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

M&A activity in the UK has been fragile of late. Mirroring the bank market, practitioners have seen a situation where good targets are few and far between, resulting in many pitched battles over the best assets particularly with private equity investors. "Private equity is back which puts more pressure on strategics to move now, they are getting more focused," says one partner and another agrees. "Private equity is coming back and will continue to come back and that will effect the M&A market."

There is still activity, but even when a deal is underway practitioners are finding it difficult to get through to conclusion. "Before [the financial crash] there was a lot of cookie cutter work, clients were basically deal machines," explains one partner. "Now it's more difficult to get these done and get them across the line. Now issues, which would have been left, are now being brought up as the deal goes along."

This has elongated the bid process and there is now no such thing as a simple deal. "Deals are more partner heavy in terms of time, you need heavy partner involvement in deals," explains another partner. "They are not deals where you can rely on your precedents to get you through, there's a lot of blue sky thinking." Practitioners have also had to ensure that the desire to get the deal done is not an overarching one. "It's a dangerous route if you let it affect your behaviour," says one M&A lawyer. "Its important for a lawyer, if you want to be trusted by a client, to be able to tell them to walk away."

In the wake of the acrimonious takeover of Cadbury by Kraft last year, there has also been greater attention placed on the takeover of domestic businesses by foreign entities. "I do think that the aftermath of Kraft Cadbury and other Euro-protectionism is making some US companies think twice about aggressive moves," says one partner.

Following the public outcry over the Kraft deal, the UK's Takeover Panel announced a series of potential reforms to the Takeover Code in October 2010. The one which garnered the most attention was the so-called 'put up or shut up' stipulation whereby a potential bidder would have to make their approach formal within 28 days of its commencement. While there is a keen desire to, as business secretary Vince Cable said: "Throw sand in the system" and reduce the image of the UK as a light touch jurisdiction for M&A, the reforms are unlikely to change the landscape dramatically. However it may well reduce the sort of cautious dithering, which has been rife in the market over the last few years.

Freshfields' stock in trade is corporate, the firm lives and breathes M&A and after another strong year it remains at the top of the UK market.

The corporate group is led by Mark Rawlinson who has gained press attention recently following his involvement in an attempted takeover of Manchester United.

The group's numbers were freshened up last year with the promotion of three senior associates – Tim Wimot, Mark Austin and Oliver Lazenby – to partner.

"Excellent technically, impressed with all different areas, strong industry knowledge, calm, they think things through during pressurised times. When moral was low they kept going," says one client.

Last year two Canada linked deals highlighted the firm's continuing strength. In the first, in what proved to the largest take private deal of 2010, a team led by David Higgins and Simon Weller advised the Canada Pension Plan Investment Board and Onex on their acquisition of UK engineering firm Tomkins for £3 billion, with the deal financed through a high-yield bond issuance.

Staying in Canada, a team including Philip Richards; Andrew Hutchings, Simon Priddis; Jonathan Cooklin; James Smethurst and Sarah Murphy acted for the London Stock Exchange Group in its, ultimately unsuccessful, merger with TMX, the owner of the Toronto Stock Exchange. The deal would have been implemented through a Canadian plan of arrangement which would have seen the London entity acting as the holding company and also incorporating a separate Canadian company to act as the bid vehicle for the deal. The deal ultimately fell though after TMX felt it was unlikely to receive shareholder approval.

Another significant merger saw the firm act for PartyGaming on its £1.1 billion proposed merger with bwin Interactive Entertainment, which would create the largest listed online gaming entity in the world. The deal would be undertaken through a reverse takeover which would see PartyGaming need to re-list its shares on the LSE.

The firm's strong corporate client base has also been maintained by the work they put into relationships. "Since the transaction there has been a concerted effort from them to keep a line in our organisation, to find areas they can help us with in coming years," says one client. "You want a partner you can pick up the phone to, someone you trust will respond, We feel valued, they have been keen to try to help, spotting issues they can help us with which makes our job easier and reflects well on them."

Another high-profile transaction saw the team act for the Zhejiang Geely Holding Group on its $1.8 billion takeover of Volvo. Chris Brown, Edward Braham and Neil Radford acted on the acquisition from Ford which was the largest automotive acquisition by a private Chinese company to date.

