Dentons, Latham Advise on Koch's $7.2 Billion Molex Buy
Massive conglomerate Koch Industries is paying $7.2 billion to acquire Molex, a manufacturer of electronic interconnectors, with Latham & Watkins representing Koch and Dentons working for the target.
Wichita-based Koch Industries, the country's second-largest privately held company behind Cargill, said Monday it has agreed to pay $38.50 in cash for each Molex share—a premium of 42 percent over the target's Friday closing price. The deal is expected to close by the end of the year—pending approval from regulators as well as Molex shareholders—at which point Molex will retain its name and management team as well as its headquarters in Lisle, Illinois.
Molex makes electronic connectors used in a variety of industries including the automotive, computer, and telecommunications sectors. The company employs more than 35,000 people and operates 41 manufacturing sites in 15 different countries.
The acquisition is the second-largest ever for Koch Industries—which in recent years has made waves due to the political views of CEO Charles Koch and his brother and company co-owner, David. In 2005, Koch Industries paid $21 billion for paper and chemicals company Georgia-Pacific.
Latham is advising Koch Industries with a team led by Chicago-based corporate partners Mark Gerstein, Bradley Faris, and Timothy FitzSimons. Partners Bradley Kotler and David Rathgeber are advising on finance matters, while litigation chair Sean Berkowitz and litigation partner Catherine Palmer are working on corporate compliance matters. Compensation and benefits partner Bradd Williamson, tax partner Diana Doyle, environmental partner Arthur Foerster, intellectual property partner Jeffrey Tochner, real estate partner David Shapiro, and knowledge management lawyer Kaitlin Reidy Verber are also advising. London-based M&A partner Richard Brown is handling U.K. securities matters.
Latham previously advised Koch Industries on its 2003 acquisition of a textiles unit from DuPont for $4.4 billion. The firm also advised on the 2005 purchase of Georgia-Pacific and later advised Georgia-Pacific on a $1.8 billion sale of its European tissue business to Sweden's SCA, in 2011. (In related M&A news, SCA said Monday it is offering $1.1 billion to buy Chinese rival Vinda International.)
The general counsel of Koch Industries is Mark Holden, a former Akin Gump Strauss Hauer & Feld labor law attorney. (Holden made news earlier this year when he accused the Obama administration of deliberately intimidating Koch Industries after the Internal Revenue Service admitted to subjecting the tax filings of conservative political groups to additional scrutiny.)
Meanwhile, Molex has turned to a team of Dentons attorneys for legal advice on its sale. Chicago-based corporate and securities partner Michael Froy is leading the way for Dentons. Corporate and securities partner Matthew Dykman, corporate and securities counsel Rani Doyle, employee benefits partner Pamela Baker, and antitrust partner Stephen Libowsky are also advising. Others on the deal include senior managing associate Samuel Schlessinger, managing associates Natasha Lipovac and Sergey Kotelnikov, and associate Daniel Marino. Molex's in-house legal team was led by general counsel Robert Zeitler and associate general counsel Mark Pacioni.
Froy previously advised Molex on its 2006 purchase of Woodhead Industries for $256 million, as well as the 1999 acquisition of auto-parts company Cardell for $129 million.