IFLR 1000
The Guide to the World's Leading Financial Law Firms

With soaring commodity prices and strong demand for copper, of which Chile is the world's top producer, the country continued its reign as one of the darling economies of South America. Despite a massive earthquake that rattled the country in February, Chile is on an upswing. "The economy is doing very well, booming really," says one attorney. With robust growth and a very respectable debt-to-GDP ratio, attorneys are justified in their optimism. Market feedback earmarks the mining, fishing, energy, and retail sectors as being particularly active over the past year.

Further cementing the country's economic progress, the Organisation of Economic Cooperation and Development (OECD) accepted Chile as its 31st member in May 2010. The approval was three years in the making, and marked the first time a South American country and second time a Latin American country (after Mexico) has been accepted into the Paris-based forum. Chile's induction can be seen as an ongoing commitment by the Chilean government to continue market-friendly policies promoted by the organisation. This may prove important, as rapid growth can create separate headaches.

With rising domestic demand accompanied by a breakneck growth rate in the first quarter of 2011, the issue moving forward may be whether the economy is at risk of overheating, as the World Bank has suggested. Additionally, inflationary pressures created by higher commodity prices will need to be kept in check by tight monetary policies -something the government has so far sought to confront by aggressively raising interest rates.

The government's "pro-growth agenda", as one attorney calls it, has helped market efficiency. "There is a drive to create more competition in the marketplace," says one attorney. The recently enacted MK3 Law, a capital markets reform measure has made things easier and created more flexibility. It follows earlier reforms that sought to liberalise the country's capital markets. The newest initiative introduced exchange trade funds (ETFs) to the Chilean markets and gives tax breaks to foreign institutional investors.

For a younger firm, Aninat Schwencke & Cía continues to impress with a roster of well-heeled international heavyweights complementing a strong list of local clients. The firm has built a fine private equity practice and last year coordinated local due diligence for Ariba's acquisition of Quadrem, a global tech company with one of the world's largest supply networks. The firm also advised Chile's largest steel company, CAP, in the early repayment of a bond issuance.

Bahamondez Alvarez & Zegers is a mid-sized firm that has started to make a splash in the Chilean legal community. This young firm has started to carve out a niche in venture capital. "They have a good background and should do very well," says one attorney.

The firm is led by Matías Zegers and Felipe Bahamondez, who was called "the mind behind the firm," by one competitor. A team managed by Zegers helped online coupon dealer Groupon acquire several Latin American companies helping to establish the company in South American markets.

Baker & McKenzie moves up the M&A rankings this year. "A good shop with good people," says one attorney. "It's a standard Baker & McKenzie office." The firm's global brand continues to draw business, despite it having a smaller local presence according to some in the market. One competitor says the firm is "doing well" and attributed its success to "receiving clients from their international model".

The multinational practice advised Atlantia on the combined $400 million acquisition of 50% stakes in two concession holders, Sociedad Concesionaria Autopista Vespucio Sur and Sociedad Concesionaria Litoral Central, and a highway maintenance company, Sociedad de Operacion y Logistica Infraestructura (Operalia). Additionally, the firm advised Chilean winery Viña Concha y Toro in its $238 million acquisition of Fetzer Vineyards from Brown-Forman Corp in California.

Barros & Errázuriz was founded in 1988, making it one of the younger firms in the market, but its stable expansion has earned the praise of its peers. One partner marvels at the "remarkable" rate at which the firm has developed. "No one has grown with the speed and consistency that Barros & Errázuriz has grown," he says. Peers commended the firm's progressive business model, with one competitor describing it as "modern" and "forward- thinking".

In May 2010 the firm helped execute a sale of Lan Airlines shares held by Bancard, the credit card giant founded by President Sebastian Piñera. The deal had three phases, an initial purchase by Costa Verde Aeronáutica, followed by a public auction on the Santiago Stock Exchange, and finally a public offer tendered by Bethia group for shares in Axxion. Started after the second round of presidential elections and valued at nearly $1 billion in total, the phased transactions were made necessary by political considerations.

"The tax and M&A practice is world-class," says one client of the firm's top-tier practice. "Pablo Guerrero is the best M&A attorney I work with."

Complementing the firm's robust M&A practice is a strong presence in Chile's banking and finance sector. "They are very strong in investment funds, private and public funds," says a competitor. An example of this was the firm's work for Fondo de Inversión Rentas Inmobiliarias, an investment fund managed by Independencia Administradora de Fondos de Inversion, in the $110 million public placement of new shares on the Santiago Stock Exchange (Bolsa de Comercio de Santiago, Bolsa de Valores).