A final highlight saw Will Lawes, Stephen Revell and Ben Spiers act for Cayman registered entity the Gartmore Group on its £392 million takeover by the Henderson Group by way of scheme of arrangement. As a Cayman entity, Gartmore was not bound by the City Code on takeovers and mergers, however the shareholders sought synchronicity with the code throughout the transaction.

Of all the magic circle, Linklaters has arguably had the most success balancing its banking and corporate practices and this continued ability to offer an equal service across the two areas keeps them in the top tier.

The team had considerable success in the oil sector last year. One of the largest deals saw the London team coordinating with colleagues in New York and Brussels to advise BP on the combined $7 billion acquisition of oil assets in Brazil, Azerbaijan and the Gulf of Mexico from the Devon Energy Corporation. London partners Stephen Griffin, Lee Taylor and Graham Phillips led on the deal, which also saw BP entering into a joint venture with Devon which saw it sell a 50% stake in oil sands assets in Alberta in Canada.

In another oil deal, Nick Rumsby, Fiona Hobbs and Owen Clay acted for the Korea National Oil Corporation on its £1.9 billion hostile takeover of Dana Petroleum, a North Sea and African focused corporation. Alongside this an offer was made for Dana's convertible bonds.

Another substantial deal saw a team led by Charlie Jacobs and Richard Good acting for the Zain Group, a Middle Eastern telecoms operator on the $10.7 billion sale of the majority of its African assets to Indian corporate Bharti. This proved to be the largest ever overseas acquisition by an Indian company.

Also in the telecoms sector, a team including Tom Shropshire and Dan Lawrie, working alongside the firm's Moscow office, acted for United TeleSystems on its merger with Russian provider Mobile TeleSystems

In the energy sector, Matthew Middleditch and Iain Wagstaff acted for GDF Suez and Belgian company Electrabel on the $20.2 billion reverse takeover of International Power, which would see GDF transfer its energy assets to International Power and in return GDF would claim a 70% shareholding.

"Slaughter and May is more of a free radical in terms of quality guys no doubt," says one peer. With one of the strongest UK client bases in the market and a roster of highly regarded partners, the team once again sits atop the M&A table. "They are the best M&A practice in the UK," was one client's succinct opinion.

One of the largest deals undertaken last year, which was ultimately unsuccessful, saw the team acting for UK insurer Prudential on a proposed acquisition of AIG's Asian entity AIA Group for $35.5 billion. The financing through the deal was part raised through a rights issue on the Hong Kong and Singapore stock exchanges. The deal also involved members of the firm's Hong Kong team and was ultimately aborted in June 2010.

Another high profile deal saw a team led by Mark Zerdin and Nigel Boardman act for the board of Liverpool Football Club and parent companies Kop Football and Kop Football Holdings on the £300 million sale to New England Sports Ventures, the entity which also owns the Boston Red Sox.

Gary Eaborn came in for specific praise from clients: "A very good technical lawyer and draftsman, very commercial, very pragmatic. Having worked together a long time he understands us as a client, what we want and how we want to do business," says one.

A long running deal which gained much press attention was the €5.3 billion merger between British Airways and Iberia. David Wittmann and Stephen Cooke acted alongside 'best friend' firm Uría Menéndez. The unified holding company International Consolidated Airlines Group listed on the LSE and Spanish stock exchanges in January 2011.

Relationship building was an area where clients felt the team excelled: "Regular contact between us as we are working together in other areas. We feel very valued as clients and regard ourselves as one of their most important clients, which is how we feel we are being treated. The partner relationship is very important."

Another highlight saw Jonathan Marks and John Papanichola acting for Greencore on a proposed $1.7 billion merger with Northern Foods. The deal was ultimately withdrawn following a higher offer made by the Boparan Group, it would have been the first time the EU Cross Border Merger Directive had been used under the UK's City Code on Takeovers and Mergers.

Utilising its banking links, the firm also acted for Santander on its £1.3 billion offer for numerous branches of the Royal Bank of Scotland Group including individual branches of RBS and NatWest. The deal sees Santander further increase its footprint in the UK and was acted on by partners Andrew Jolly and Frances Murphy.

