to poor market conditions and the anti-government protests in Hong Kong. It finally took place in November.
Shearman & Sterling (Raytheon) and Wachtell (United Technologies Corp.) advised these two government contracting giants as they had a "merger of equals" in creating a $100 billion leviathan. The deal came under question by the president, but neither company seemed too concerned. The CEOs of Raytheon and UTC met with the president, and as of now the deal is on, changing the dynamic of how U.S. defense contractors can compete on the global stage.
Wachtell and Cravath, Swaine & Moore took charge in one of the largest pharma deals of the year. Mylan N.V. combined with the generic drug arm of Pfizer, called Upjohn, to create a $48 billion industry giant. Both companies had been taking hits to sales since some of their name-brand drugs went off patent and the emergence of generic manufacturers in India drove product costs down. Both Wachtell and Cravath have long-standing relationships with their respective clients.
Multiple firms in the U.S. and U.K. were needed to create the "British Bloomberg" as the LSE purchased U.S.-based data firm Refinitiv for $27 billion. Freshfields Bruckhaus Deringer represented the LSE while Refinitiv, co-owned at the time by Thompson Reuters and Blackstone Group, turned to Simpson Thacher, Wachtell and Magic Circle firm Allen & Overy for their end. The deal continued to make headlines after it was announced, as the Hong Kong Stock Exchange made an unsolicited $36 billion bid to purchase the LSE and kill the Refinitiv deal. In a strongly worded letter, the LSE said, in no uncertain terms, "no."
Debevoise & Plimpton, Weil, Gotshal & Manges, Cleary, Gottlieb, Steen & Hamilton and Skadden, Arps, Meagher, Slate & Flom all got some playing time during International Flavors and Fragrances' $26.2 billion merger with DuPont's nutrition and biosciences business, in the process creating a $45 billion giant. Cleary guided long-term client IFF, Skadden helped DuPont while Debevoise and Weil worked with the financial advisers and helped secure financing. The deal created a new major player in the international food and fragrances arena.
Another $26 billion deal, but this one took place in the banking sector. Davis Polk represented bank and brokerage firm Charles Schwab as it acquired competitor TD Ameritrade in an all-stock transaction. Omaha-based Ameritrade was represented by global M&A deal revenue leader Wachtell. The combination was thought to catch the attention of federal antitrust regulators, experts said, as the new company's primary peer competitor, E-Trade, manages only about $500 billion in assets. The new Schwab/TD entity will manage roughly $5 trillion.
Skadden advised LVMH Moet Hennessy Louis Vuitton, and Sullivan & Cromwell advised Tiffany & Co. as the French luxury goods goliath purchased the iconic U.S. jeweler for a record $16.2 billion. It was the largest deal in the luxury goods sector's history. Fried, Frank, Harris, Shriver & Jacobson worked with LVMH's financial adviser Goldman Sachs, and Allen & Overy advised the banks on obtaining loans for the deal. Tiffany & Co. had been in some financial trouble prior to some recent expansion into China and a rededicated focus on younger buyers, which seems to have righted the ship.
Sullivan & Cromwell advised Swiss pharmaceutical company Norvartis in its acquisition of Inclisirin manufacturer The Medicines Co. for $9.7 billion. Paul, Weiss, Rifkind, Wharton & Garrison represented New Jersey-based Medicines Co. Inclisirin, a cholesterol-lowering drug that the industry thinks has great potential, was the primary driver behind the deal, and Novartis paid a premium to acquire it. The Swiss company paid $85 a share for Medicines Co., well above the predeal closing price of $68.55.
Paul Weiss and Germany-based Hengeler Mueller represented pet health care company Elanco in its acquisition of the pet health arm of Bayer AG for $7.6 billion. Bayer was represented by Sullivan & Cromwell, PwC Legal and Linklaters. The buy makes Indiana-based Elanco the second largest player in the sector with 13% market share, according to The Wall Street Journal.
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Law Firms Mentioned
- Cravath, Swaine & Moore
- Fried, Frank, Harris, Shriver & Jacobson
- Linklaters
- Simpson Thacher & Bartlett
- Skadden, Arps, Slate, Meagher & Flom LLP
- Davis Polk & Wardwell
- Cleary Gottlieb Steen & Hamilton
- Weil, Gotshal & Manges
- Latham & Watkins
- Paul, Weiss, Rifkind, Warton & Garrison
- White & Case
- Freshfields Bruckhaus Deringer
- Wachtell, Lipton, Rosen & Katz
- Kirkland & Ellis
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