Softbank/Sprint Nextel; T-Mobile/MetroPCS; UnitedHealth/Amil
Some analysts speculated that Sprint Nextel Corporation would try to thwart the planned merger of T-Mobile USA and Metro PCS Communications Inc. by launching a hostile bid for Metro PCS . Instead, Sprint Nextel agreed to sell a 70 percent stake to Softbank Corp. for $20.1 billion, in what would be the largest foreign acquisition ever by a Japanese company. The announcement came on October 15, less than two weeks after U.S. cell phone rivals T-Mobile and Metro PCS signed their deal. Sprint Nextel's 56 million subscribers make it the third-largest cell phone carrier in the United States after AT&T Inc. and Verizon Communications Inc. T-Mobile is fourth, Metro PCS sixth.
Softbank will buy $8 billion worth of shares directly from Sprint Nextel, which will use the cash to compete against its larger rivals. Softbank will also purchase another $12.1 billion in Sprint Nextel stockabout 55 percent of the target's public floatin the open market at $7.30 per share. The rest will be converted into shares of a new publicly traded entity to be called New Sprint. The stock market valued Sprint Nextel at about $17 billion, or $5.70 a share, on the afternoon of October 15, a 13 percent premium to its closing price on October 11, the last trading day before news of a possible deal broke. The parties hope to close the deal by the middle of 2013 pending approvals from regulators and Sprint Nextel shareholders.
For acquiror Softbank Corp. (Tokyo)
In-House: General counsel Masato Suzaki.
Morrison & Foerster: Corporate: Dale Caldwell, David Lipkin, Jaclyn "Jackie" Liu, Brandon Parris, Kenneth Siegel, Ivan Smallwood, Robert Townsend, and Andrew Winden. Antitrust: Jeff Jaeckel and David Meyer. CFIUS: Nicholas Spiliotes. Tax: Bernie Pistillo and Eric Roose. Executive compensation: Michael Frank. Financial transactions: Peter Dopsch and Kathryn Johnstone. (Caldwell, Siegel, Smallwood, Winden, and Roose are in Tokyo; Liu, Parris, Townsend, and Pistillo are in San Francisco; Lipkin and Frank are in Palo Alto; Jaeckel, Meyer, and Spiliotes are in Washington, D.C.; Dopsch is in New York; and Johnstone is in Los Angeles.) MoFo and Mori Hamada & Matsumoto also advised Softbank on its $2.3 billion agreement to buy rival Japanese mobile carrier eAccess Ltd., a deal announced October 1, and MoFo represented Softbank as a shareholder of Alibaba Group Holding Limited when the Chinese Internet service provider agreed to buy back Yahoo! Inc.'s 40 percent stake in Alibaba earlier this year [Big Deals, September]. Siegel began representing the company in the 1990s, when it invested in a number of Internet companies, including Yahoo.
Mori Hamada & Matsumoto: Finance: Yoshifumi Kobayashi. (He is in Tokyo.) The firm took the lead on the $20 billion financing for the deal.
Dow Lohnes: Corporate: Leonard Baxt. Communications: Christina Burrow, John Feore, J.G. Harrington, John Logan, and Michael Pryor. (All are in Washington, D.C.)
Potter Anderson Corroon: Corporate: Mark Morton, Michael Pittenger, and associate Pamela Millard. (All are in Wilmington.) MoFo's Lipkin tapped Potter as Delaware counsel. Sprint will be reincorporated in Delaware as part of the deal.
Foulston Siefkin: Corporate: William Wood II and associate Francis Baalman. (Both are in Wichita.) Sprint Nextel is incorporated in Kansas.
For target Sprint Nextel Corporation (Overland, Kansas)
In-House: General counsel Charles Wunsch, senior counselM&A Todd Barfield and Michael Ragsdale, senior counselsecurities and governance Stefan Schnopp, counselsecurities and governance Aisha Reynolds and Katie True-Awtry, senior vice presidentgovernment affairs Vonya McCann, vice presidentsales and distribution Michael Allen, vice presidentintellectual property Harley Ball, vice presidentcorporate transactions and business John Chapman, vice presidentlitigation Susan "Sue" Haller, and vice presidentsecurities and governance Timothy "Tim" O'Grady.
Skadden, Arps, Slate, Meagher & Flom: M&A: Thomas Kennedy and Jeremy London. Corporate finance: Yossi Vebman. Banking: Stephanie Teicher. Antitrust: Steven Sunshine and Matthew Hendrickson. Executive compensation and benefits: Regina Olshan. Tax: Dean Shulman. CFIUS issues: Ivan Schlager. Telecommunications law: Antoinette "Toni" Cook Bush. (All are in New York, except for Washington, D.C.based London, Sunshine, Schlager, and Cook Bush.) Skadden represented Sprint last year in its opposition to AT&T's proposed acquisition of T-Mobile, a deal the parties abandoned in the face of opposition from the U.S. antitrust authorities.
