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Trio of Am Law 200 Firms Take Lead on $1 Billion Credit Rating Buy
The Am Law Daily
Consumer credit reporting agency Equifax has agreed to buy the credit services unit of Computer Sciences Corporation (CSC) for $1 billion in cash.
The deal with struggling CSC will help generate an additional $115 million to $125 million in revenues next year for Equifax, according to a statement announcing the transaction by the Atlanta-based company.
Kilpatrick Townsend & Stockton is advising Equifax on the deal through corporate partners W. Stanley Blackburn and Gregory Cinnamon, executive compensation and employee benefits partner Jennifer Schumacher, and tax partner Lynn Fowler, all of whom are based in Atlanta.
Predecessor firm Kilpatrick Stockton, which merged with Townsend and Townsend and Crew in late 2010, has been a longtime legal adviser to Equifax, which provides consumer credit scores and credit history reports to lenders. In 2007, however, the company decided to give its consumer litigation work to King & Spalding, according to a report at the time by sibling publication the Daily Report.
Equifax chief legal officer Kent Mast, a former Kilpatrick Stockton partner, is leading a team of in-house attorneys also working on the deal that includes transactions and technology counsel Shawn Baldwin and corporate counsel Jessica Clay. Equifax announced in October that Mast would retire at year-end and be replaced by King & Spalding senior corporate partner John Kelley III in Atlanta.
Walter Driver Jr., an independent member of Equifaxs board of directors since 2007 and the former president of the United States Golf Association (Jones Day partner Glen Nager assumed that role earlier this year), served as chairman of King & Spalding until his retirement from the firm in 2005. Siri Marshall, a former general counsel and chief governance and compliance officer for General Mills, is also a member of Equifaxs board.
Falls Church, Virginiabased CSC, a leading provider of information technology and systems integration services, has been seeking to cut costs and restructure its operations as it copes with a general decline in government spending. CSC plans to use the roughly $800 million in after-tax proceeds from the sale of its credit services unit, which it operated under a contract with Equifax, to buy back shares and fund its pension plans.
Baker Botts M&A partner Neel Lemon is leading a team from the firm advising CSC that includes corporate partner Courtney York, employee benefits partner James Raborn, tax partner Stephen Marcus, and IP partner Bradley Williams. The firm has long handled corporate, litigation, and regulatory work for CSC.
Working closely with Baker Botts on the deal are CSC general counsel William Deckelman, deputy general counsel M. Louise Turilli, assistant general counsel Danelle Gulley, senior counsel Scott Thompson, and Akin Gump Strauss Hauer & Feld corporate partner Gemma Descoteaux in Dallas. The sale of CSCs credit services unit to Equifax is expected to close before the end of the year, pending regulatory approvals.
The acquisition by Equifax comes almost two months after the company agreed to pay $393,000 in a settlement with the Federal Trade Commission to resolve claims that it improperly sold information on consumers who didnt make their mortgage payments on time, according to sibling publication The National Law Journal.
The NLJ reported last week that specialty credit reporting companies like Equifax, Experian, and TransUnion have come under scrutiny from regulators like the Consumer Financial Protection Bureau, which want people to have easier access to free copies of their annual credit reports. Earlier this year, the CFPB proposed new rules to supervise large credit reporting agencies and debt collectors, according to the NLJ.