Category: Deals and Cases

Wolf Theiss has advised Union Bank, one of Albania’s leading banks, on its acquisition of 100% of the shares in the LandesLease financial leasing company. Zaka & Kosta represented LandesLease.

Wolf Theiss advised Union Bank as lead counsel on all aspects of the transaction, including corporate and tax structuring, conducting a legal due diligence, and the negotiation of the transaction documentation. Wolf Theiss also advised Union Banka on all regulatory aspects of the transaction and secured clearance of the transaction with the Bank of Albania. The transaction closed in December 2014. 

The Wolf Theiss team in Tirana was led by Partner Sokol Nako. The Zaka & Kosta team was led by Partner Entela Memishaj Shehaj, and included Attorneys Elona Koleka and Enis Borici.

Image source: panoramio.com

Spilbridge has successfully represented Yelverton Investments before the European Court of Human Rights in a dispute against the Republic of Latvia in what the firm describes as “a helpful example to understand certain remnants of the Soviet system in the Latvian judicial system.”

The Chairman of the Civil Department of the Latvian Supreme Court had filed a protest, seeking to quash a “binding judgment” worth EUR 5000 for Yelverton Investments against the Latvian state in a previous matter. According to a statement released by Spilbridge, although Western jurisdictions do not recognize the ability to quash binding judgments, Latvia is an “embarrassing exception,” being one of “various countries that [were] contaminated by this Soviet approach.” The firm reports that “the General Prosecutor’s Office are (sic) still filing such protests resulting in many binding judgments being quashed.” The firm conceded, in its analysis, that protests should be available to “remedy manifest miscarriage of justice (sic),” but “it should be done on the basis of an application of the party concerned rather than on the basis of a protest filed by a public official vested with discretion whether to do it or not.”

In this case, the firm explained, on November 18, 2014, “the case law of the European Court of Human Rights caused the Supreme Court to dismiss the protest and help our clients to keep the protested judgment standing.” 

Yelverton Investments was represented by Spilbride Managing Partner Daimars Skutans and Senior Associate Oskars Jonans.

Wolf Theiss has advised Pivovarna Union on the sale of 57.63% of its shares in the Birra Peja brewery in Kosovo to the Devoli Group beverage producer.

Pivovarna Union is a member of the Pivovarna Lasko Group, the largest Slovenian brewery, the shares of which are listed on the Ljubljana stock exchange. According to Wolf Theiss, “the sale is part of an ongoing process of divestments of non-core assets, which members of the Pivovarna Lasko Group undertook vis-à-vis its banks in a multi- party financial restructuring agreement that concluded in April of this year, making this a successful milestone on Pivovarna Unions’s way to turn around.”

Wolf Theiss advised on both Slovenian law and Kosovo law. Wolf Theiss drafted and negotiated the share purchase agreement and ancillary documentation and provided advice on all relevant aspects of corporate law, competition law, and IP. In addition, Wolf Theiss assisted in the negotiations regarding license agreements for Pivovarna Union brands, so that Birra Peja can continue trading these well established brands in Kosovo.

The transaction team was coordinated by Wolf Theiss Partner Markus Bruckmuller and Senior Associate Klara Miletic. Partner Christian Mikosch and his team provided assistance on aspects of Kosovo law. Financial advisor to the seller was UniCredit Bank Austria. Wolf Theiss continues to advise the Pivovarna Lasko Group on its restructuring as well as in its ongoing search for an investor by way of a capital increase. 

Earlier this year, Wolf Theiss advised the same brewery in Slovenia on a EUR 300 million debt restructuring (reported on by CEE Legal Matters on May 16, 2014).

Weinhold Legal and Norton Rose Fulbright have advised Tauron, a major Central European energy company, on the creation of a joint-venture with ArcelorMittal.

Both companies will hold 50% stakes in Tameh Holding, the newly created joint-venture vehicle, which will operate heat and power stations in Poland (TAMEH Polska) and the Czech Republic (TAMEH Czech). Tauron is Poland’s second largest utility company, and ArcelorMittal is the world’s largest steelmaker. ArcelorMittal is already a Tauron customer in Poland, a Tauron press release stated, and the deal will help secure that relationship, while also cutting costs for the steelmaker.       

