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

The banking sector has re-started with a flow of acquisition and LBO financing deals appearing in the market. "I would say last year it was a year for new starts on the acquisition finance side, there'll be new transactions on the French market which shows the market picking up again," says one banking partner. France has been seen as a trusted market for LBO transactions in Europe at the moment, and one lawyer suggests that "it would probably represent more than one-third of all the transactions which have been completed in Europe from the beginning of the year".

When comes to the bank lending, lawyers believe that it is slowly coming back to normal, but it is still difficult to find a syndicate of lenders with an acceptable margin. "Certainly bank lending has been difficult lately," says one partner. As a result, in order to spread the credit risk, the number of syndicate banks acting as lead arrangers has clearly increased since the crisis accelerated. "Before one or two banks took the commitment and then they're syndicating the deal among other banks, but this is no more the case," says one practitioner. "What happens is now you've got all the banks attending the meetings, you don't have one lead arranger; you've something like six or seven even for a small deal."

In light of the current situation, practitioners find that the lending ratio has become more reasonable when compared to the crisis before. Previously, the percentage of bank loans occupied a much larger portion of the financing while equity capital injection is relatively smaller, but at the moment it is no longer the case. "Today, let's say its 50% of bank lending and 50% from the private-equity firms," says one lawyer.

In line with the rest of the Eurozone economies, French banks have been trying to increase their reserve capital in order to comply with the new Basel III requirements. However it seems there is a lot of space in the regulations, which could allow different interpretations towards the Basel III rules, and the problem is believed to be down to its definition, as one partner explains: "What is lending? What falls in the scope of loans? What kind of instrument falls in the scope of loans? I mean today Basel III is subject to a lot of discussions."

Sovereign debt restructuring has also been an active area over the last 12 months; this has seen French practitioners getting involved in advising the European Commission over sovereign debt issues in Island, Greece, and Spain alike.

Allen & Overy's banking reputation "is mainly based on their corporate finance practice", though they also do "a bit of asset finance", according to one peer.

The firm's name is synonymous with bank lending and its strong links with numerous international and domestic banks cause few to question its position at the top of the market.

In line with the market, the firm's acquisition financing work has been active in the last year. One example saw a team led by partner Adrian Mellor advising the arrangers on the financing aspects of an acquisition of Materne-Mont Blanc. The deal was arranged through a "Double Luxco" (acquisition vehicle) structure which has become standardised in mid and large cap transactions.

Mellor also advised Société Générale, Goldman Sachs and a number of Export Credit Agencies (ECAs) on the joint high-yield and bank financing of 66 satellites owned by Irridum.

One of the team's biggest deals last year saw partner Carine Chassol head the team advising France Telecom in relation to a €6 billion syndicated revolving credit facility. It is believed to be the first self-arranged syndicated loan.

In a similar type of transaction, the team again advised Crédit Agricole on the grant of a €3 billion revolving credit facility to Saint-Gobain. The mandate was headed by partner Christophe Jacquemin.

A Paris team, headed by partners Rod Cork, Chassol and Mellor also advised the banks as part of the steering committee, which will manage the restructuring of CMA-CGM, a French container shipping group. Practice head Cork is one of the team's leading lights: "Yes, he's definitely the person to look at for financing at Allen & Overy," says one peer.

"For me, Gide and Linklaters are no doubt, definitely tier-one firms," says one rival. "Gide is definitely a local firm and mainly active in the French market."

Acquisition financing has been the order of the day for Gide Loyrette's banking team in the last year. In the real estate sector, partner Kamel Ben Salah led the team advising the mandated lead arrangers, including HSBC, Deutsche Pfandbrief Bank, and CAICB, on the acquisition financing of the Kléber building by Scor group. The €170 million transaction was closed in June 2011. "Salah is someone who is active in real estate sector in several years," says one rival.