"The biggest law firm in Chile," is how attorneys describe of one of Chile's finest financial law firms. "Carey y Cía has the lead because of the number of clients," says one attorney. Many sources in the market felt that the firm is not only large, but bursting with talent. "They are a very good firm," says one attorney, adding that they are "very easy to work with".

The firm has been busy negotiating deals on behalf of a roster of prominent banking clients, including well-known names like JPMorgan, Morgan Stanley, HSBC Chile, Codelco and Banco de Chile. Last year a team led by three partners advised HSBC, JPMorgan, and Citibank as underwriters of a $1 billion sovereign bond offering (denominated in US dollars) and a $500 million sovereign bond offering (denominated in Chilean Pesos). The Chilean Peso issuance marked the first Latin American sovereign bond offering to be denominated in a local currency- a government move to bolster the Peso's international standing. The transaction was also the first time Chile tapped the overseas markets since 2004.

Clients report that they consider the firm an authority within the Chilean market. "It is clear that Carey is one of the most important firms in Chile," says one client. "Extremely professional - they were on top of the deal. We are happy and our client is happy."

With more than 80 attorneys, Cariola Díez Pérez-Cotapos & Cía has the resources to handle complex transactions and the institutional breadth to navigate multi-jurisdictional dealings. "They are quite good at what they do," says an attorney. "They are involved in important transactions."

The firm moves up in the banking and finance rankings this year, with an active practice spanning multiple types of transactions. Rodrigo Sepúlveda advised the borrower, Sociedad Concesionaria Autopistas de Antofagasta, and the guarantor, Skanska, in a $256 million credit facility for the financing of a public works concession (Concesión Vial Autopistas de la Región de Antofagasta). The firm also helped with the private placement and offering of notes issued by Geopark Chile under Rule 144A/Reg S a first for a Chilean branch of a foreign company.

In the words of one source, the firm's well-regarded M&A practice has been "very active". The firm represented Coca-Cola when the beverage company sold its 45% stake in Coca-Cola Embonor, a local bottling company to the Vicuña family and a group of financial investors. A team led by Partner Gonzalo Grez represented One Steel as it acquired Moly-Cop, a Canadian producer of grinding balls for the mining industry. The transaction spanned six countries and Cariola performed due diligence of Moly-Cop's Chilean subsidiaries.

Overall, Cariola Díez Pérez-Cotapos & Cía is a well-established market leader, and as one competitor notes, "It is always a nice experience working with them."

"Rock solid in terms of quality and performance," is how one competitor describes Claro y Cia, "A huge firm, the best corporate law firm," he adds.

Market feedback describes the firm's impressive abilities in the banking and finance sector, quality work and an eye for detail. Attorneys at the firm are characterised as "very thorough" by one peer. "They add value to the transaction," he says. "It's fair to say they address all kinds of risk. They will flesh out risk that might not come out with a lack of further analysis."

The firm advised Chile's flag carrier LAN in its merger with TAM, Brazil's largest airline. The merger will create a new airline company, LATAM. The proposed merger follows other airline consolidation in Latin America and would staff nearly 40,000 employees, serve more than 45 million customers, and provide destinations in 23 different countries.

Both Cristóbal Eyzaguirre and José María Eyzaguirre are well-respected figures: "When you think of M&A [at Claro], you think of both of them," says one partner. José María's name also brought forth favourable comments. "I have the best opinion of him and I have a really good relationship with him," says one attorney, while a client adds: "The service they have provided has been outstanding. The commitment from the partner I have been working with, José María Eyzaguirre, has been amazing. He structured the Chilean part of the deal, which was the most complicated. He's an extremely good negotiator."

"Serious, honest, and ethical lawyers" is how one competitor describes Guerrero Olivos Novoa y Errázuriz, which the market describes as having strong institutional links. "Three of the named partners used to be chief legal counsel of the Central bank," says one lawyer, referring to Roberto Guerrero, Carlos Olivos, Hernán, and Felipe Errázuriz.

Sources note that the banking and finance practice had an active year, largely due to this experience. "I know that they are active in terms of IPOs and also active in financing energy projects," says one competitor. "They have the skill necessary to give confidence to the banks that all the legal aspects have been addressed properly." One rival concludes that the firm was "very good for special deals and complicated deals".

Last year, the team advised Swedish construction company Skanska in regard to the sale of its 50% stake in Santiago's Autopista Central, one of the capital's four urban highways. Purchased by Alberta Investment Management Corporation (AIMCo), the transaction was structured as an international private bidding process and involved several parties. Additionally, Guerrero Olivos Novoa y Errázuriz guided Telefonica, a Spanish telecommunications conglomerate, through its restructuring of Chilean investments.