Lawler, Metzger, Keeney & Logan: Telecommunications: Regina "Gina" Keeney, Charles "Buck" Logan, and A. Richard Metzger Jr. (All are in Washington, D.C.)
Polsinelli Shughart: Corporate finance: William Mahood III and associates Joseph Jarvis and Eric Wu. (All are in Kansas City, Missouri.) Mahood left thenSprint Corporation legal's M&A group in 2000. He has represented the group since then as outside transactional and Kansas counsel.
The U.S. Department of Justice foiled Deutsche Telekom AG 's planned sale of T-Mobile USA to AT&T Inc. last fall. On October 3, almost a year after that deal collapsed, Deutsche Telekom announced an agreement to merge its U.S. cell phone division with Metro PCS Communications Inc. The combined company, which will retain the T-Mobile name, would have about 42 million subscribers and be the fourth-largest cell phone carrier in the United States after AT&T , Verizon Communications Inc., and Sprint Nextel Corporation.
Deutsche Telekom and MetroPCS are employing a complicated structure to effect the transaction. MetroPCS will declare a 1-for-2 reverse stock split, pay $1.5 billion in cash to its shareholders, and then acquire all of T-Mobile's common stock in exchange for a 74 percent stake in the new T-Mobile, which MetroPCS CEO John Legere will continue to run. The companies hope to close the deal in the first half of 2013 pending approvals from regulators and MetroPCS shareholders.
For acquiror Deutsche Telekom AG (Bonn, Germany)
In-House: At Deutsche Telekom: General counsel Claudia Junker, senior vice presidentpublic and regulatory affairs Wolfgang Kopf, vice presidentM&A and joint ventures Axel Lützner, and head of competition law, public policy, and regulatory affairs Volker Stapper. At T-Mobile USA: General counsel David Miller, deputy general counsel Lauren Venezia, vice presidentgovernment affairs Thomas Sugrue, and vice presidentfederal regulatory affairs Kathleen Ham.
Wachtell, Lipton, Rosen & Katz: Corporate: Adam Emmerich and associates Valentina Cassata, DongJu Song, and Mark Stagliano. Finance: Eric Rosof and associates Neil Chatani and John Sobolewski. Tax: Jodi Schwartz, T. Eiko Stange, and associate Tijana Dvornic. Executive compensation and benefits: Michael Segal and associate Timothy Moore. Antitrust: Ilene Knable Gotts and associate Lori Sherman. (All are in New York.) Wachtell also represented Deutsche Telekom on the AT&T deal, as did Cleary Gottlieb Steen & Hamilton and Wiley Rein [Big Deals, June 2011]. Wachtell represented VoiceStream Wireless Inc. when it was sold to Deutsche Telekom in 2001.
Cleary Gottlieb Steen & Hamilton: Antitrust: George Cary, Mark Nelson, and associates Patrick Bock and Robert Devine. Tax: Yaron Reich, Leslie Samuels, and associate Corey Goodman. (The antitrust lawyers are in Washington, D.C.; the tax lawyers are in New York.)
K&L Gates: M&A: Margaret Inouye and associates Elisabeth McNeil and Eric Taylor. Antitrust: Ramona Emerson, of counsel Richard Price, and associate Christopher Wyant. (All are in Seattle, except for Portland, Oregonbased Price.) The firm was counsel to Western Wireless Corporation from its formation in 1988 and to VoiceStream from its spin-off from Western Wireless in 1994. Western Wireless used Wachtell on its 2005 sale to Alltel Corporation.
Wiley Rein: Telecommunications: Nancy Victory and Richard Wiley. (Both are in Washington, D.C.)
For target MetroPCS Communications Inc. (Richardson, Texas)
In-House: General counsel Mark Stachiw and assistant general counsel Melanie Stapp Klint.
Gibson, Dunn & Crutcher: Corporate: Jeffrey Chapman, Robert Little, and associate Travis Souza. Finance: Joerg Esdorn, Darius Mehraban, and associate Stewart Ross. Tax: David Sinak. Employee benefits and executive compensation: David Schiller and associate Krista Hanvey. Antitrust: M. Sean Royall and associate Adam Di Vincenzo. Technology: Stephan Nordahl and associate Daniel Angel. (All are in Dallas except for the following: Esdorn, Mehraban, Ross, Nordahl, and Angel are in New York; and Di Vincenzo is in Washington, D.C.) Chapman represented the company in 2005 when Madison Dearborn Partners LLC and TA Associates Inc. made a $600 million investment in MetroPCS. At the time Chapman was a partner at Vinson & Elkins. He moved to Gibson Dunn last year.