Other mandates involving Salah saw him advise BayernLB, DG Hyp and Berlin Hyp on the €270 million acquisition refinancing of the CB21 tower building transaction, which was closed in September 2010. He then advised HSBC, BNP Paribas, and BECM in relation to the €225 million refinancing of the Crystal Park estate owned by Icade.

The banking team has also been heavily involved in advising arrangers, and its key clients include Natixis, BNP Paribas, CACIB and Société Générale. Partner Eric Cartier-Millon is seen as the leading light in this area and in one highlight he led the team advising the arrangers on the €1 billion refinancing of the existing indebtedness of the Tereos group.

In January 2011 Cartier-Millon also represented a group of arrangers with regard to the €800 million revolving credit facility extended to Eramet. In an ongoing €1.3 billion mandate, Cartier-Millon again led the team advising the private equity fund Eurazeo as the main shareholder on financing the Europcar group. The team also organised a securitisation programme in order to refinance the bridge facility.

Another outstanding mandate saw Cartier-Millon head the team advising borrower Lactalis, the French dairy group, on the acquisition financing of Parmalat, and the refinancing of the French group's existing indebtedness. The transaction was worth €7.5 billion.

One rival says of Cartier-Millon and Salah: "I can confirm they're really excellent lawyers, and they're very good."

The market suggests that White & Case's banking practice "mainly focuses on acquisition finance". With this area of the market very much on the upswing, the firm will be hoping to maintain its impressive run of mandates in this area.

Partners Gilles Peigney and Raphaël Richard are singled out by peers. "He's [Peigney] very senior, but he's really a recognised finance lawyer in the Paris market," says one competitor, while another one adds: "Gilles knows very well the industry, and he knows very well the LBO sector. Also because he's very old in this practice, he almost started to develop the leverage buy-out practice in the Paris market, so he's a very important figure in this market." Richard also came in for personal praise: "He's a younger partner, but he's recognised too," says one peer.

One of the firm's substantial deals saw the team advise mezzanine house ICG on the €160 million debt acquisition financing of the French restaurant chain Courtepaille by Fondations Capital.

Another highlight saw the team advise the arrangers, including Société Générale, BNP Paribas, and HSBC France, in relation to the approximately €207 million acquisition financing of the French chemicals company Novacap by Axa Private Equity from US private equity firm Bain Capital.

2010 also saw the firm advise a number of notable deals, including acting for both underwriters and the buyers. For instance, the team advised Société Générale in relation to the €900 million syndicated term-loan facility and the €600 million bonds loan to Accor Services, in the context of the service division's spin-off from multinational corporation Accor. The division later became Edenred.

On the buy side, the team represented BC Partners on the €600 million LBO acquisition of Spotless, the French cleaning products maker, from Axa Private Equity. The transaction was closed through an innovative "double LuxCo" (acquisition house) structure.

Clifford Chance has been praised by its peers as a firm "with a very good reputation in financing". "They're trying to cover all the areas of financing," says one peer. "They've [got a] more broad and general finance practice. They do acquisition finance, project finance, and structured finance," says another competitor.

One notable deal saw the team led by partner Thierry Arachtingi representing mandated lead arrangers, including BNP Paribas, HSBC, Natixis, and Société Générale, on the €234 million acquisition financing of Groupe B&B Hotels. The transaction was awarded the Private Equity Deal of the Year at the IFLR European Awards in March 2011.

Leading figure Arachtingi at the firm came in for personal praise: "He's the Rod Cork [Allen & Overy partner] of Clifford Chance, and he's very very recognised." While another one agrees: "Yes, he's very good."

In Morocco, partner Mustapha Mourahib led the team advised Attijariwafa Bank to represent the arrangers, including BMCE Banque, CDG Capital and Attijariwafa Bank, in relation to Meditelecom's €400 million refinancing. The team has since announced plans to open an office in the country which will help to secure more mandates.