This full-service firm is a distinguished leader in banking and finance and commands a notable presence in the Chilean market. "Morales & Besa is one of the most frequent players in financing transactions," says one competitor. Another source notes, "They are normally involved in interesting deals in the financing area."

The Republic of Chile mandated the firm on two bond issuances, one denominated in US dollars valued at $1 billion and a second denominated in Chilean pesos valued at roughly $500 million. The latter issuance was noteworthy because it was the first time the government had issued a bond denominated in the country's national currency. The firm also helped Empresa Nacional del Petróleo (ENAP) establish a $6 billion-per-year currency cash management and purchase agreement with Banco Santander-Chile.

One rival remarks that Morales & Besa has a "good infrastructure practice". In September 2010, the firm assisted Cintra (Concesiones de Infraestructuras de Transporte de Chile Limitada), a massive private developer of transport infrastructure, with its sale of a toll road concession. Cintra sold a 60% interest in the concession to ISA Interconexion Electrica in a $328 million transaction, which was complicated when February's earthquake damaged the highway after signing .

"Guillermo Morales is a very good lawyer," says one partner – a sentiment repeated by several in the market. "Morales is a very bright, very young attorney," says another.

A smaller and younger firm, Noguera Larrain & Dulanto earns the praise of clients for its proactive style and prompt assistance. "They are very fast," says one client. "They are up-front and tell you how things are done in Chile. They provide me with very helpful information." In the words of another, "I'd recommend them to anyone."

The firm represented private equity firm Riverwood Capital Partners in the complex acquisition of Synapsis, a provider of IT outsourcing services in Latin America, from Enersis. The multi-national transaction spanned much of South America, including Synapsis businesses in Chile, Argentina, Brazil, Colombia and Peru.

Paulo Larrain garners one peer's admiration for his "extensive M&A experience." The same attorney also mentioned that the firm's namesake partner is "getting really good clients in private equity funds, getting a continuous flow of deals."

Philippi Yrarrázaval Pulido & Brunner's work is respected by the market. "The end result is of very high quality," says one lawyer. "It is easier to deal with them, to tackle issues swiftly." Competitors also note the deft skills of Marcello Armas, saying that he "is very nice to work alongside -a very, very good lawyer."

The firm, led by Armas, has a particularly strong banking and finance practice. "A great firm in banking and finance," concludes a peer. The firm has advised some of the world's largest banks over the past year, representing JPMorgan Securities in connection with Celulosa Arauco y Constitución's $400 million bond issuance. Additionally the firm advised Banco Santander-Chile with bonds issued under Swiss law.

Not to be overshadowed, the firm's M&A practice has won the admiration of numerous market players. "A well recognised M&A practice," is how one competitor describes it. In March 2011 the firm was involved with a $633 million sale and purchase agreement between Quiñenco and Royal Dutch Shell. Commentators highlight the distinguished leadership of Juan Francisco Gutiérrez. One describes him as "a strong lawyer with a well organised team."

Competitors drew attention to Prieto y Cía's active presence in the Chilean bond markets, noting that the full-service firm has been busy with "a lot of local bond issuance, and works quite a bit with local investment banks". Another reports that the firm specialises in the competitive Chilean energy markets. "In banking and finance, they are related to energy work done for two or three very good clients," says a source. "It's a traditional, conservative firm. They are good."

This past year, the firm acted as counsel in a $126 million bond issuance, advising placement agents LarrainVial, BBVA, and Santiago's water utility and sewage concessionaire Aguas Andianas, in the deal. In a transaction typical of the firm's cross-border agility, it also guided E-CL in an international bond placement of $400 million, carried out under Rule 144A/Reg S of the US Securities Act.

The firm's M&A practice has had an eventful twelve months, led by a couple of active clients. "They developed recently a much stronger practice," says one attorney. "They have an important client, he's built a retail conglomerate with the help of Prieto." Referring to SMU Group, a firm ran by famed Chilean economist Alvaro Saieh, Prieto helped the group acquire OK market, a convenience store, and Construmart, a do-it-yourself chain store over the past year.

The firm's outstanding service led one competitor to conclude that the firm's "work quality is excellent."

Urenda Rencoret Orrego y Dörr is a well-known brand with a history in the Chilean market dating back to the 1960s. Last year Pablo Bauer Novoa advised Chile's lone oil company, Empresa Nacional de Petroleo, in financing a new plant and also counseled GMAC in the registration of valued securities as the company expands in Chile. Bauer is identified by many in the legal community as the firm's leading transactional and corporate attorney.