Paul Hastings: Antitrust: C. Scott Hataway and associates Noah Pinegar and Michael Wise. (All are in Washington, D.C.) Stachiw once practiced at the firm, which helped advise MetroPCS on its failed bid for Leap Wireless International Inc. Hataway joined Paul Hastings last year from Howrey.
Telecommunications Law Professionals: Telecommunications: Michael Lazarus, Andrew Morentz, and Carl Northrop. (All are in Washington, D.C.) The group worked with MetroPCS when they were at Paul Hastings. They started their own firm last year.
For MetroPCS board of directors
Akin Gump Strauss Hauer & Feld: Corporate: Robert Dockery, J. Kenneth Menges Jr., and associate Adam Hilkemann. (All are in Dallas.)
Fulbright & Jaworski: Litigation: Karl Dial and Brett Govett. (Both are in Dallas.)
UnitedHealth Group Incorporated expanded into South America by agreeing on October 8 to pay $4.9 billion for a 90 percent stake in Amil Participações S.A. , Brazil's largest health care company. Amil founder and CEO Edson Bueno and partner Dulce Pugliese, Amil's controlling shareholders, will retain a 10 percent stake in the company but will sell 60 percent to UHG , which will buy another 30 percent of Amil from public shareholders.
UHG will pay $4.3 billion for the stock and gain another $600 million in tax benefits. Bueno will stay on as Amil's CEO and will join UHG's board. He also promised to invest about $470 million in UnitedHealth stock that he will hold for five years. UHG hopes to complete the purchase of Bueno and Pugliese's stake by December and buy the public shares in the first quarter of 2013, pending regulatory and shareholder approval.
For acquiror UnitedHealth Group Incorporated (Minnetonka, Minnesota)
In-House: Chief legal officer Richard Baer, senior deputy general counselsecurities Richard Mattera, senior deputy general counsel Kuai Leong, senior associate general counsel Jake Tyshow, and associate general counsel Michael Molepske.
Sullivan & Cromwell: M&A: Sergio Galvis and Keith Pagnani. Tax: Ronald Creamer Jr. FCPA: Theodore Edelman. Executive compensation and benefits: special counsel Rebecca Coccaro. Securities: William Farrar. Antitrust: Juan Rodriguez and special counsel Eric Queen. Arbitration: Joseph Neuhaus. Environmental: special counsel Matthew Brennan. (All are in New York, except for Washington, D.C.based Coccaro and London-based Rodriguez.) Pagnani sat across the table from UHG in 2004 when it bought Oxford Health Plans Inc. of New York for $4.9 billion. A few months later, Michael McDonnell, general counsel of UHG subsidiary UnitedHealthcare, tapped Pagnani for the $500 million purchase of John Deere Health Care Inc. Pagnani went on to advise UHG in its acquisition of Arnett Health Plans Inc. in 2006; in its $2.6 billion purchase of Sierra Health Services Inc. in 2007; and on the purchase of XL Health Group Inc., which was announced in November 2011 and closed in February.
Pinheiro Neto Advogados: M&A: Carlos Alberto Moreira Lima Jr. and associates Pythagoras Carvalho and Mariana Alonso Tomazelli. Capital markets: Henrique Silva Gordo Lang and associate Guilherme Sampaio Monteiro. Litigation and regulatory: Théra van Swaay De Marchi and Gilberto Giusti. Tax: Giancarlo Chamma Matarazzo. Labor: Luís Antônio Ferraz Mendes. (All are in São Paulo.)
For target Amil Participações S.A. (Rio de Janeiro)
In-House: General counsel Henrique Freire de Oliveira Souza and attorneys Geny Guedes de Queiroz Van Erven and Márcio Alexandre Salvador.
LeFosse Advogados: Corporate and finance: Sérgio Machado, Carlos Barbosa Mello, and associates Mirella Mie Abe, Lucas Baptistella, Rafael Erlinger, and Gabriel Silva. Tax: Gustavo Lian Haddad and associate Gustavo Paes. Labor and employment: counsel Mariá Guitti. (All are in São Paulo.) The firm also advised Amil's controlling shareholders. LeFosse represented the company on its 2007 IPO.
Linklaters: M&A: Alberto Luzarraga and associates Peter Cohen-Millstein, Gabriel Silva, and Thomas Wright. Tax: Gordon Warnke and counsel Francisco Duque. Antitrust: associate Antonia Sherman. (All are in New York.) Linklaters is affiliated with LeFosse.
Marcus is senior writer for TheDeal.com. Email: firstname.lastname@example.org.