Some peers have suggested that Allen & Overy's growth of its corporate client base highlights a greater focus on this area as the firm tries to balance this with its traditionally strong finance offering. However this perceived growth is seen to have, if anything created some distance between it and its tier two contemporaries rather than necessarily bringing it closer to the market leaders. "The Allen & Overy machine has looked hungrier, leaner and slicker than the Clifford Chance machine," says one peer.

A headline grabbing deal saw the team acting for News Corporation on its proposed acquisition of BskyB. The offer was eventually withdrawn following the phone hacking scandal, which engulfed News Corps UK newspaper wing News International. As part of the proposed deal the team also oversaw the $400 million sale of the Bulgarian bTV Group to Central European Media Enterprises.

Another high profile mandate last year saw the team act for Dana Petroleum on the £1.8 billion hostile takeover by Korean National Oil Corporation (KNOC). Dana's main focus in terms of its asset base is in the North Sea and North Africa. The deal also included KNOC acquiring Dana's convertible bond portfolio.

Although ultimately unsuccessful, the team also advised TMX the controlling entity of the Toronto Stock Exchange on the merger with the LSE. The deal was eventually withdrawn after TMX felt it would be unable to secure shareholder approval.

Another substantial deal saw partners Richard Cranfield, Anna Buscall and Louise Wolfson advising Cable & Wireless on the $3.9 billion demerger into two new LSE listed entities.

Other highlights include advice to Eversholt Investment Group on the sale of its Rail Group to HSBC Asset Finance for £2.1 billion, acting for GLG on its $1.6 billion sale to the Man Group and the KBC Group on the acquisition of Global Convertible Bond and Asian Equity Derivatives from Daiva Capital Markets for £2.1 billion.

"I think that Clifford Chance has bounced back a little bit, much stronger than they were before, I get the impression that Clifford Chance is ahead of A&O and A&O is ahead of Herbert Smith." This comment from one peer was a typical assessment of the M&A second tier, however the question of which of the three firms mentioned could be said to have the edge brought a mixed response with no clear outcome.

As a result Clifford Chance maintains its tier two position with there being little disagreement that the firm's deal list and reputation justified its standing.

The team led by Simon Tinkler has taken steps to increase its manpower taking Tim Lewis from Macfarlanes. There was also a fair amount of movement out of London to the firm's other outposts. Guy Norman and Nigel Wellings both moved to Dubai in October and July 2010 respectively, while Nick Rees made the shift to Moscow in May 2010.

Energy and infrastructure related projects proved to be the most successful area of practice for the firm last year. One of the largest deals saw the team act for GDF's Energy International division on its £17 billion merger with GDF Suez, with the deal enacted through a reverse takeover. Pipe manufacturer Wellstream Holdings also called in the firm to advise on its £800 million sale to General Electric.

The team also acted for JPMorgan Infrastructure Investment Fund as lead investor in the acquisition of Grupo ACS' Spanish ports business for €720 billion.

One deal, which gained attention due to the fact that it involved a public asset, saw the team act for Eurotunnel, M&G Investments and Goldman Sachs on a bid for the Channel Tunnel Rail Link High Speed 1.

There was a fair amount of debate in the market as to which of the current tier two firms were closest to challenging the market leaders. While there was no clear consensus about which of the three was currently ahead, the market was largely in agreement that the team pushing the hardest was Herbert Smith. "There's no doubt Herbert Smith have done extremely well," says one peer. "They do pop up, especially on the UK deals," says another. The issue as many peers saw it was that the firm's name is not as strongly associated with the corporate area compared with some of its rivals, with litigation still seen as the firm's key driver. "I think Herbert Smith are better than Allen & Overy and Clifford Chance but the problem is that people don't see the name as closely linked to M&A as those two," explains one peer.

However this image is somewhat misleading, clear steps have been made in the last few years to position the firm as a real challenger in M&A and the firm's deal list shows clearly that this strategy is working, as one peer says: "There's still a lot of people out there who see Herbert Smith as a litigation practice, but you just look at the deals they have done."

Clients have no doubt about the firm's quality: "We've known the firm for a long time and we rate them highly. Very good level. Their communications with clients are pitched at the right level. Very personable," says one. Another points to the firm's organisational skill: "We had a lot of deals at any one time, there was a big team from Herbert Smith, they put in place things to make communication more simple, introduced a system to keep track. They did very well."

