But the buyer was strategic-Mars, Incorporated, which had anticipated the credit meltdown and chosen early on to work elements of an LBO into the deal. For that job, Mars’s counsel, John Finley, was well-suited, having represented such companies as Toys “R” Us, Inc.; The Neiman Marcus Group, Inc.; and Claire’s Stores, Inc., in their sales to private equity outfits ["Deals 'R' Us," March 2006].
“Given Mars’s conception of how they wanted to do the deal, I was able to use my experience in private equity to do the transaction on an LBO model,” Finley says. By the time the deal was announced in April 2008, Finley had already created the acquisition vehicle, which would buy Wrigley with an equity commitment from Mars and debt commitments from Berkshire Hathaway and Goldman Sachs. (In the end, Berkshire kicked in $2.1 billion in equity and $4.4 billion in debt, and Goldman put up $5.7 billion in debt.) Under the terms of the resulting agreement, Mars would be liable only for a $1 billion breakup fee if the acquisition vehicle failed to close the deal for any reason.