Tameh will control two of Tauron’s power stations, ZW Nowa and Elektrownia Blachownia, and two of ArcelorMittal’s heat and power cogeneration stations – one in the Polish city of Krakow and one in the Czech city of Ostrava. 

The agreement between the companies closed on August 11, 2014 for a period of 15 years with the ability to extend it in the future.

Norton Rose Fulbright’s Warsaw team was led by Energy Partner Rafal Hajduk, assisted by Adam Kozlowski, Artur Jonczyk, Grzegorz Filipowicz, Konrad Kosicki, Michal Blaszkiewicz, Natalia Jankowska, and Jan Grochowicz.

Weinhold Legal’s role included “due diligence and assistance related to the contractual documentation governed by Czech law.” The firm’s team was led by Partner Daniel Weinhold, in cooperation with Managing Attorney-at-law Lukas Zahradka, among others. Weinhold commented that: “We are very pleased to have assisted in another significant transaction in the energy sector. The scope of our engagement and the ambitious time schedule required considerable effort by our experienced team.” 

Sorainen has advised Nordea, the largest financial services group in northern Europe, on the transfer of its Baltic banking business — operated by Nordea Bank Finland in Estonia, Latvia and Lithuania — to its Swedish parent company Nordea Bank. 

The firm describes the transaction as, “the first transfer of a pan-Baltic credit institution business as a going concern of such scale and complexity covering all three Baltic States,” and says that it “involved transfer of the material part of regulated banking operations of one of the largest banks in the Baltics, and had to be implemented in all three countries simultaneously, despite differences in the legal frameworks.”

Sorainen advised Nordea throughout the transaction, from drafting the initial project implementation plan through to closing and actual transfer of the business. The team supported Nordea in liaising with the local financial supervision authorities in the Baltic States, and established new branches of Nordea Bank in the Baltics. The firm claims that the scope and complexity of the transaction required involvement of most of its practices (including banking and finance, M&A, real estate, dispute resolution, public procurement, employment, and tax). 

The Sorainen team involved lawyers from all three Baltic offices. It was led by Partners Rudolfs Engelis, Tomas Kontautas, and Reimo Hammerberg, and included Senior Associates Santa Rubina, Augustas Klezys, Mantas Petkevicius, and Piret Lappert.

CMS has advised Dixons Retail on the sale of its ElectroWorld operations in the Czech Republic and Slovakia to Slovak electronics retailer NAY. 

Dixons Retail is one of Europe’s leading specialist multi-channel electrical retailer and services companies. ElectroWorld operates 22 stores in the Czech Republic and 4 in Slovakia, which for the financial year that ended on April 30, 2014, generated a turnover of GBP 129 million.

CMS Partner Helen Rodwell, who led the CMS team on the deal, commented: “We are delighted to have advised Dixons on this transaction. We are currently seeing an uptick in M&A activity in the Czech Republic and the wider region and particularly players from within CEE that aim to increase their geographical footprint remain keen to purchase high quality assets in nearby markets.”

Rodwell’s team included Senior Associates Patrik Przyhoda and Frances Gerrard. 

White & Case has secured victory for Turkish conglomerate Cukurova Holding, as a seven-year dispute with Russia’s Alfa Group came to an end yesterday when Cukurova regained its controlling interest in Turkcell, the largest mobile telecommunications company in Turkey.

The firm reported that Cukurova paid USD 1.6 billion to redeem the security over the Turkcell shares, “giving effect to the order that it had won in the Privy Council in March 2014.” The redemption was financed by a loan from Ziraat Bank, a state-owned Turkish bank.

“It has been an extraordinary case on many levels,” said White & Case Partner John Reynolds. “Cases of such legal and commercial significance are rare.”

The case concerned a strategically significant block of Turkcell shares which Cukurova had provided to Alfa as collateral for a loan in 2005. Alfa claimed that Cukurova was in default under the loan facility and purported to appropriate the shares by way of enforcement. The core issue in the litigation was whether Alfa had effectively appropriated the shares and, if so, whether Cukurova had a right to redeem that security. The Privy Council determined in March this year, having considered authorities stretching back more than 200 years, that the long-established equitable principle of “relief against forfeiture” applies in the case of an appropriation under the 2003 Financial Collateral Arrangement Regulations.