Certainly in terms of media coverage and notoriety (in the context of the subsequent 'phone hacking scandal'), one of the firm's key mandates last year saw it act for BskyB on the £7.8 billion offer for the company by Rupert Murdoch's News Corporation. Stephen Wilkinson and Malcolm Lombers acted for the broadcasting company on the protracted deal which was eventually withdrawn following public outcry over the alleged phone hacking activities undertaken by members of News Corp's newspaper wing, News International.

Another deal in which the firm acted for a well known British brand, saw the team acting for the al Fayed Family Trust on the sale of the Harrods Group, owner of the department store of the same name, to Qatar Holding the investment wing of the Qatar Investment Authority. Roddy Martin and Chris Parsons led on the deal which closed in May 2010.

In the energy sector, the team acted for EDF on the sale of the firm's UK network assets to Cheung Kong Infrastructure Holdings for £5.8 billion. This drew in Herbert Smith teams from Paris and Brussels.

There has been much debate in the British media this year about the proposed High Speed 2 Rail Link between London and (eventually) Glasgow. In light of this the firm advised on the sale of the original High Speed 1, the Channel Tunnel rail link, for £2.1 billion to Canadian pension fund Ontario Teachers' Pension Plan and Borealis Infrastructure. This forms part of the UK government's privatisation plan.

A final highlight saw the team act for Northern Foods on the proposed, though ultimately unsuccessful merger between it and Greencore and the subsequent successful bid by the Boparan Group. The original Greencore bid would have been the first time the EU Cross border Merger Directive had been used under the UK's City Code on Takeovers and Mergers.

Ashurst took the opportunity to reorganise the management of its M&A team in 2010 appointing Stephen Lloyd as the global head of corporate and Simon Beddow as his European equivalent.

In corporate circles, the firm is better known for its extremely strong private equity practice with links to the likes of Nordic Capital and Candover Investment. However this is not to say that the firm does not get its fair share of public mandates as well.

One of the largest deals last year saw Adrian Clark acting for the Chloride Group on a £997 million offer for Emerson Electric. Another highlight saw the firm advise engineering and construction firm the URS Corporation on its offer for consultancy firm the Scott Wilson Group.

Another notable mandate saw Robert Ogilvy Watson acting fro Kexim on Korea National Oil Corporations $2.6 billion bid for the share capital of Dana Petroleum. In the mining sector Ogilvy Watson and Clark worked together, acting for the Chinese energy group CGNPC Uranium Resources on its cash offer for mining company Kalahari Minerals which is active in Namibia.

Cleary Gottlieb's London team remains focused on deals emanating from certain emerging markets and its locations of traditional strength such as Russia.

One of the largest transactions the team worked on last year saw them act for BHP Billiton on its $40 billion bid for the Potash Corporation of Saskatchewan. This followed an early private merger offer.

It proved to be a busy summer in 2010 for Simon Jay who acted on two major deals in June and July. In one, a team also including Tim Knipe, Garry Manley and Esther Kelly acted for JPMorgan Chase, specifically its Ventures energy division on the £1.7 billion purchase (through cash and the assumption of debt) of RBS Sempra Commodities that deals in oil, metals and agriculture amongst other things.

Moving across to utilities, Jay and his team also acted for the Marubeni Corporation and joint venture partner Innovation Networks Corporation on the acquisition of Chile's third largest water company Agua Nuevas from Santander.

Also of note and a deal that showed the firm's global scope was its work for the AltynGroup in regards to the $509 million acquisition of Kazakhgold's interests in subsidiaries in Kazakhstan, Romania and Kyrgestan. AltyhGroup is controlled by the Assaubayev family and the deal itself arose from a dispute between them and Polyus Gold in regard to the latter's acquisition of controlling stake in KazakhGold. On the transactional side the team was led by Tihir Sarkar.

Macfarlanes' focus lies on domestic transactions arising from its strong UK corporate client base. An example of this and one of the firm's largest mandates last year saw a team led by Graham Gibb and Charles Martin acting for Brit Insurance Holdings on the £1.3 billion cash offer by Apollo Management and CVC Capital Partners.

Clients appreciated the amount of partner time they received and also pointed out that rate wise the firm is an economical choice: "They are slightly less expensive than others, it's the efficiency with which they staff a particular job," says one client who worked with Graham Gibb. "The [partner] relationship is always important, you need to trust them and I trust Graham."