Arachtingi again led the team representing Crédit Agricole together with other mandated lead arrangers on a €1.6 billion syndicated revolving credit facility for Lagardère.

Another highlight saw a Paris team, headed by partners Gilles Lebreton and Mustapha Mourahib, working alongside colleagues in Monaco, Luxembourg, Morocco and Italy, advising the UK mid-market investor Duke Street on the €35 million acquisition of QCNS Cruise Europe, a distributor specialising in the sale of cruises in Europe.

Norton Rose is "doing a lot of banking work" according to its peers, elsewhere the firm's asset finance work also came in for specific praise as one competitor says: "Norton Rose is highly recognised in asset finance. Other areas of finance don't have the same reputation as asset finance." While another agrees: "The firm is mainly active in asset finance. They're quite visible in that area, but other than that, we don't see them very often."

Last year Christin Ezcutari led the team acted for Société Générale and other lenders in relation to the restructuring of six facilities to CMA CGM by way of a French tax lease for the financing of six container vessels.

In Asia, George Paterson advised Crédit Agricole CIB Hong Kong and Shanghai branches in relation to the financing of two Boeing 737-800 aircraft for subsidiaries of CMB Financial Leasing, each subsidiary was a project company incorporated in Pudong, China.

When comes to Shearman & Sterling's banking practice, observers say that "the firm had a remarkable panel of banking clients, mostly US banks," while another adds that due to the loss of partner Martin Lebeuf who joined French domestic Darrois Villey Maillot Brochier in 2009, the firm was hit hard in terms of its banking team.

Last year, the largest mandate at the firm saw Pierre-Nicolas Ferrand lead the team advising a consortium of banks including, Crédit Suisse, Citigroup, Morgan Stanley, Crédit Agricole CIB and Société Générale in connection with the €1.6 billion acquisition financing of a French frozen food company Picard and a related stand-by bridge facility agreement by Lion Capital.

Another highlight saw the Paris team advising Labco in regards to its €500 million high-yield bond offering and its €135 million revolving credit facility. An ongoing transaction saw Ferrand again involved when he led the team advising Geoxia as debtor in the restructuring of its overall bank liabilities and capital structure. The mandate includes a €200 million high-yield bond offering and a €60 million revolving credit facility.

Herbert Smith's key clients include Deutsche Bank, BNP Paribas and Société Générale. One notable mandate saw the team led by Régis Oréal advising Deutsche Bank London branch in connection with the real estate refinancing of the "Les Mercuriales" towers in Paris. The security package involved a subrogation mechanism, which requires a French loan agreement being out in place to implement the financing agreement governed by English law.

Another ongoing mandate saw Oréal led the team advising BNP Paribas and Ingepar on the tax driven financing of 400 counsel housings in La Réunion to be managed by a housing agency.

Cleary Gottlieb Steen & Hamilton's banking mandates involved corporate loans, acquisition finance as well as reorganisation. One of the firm's peers comments on its banking team by saying: "We've been working on a big transaction with them and they should be ranked there."

One highlight saw Valérie Lemaitre lead the team acting for Vallourec, a French seamless steel tubes producer, in a €1 billion syndicated multi-currency revolving facility arranged by Banc of America Securities, Banco Santander, BNP Paribas and Banque Fédérative du Crédit Mutuel alike.

On the acquisition financing side, Lemaitre advised BC Partners on the sale of Picard Groupe to Lion Capital for an estimated €1.5 billion. The transaction was closed on October 14 2010 after receiving approval from the European Competition Authorities.

In the second quarter of 2011, Jean-Pierre Lee and François-Régis Gonon from Mayer Brown led the team advising GE Capital on the setting up of a factoring facility involving the trade receivables originated by the French, Swiss and German subsidiaries of a steel manufacturing group. The mandate was worth €350 million. An ongoing mandate, priced at €190 million, saw a team represented LBO France in its acquisition of the Materne/MontBlanc group for an amount of €190 million.