The litigation began in 2007 in the British Virgin Islands and has involved 14 hearings before the Commercial Court in the BVI, seven appeals to the Eastern Caribbean Court of Appeal, and eight hearings before the Privy Council in London.

In the first phase of the case, between 2007 and 2008, the Courts determined a preliminary issue concerning the scope of the 2003 Regulations and Financial Collateral Directive, the first time that this pan-European legislation had been tested in any court. The matter went to a full trial in 2010, won by Cukurova, and the appeal was determined by the Privy Council in March 2014.

Reynolds added: “The British Virgin Islands is growing in popularity as a jurisdiction for cross-border investment vehicles and joint ventures and the BVI Commercial Court has become correspondingly busy. Cases like ours demonstrate the effectiveness of that jurisdiction in resolving complex international disputes.”

The White & Case litigation team was led throughout by Reynolds, who was supported by Partner Charles Balmain and Associate Amanda Cowell, all based in London.

The team worked closely with a BVI litigation team led by Arabella di Iorio, head of Maples and Calder’s BVI office. The counsel team throughout was Kenneth Maclean QC, James Nadin, and David Caplan of One Essex Court.

White & Case also advised Cukurova in relation to the Ziraat Bank loan. That London-based team was led by Partner Christopher Czarnocki and included Associates Sally Koo and Sophie West.

Freshfields Bruckhaus Deringer has advised the Kering luxury brand group on the acquisition of all shares in the Swiss Ulysse Nardin watch manufacturer.

Listed on the Euronext Paris Euro, luxury and lifestyle company Kering (formerly PPR) operates with brands like Gucci, Saint Laurent, Stella McCartney, Brioni, Puma. The company generated a turnover of EUR 9.7 billion with 35,000 employees in 2013. With the acquisition of Ulysse Nardin, Kering strengthens its Luxury Watches and Jewelry division. The transaction must still be approved by the relevant competition authorities and is expected to be completed in the second half of 2014.

Freshfields accompanied Kering on all aspects of the transaction outside of Switzerland, where the company was advised by the Homburger law firm. The Freshfields team — which included lawyers from the firm’s Moscow and Vienna offices — consisted of Heiner Braun, Maximilian Platzer, Xianbei Li, Sebastian Pritzkow, Stephan Purps, Jennifer Ju, Nathalie Di Thomasso, Maria Borodina, Pavel Annekov, Alexandra Basheva, Massimo Caruso, Silvestro Nasturzio, Richard Bird, Andrew Wood, Allen Yan, Mohammad Tbaishat, Axel Reid Linger, and Alex Viktorov.

Following shortly after the Permanent Court of Arbitration in the Hague ordered that the Russian government pay USD 50 billion in damages to former Yukos shareholders (reported on by CEE Legal Matters on July 28, 2014), the European Court of Human Rights has now awarded the shareholders an additional EUR 1.86 billion in damages in a lawsuit filed against the Russian tax authorities.

   

(pca-cpa.org)

The court’s ruling was published on July 31, 2014. The damages award is the ECHR’s biggest to date. Moscow also has to pay an additional EUR 300,000 in legal costs to the Yukos International Foundation, a Netherlands-based company that houses some of Yukos’s remaining assets.

At the same time, the court rejected the Yukos shareholders’ claim that the unfair tax proceedings led to the company’s liquidation in 2007, ruling that “there was insufficient proof of a causal link between the violation found and the pecuniary damage allegedly sustained by Yukos.” 

In a statement, Russia’s justice ministry noted that it “does not view this ruling as an example of a fair and unbiased approach to the legal and factual circumstances of the case.”

In 2004-2005, the Moscow Commercial Court collected over RUB 300 billion from Yukos in tax arrears for 2000-2004, while dismissing a lawsuit filed by Yukos to invalidate the results of an auction to sell Yuganskneftegaz, an oil producing asset of Yukos, and to award it RUB 388.3 billion rubles in damages. Yukos shareholders filed suit in 2004, claiming that the Russian tax authorities had unlawfully confiscated their property in violation of the articles of European Convention on Human Rights, and demanding USD 98 billion in damages.