Another significant deal, led by Luke Powell saw the team act for ICAP on its €122 million offer for TriOptima, a financial technology company operating in the OTC derivatives space. The deal was completed under Swedish law.

Also in the financial trading space the team acted for BATS Global Markets on its acquisition of Chi-X Europe a move that created one of the largest pan-European trading platforms.

Highlighting its domestic strength the team also advised Whitbread on its acquisition of Coffeeheaven.

Known globally for its strong corporate practice, Skadden remains a solid performer in the UK market. Although not the biggest team in the market, the US firm can draw on its areas of regional experience such as the Middle East, Russia and to a certain extent Brazil.

This year has seen the firm acting on a string of telecoms related deals including advice to Altimo, a shareholder in VimpelCom, the Russian telecom operator, in relation to its merger with the Italian telecom assets of private investment vehicle Weather Investments.

Another deal, which also highlights its growing Brazilian influence, the firm assisted Portugal Telecom on the $9.8 billion acquisition by Telefonica of its 50% stake in Vivo Participacoes. The team here was led by Scott Simpson who also acted alongside Michael Berkner acting for Nokia Siemens Networks on its $1.2 billion acquisition of Motorola's wireless network infrastructure assets.

Outside of telecoms and shifting the focus to Africa, the firm also advised on two key deals on the continent. In one the team acted for Vitol Group and Helios Investment Partners in the $1 billion acquisition of the majority of Shell's downstream oil assets on the continent. In the other BSG Resources (BSGR) called in the team to act on the creation of a joint venture with Vale to develop mining in Guinea. The deal saw Vale acquire 50% of BSGR Guinea for $2.5 billion.

The Sullivan & Cromwell M&A team is led by Timothy Emmerson and US law partner Richard Morrissey. The firm's strength lies more on the private equity side of the corporate sphere in the UK, but with its strong operations in Frankfurt and Paris, the firm is well set in European M&A.

In one example last year Morrissey was active alongside English law partners Craig Jones and Benjamin Perry acting for the Harris Corporation on the acquisition of Global Connectivity Services from Schlumberger.

Morrissey was also called in by BP to act as UK and US counsel on the oil company's $7.1 billion sale of its interest in Pan American Energy to Bridas.

Mayer Brown's M&A capacity in the UK was hit slightly last year as partner Lauri-Lyn Pursall moved across to Charles Russell.

One of the largest deals worked on by the firm last year saw the team advise The selling shareholders on the £389 million sale of the Camelot Group to Ontario Teachers' Pension Plan. The team also advised the Scott Wilson Group on its takeover by a subsidiary of the URS Corporation.

Acting on the former deal was Andrew Stewart who also assisted Stephanie Bates on a high profile deal in the media. The team acted for Independent News & Media on the sale of The Independent and The Independent on Sunday and its associated businesses to a vehicle owned by Russian Alexander Lebedev.

"Having worked with them in the past, they've been good at editing on proposals," says one client. "They have a good level of appreciation of how their proposal charges are relevant to their clients."

The Norton Rose M&A team increased its headcount last year with the hire of Ian Lopez from Allen & Overy.

With large insurance companies now one of the few sources of liquidity on the market, a number of big ticket mandates have been emerging from the sector. Last year, the team at Norton Rose found themselves acting on two of the largest. In one Martin Scott and Maria Ross acted for Axa UK on the sale of the majority of its UK life business to the Frined's Provident Group for £2.75 billion. The team also acted for AIG on the proposed sale of its Asian life insurance business, AIA, to Prudential to $35.5 billion. James Bateson and Helen Paul acted on the deal.

One client points to the team's more generalist approach as a particular advantage: "They are as strong as any other firm that we would deal with and what's more those partners have the technical knowledge themselves rather than bringing in the relevant specialists," the same client continues: "Early on in the transaction the team identified what the key issues will be and came up with technically correct and commercially sound solutions."

Outside of the insurance sector, the team also assisted one of the UK's largest building society's, Coventry Building Society, on its £21.1 billion merger with Stroud & Swindon.

Shearman's M&A team, led by Laurence Levy secured a role on one of the market's most high-profile mandates last year when it acted for New England Sports Ventures on its acquisition of Liverpool FC. The deal was complicated when certain equity holders in the club tried to prevent the board from going ahead with the agreed deal. This resulted in litigation in the UK and US, which Shearman also acted on and resulted in the original deal going ahead.

One client who worked with Levy and Lucy Graham points out their individual qualities: "Lawrence had a logical mind, and very stable in situations of conflict. Lucy Graham, she came in at the most difficult moment. She was very organised very good and was very professional, great to work with."

Other substantial mandates included acting for Ardagh Glass on the €1.7 billion acquisition of Impress Cooperative, holding company of the Impress Group. The team also assisted Ardagh on the financing which involved a high-yield debt issue. In a similar area, head partner Levy also assisted Tata Steel on its sale of Teeside Cast Products Business to Sahaviriya Steel Industries Public for £475 million.

The team also acted for BSkyB in regard to a joint venture with ADMIC to establish a new Arabic news channel in the Middle East. Based in Abu-Dhabi the channel will broadcast across the region.

Simmons & Simmons took some positive steps this year with the hire of Colin Bole (former senior associate at Allen & Overy) and Steven McNab who moved from Travers Smith to head the firm's environmental and climate change practice. Both partners combine M&A work with equity capital markets transactions. However the firm did also see the departures of partner David Shasa who left for Gowlings and Richard May who moved to Fried Frank.

One of the firm's largest deals last year, made good use of its funds experience as a team advised Gartmore on a £4.1 billion merger of its private equity fund business with Hermes.

Other highlights included acting for Cheung Kong Infrastructure Holdings on the £211.7 million acquisition of BG Group's 50% in Seabank Power and medical technology company Becton Dickinson on the sale of its global ophthalmic systems business to Roundtable Healthcare Partners.

The corporate team at Travers Smith worked across a range of sectors last year and the firm can point to a strong track record in upper mid market transactions.

One of the largest mandates last year saw the team advise the Peel Group on the sale of the Trafford Centre to Capital Shopping Centres Group (CSC) for £1.65billion. The deal also saw the Peel Group take a 24.9% diluted shareholding in CSC.

One client liked the attention the firm paid to client relationships: "Yes they are excellent. We've had other business deals with them last year. They keep in regular contact throughout the year, invite me to training seminars, they send out information on particular topics. Yes, I feel valued."

Another seller side role saw the team advise long standing client Intec Telecom Systems on its £236.7 million sale to CSG Systems. Travers has acted on all of Intec's own M&A activity since 2000 and indeed certain takeovers were still being enacted while the company itself was being sold.

Finally in the transport infrastructure sector, a team led by Richard Skelton and Anthony Foster acted again for the Peel Group on the sale of its 65% stake in its airports division, including John Lennon airport in Liverpool and the Robin Hood Airport in Nottingham to Vancouver Airport Services.

Thomas Thesing leads the Sidley M&A team in London. The firm is better know for its capital markets work in London, but the team does crop on select transactions.

An example of this is the team's work advising FLIR Systems on the $180 million acquisition of Raymarine. The deal went through many permutations and indeed the takeover's structure was changed many times eventually resulting in a pre-pack purchase of the company from administration. This was the first time a LSE listed company had been bought through a pre-pack while being the subject of a hostile takeover.

Thesing led on the previous deal as he also did when the firm acted for AllscriptsMiSys Healthcare Solutions on its merger with the Eclipsys corporation. The deal saw Allscripts parent company MiSys reducing its shareholding to a minority stake.

One client who worked with Thesing said: "I have good contacts with the partner, this relationship is very important. The partner is needed to oversee to the core deal, he knows what we want. We have a lot of interactions in other areas not necessarily on M&A."

Weil is better known for its private equity work and the London office is no different, however this is not to say that it does not maintain a decent public M&A practice.

Media and TV related work is a specialisation and this was demonstrated by the team's workload last year. Highlights include advise to AII3Media on its acquisition of TV producer Optomen, which also included the acquisition of a joint venture with Chef Gordon Ramsey's company One Potato Two Potato.

The London team also acted for China Media Capital on the acquisition of three Chinese TV stations: Xing Kong, Xing Kong International and Channel [V] Mainland China from News Corporation. The deal also included the Fortune Star Chinese Movie Library.

Outside of the media the firm acted for the Home Delivery Network on its acquisition of DHL Domestic from Deutsche Post.