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Vinson & Elkins has served as legal counsel to the China Petroleum & Chemical Corporation (Sinopec) in connection with its December 17, 2015 purchase of a strategic 10% stake in SIBUR, Russia’s largest vertically integrated gas processing and petrochemicals business. Cleary Gottlieb advised SIBUR on the deal. Sinopec will have the right to nominate a representative for SIBUR’s Board of Directors as a strategic investor.

According to a joint press release from Sinopec and SIBUR, “the successful completion of the transaction will deepen the cooperation between the two companies and create value for both. The investment will also lead to better sharing of joint expertise and resources, which will strengthen not only the market leading positions of both companies, but also the strategic cooperation between China and Russia.” 

Sinopec Corp is one of the largest integrated energy and chemical companies in China. The scope of its business mainly covers oil and gas exploration and production, extraction, pipeline transmission and marketing; oil refining; production, marketing, storage and transportation of petrochemicals, chemical fibers, chemical fertilizers and other chemical products; import, export and import/export agency business of crude oil, natural gas, refined oil products, petrochemicals, chemicals, and other commodities and technologies; research, development and application of technology and information.

SIBUR is a vertically integrated gas processing and petrochemicals company, which owns and operates Russia’s largest gas processing business in terms of associated petroleum gas processing volumes. As of September 2015, SIBUR operated 26 production sites in Russia, had over 1,400 large customers engaged in the energy, chemical, fast moving consumer goods (FMCG), automotive, construction, and other industries in approximately 75 countries worldwide, and employed over 25,000 personnel.

“Sinopec’s 10% minority investment in Sibur not only deepens the cooperation between the two companies, but also represents an active implementation of China’s ‘One Belt, One Road’ policy,” commented Wang Yupu, Chairman of Sinopec. “SIBUR’s vertically-integrated upstream and petrochemicals business model is highly complementary with Sinopec’s businesses. This transaction is in-line with our objective to strategically expand our petrochemical business overseas. Our continued partnership will help diversify and secure Sinopec’s long-term sourcing of petrochemical products.” 

Leonid Mikhelson, SIBUR’s Chairman of the Board, was — unsurprisingly — similarly enthusiastic. “The decision of Sinopec, a major player in the global petrochemical market, to acquire a stake in SIBUR confirms the success of the management’s effort to transform the Company into a gas processing and petrochemical leader and comes as a recognition of SIBUR’s high growth potential,” he said. “Getting Sinopec on board as a strategic shareholder will help to build the synergy required to bring SIBUR’s growth to a brand new level.”

In September 2015, SIBUR and Sinopec signed a strategic partnership agreement during a state visit by Vladimir Putin, President of the Russian Federation, to Xi Jinping, the President of the People’s Republic of China. The successful completion of the transaction is an important step in the development of the strategic cooperation between the two countries. As a next step, both companies are reportedly considering the participation of Sinopec in the Amur Gas Chemical Complex construction project as a strategic partner with SIBUR. 

The Vinson & Elkins team consisted of Partners Xiao Yong (in Hong Kong), Jay Kolb (in Beijing), Natalya Morozova (in Moscow), and Rob Patterson (in Abu Dhabi), along with Counsel Li Zhaohui (in Beijing) and Nick Molan (in Hong Kong), and Associates Sarah Teh (in Beijing) and Elena Sauber (in Dallas).

The Cleary Gottlieb team in Moscow was made up of Partner Scott Senecal, Counsel-elect Maxim Izvekov, and Associates Denis Guzilov, Marta Talakina, and Irina Malinichkina. Brussels-based Partner Robbert Snelders, Cologne-based Counsel Tilman Kuhn, and Brussels-based Associate Andris Rimsa provided antitrust advice.

Carrefour announced today an agreement to acquire Billa Romania from the Rewe group. Tuca Zbarcea & Associatii advised Carrefour while the sellers were assisted by Schoenherr. Pachiu & Associates represented Billa Romania. The completion of the transaction remains subject to approval by the relevant antitrust authorities.

Spread across Romania, the 86 supermarkets of Billa Romania have a total sales area of 83,000 square meters. According to the Carrefour press release announcing the agreement, “through this acquisition, Carrefour would become the leading supermarket operator in Romania, strengthening its multiformat offer to better serve its clients.”

The Tuca Zbarcea & Associatii team was led by Partner Razvan Gheorghiu-Testa — who also led the Tuca team advising Carrefour on its recent leasing of a logistics hub at the P3 Bucharest park (reported on by CEE Legal Matters on December 8, 2015). 

The Schoenherr team was led by Partner Markus Piuk and included Vienna-based Senior Associate Clemens Leitner and Bucharest-based Partners Madeline Neagu, Silvia Opris, and Catalin Suliman, Senior Associate Alexandra Munteanu, and Associate Anda Tufan.

Pachiu & Associates preferred not disclosing the composition of its team working on the deal. 

Integrites has acted for VTB Bank Ukraine on its share capital increase in the amount of UAH 14.5 billion (approximately EUR 563.7 million), designed — according to Integrites — “to ensure the continued sustainable development of VTB Bank on the Ukrainian market.”

Integrites reports that, as a result of the recapitalization, VTB Bank Ukraine has the third-most authorized capital among Ukrainian banks. 

Integrites conducted legal support to all corporate, approval, and compliance procedures related to recapitalization of the bank by the private placement of additional shares, including the holding of the General Meeting of Shareholders, gaining approval by the National Bank of Ukraine, and registering the share issue as stipulated by the regulations of the National Bank of Ukraine and the National Commission on Securities and Stock Market.

The firm’s team was led by Partners Ruslan Bernatsky and Vsevolod Volkov. 

The Aivar Pilv Law Office successfully represented client Argo Ader, an individual, in a civil court dispute with the Seesam Insurance AS company.

In December 2014 the Seesam Insurance AS filed a claim against Argo Ader in the amount EUR 49,107.73, supplemented eventually with a claim for interest in the amount of EUR 15,715.46. A similar claim had been filed in a previous criminal proceeding involving allegations that Ader had committed insurance fraud by staging a fake car accident. The criminal case was terminated on statute of limitations grounds, after which the insurance company submitted its civil claim against Ader.

In its December 8, 2015 decision, the Harju County Court ruled that Seesam Insurance had not proved that Ader intentionally staged the car accident and submitted incorrect data to the insurance company in order to receive compensation. As part of its findings, the court stressed that for 5 years after the controversial accident, Seesam Insurance had kept the damaged Dodge Viper in outdoor conditions which significantly deteriorated the car’s condition, in the process increasing Adaer’s damages “since it was impossible to sell the wrecked car for the price that would have been appropriate under different conditions.”

The Aivar Pilv team was led by Managing Partner Aivar Pilv and Attorney Marko Pilv.

KSB has advised Dioscorides Global Holdings, LLC (DGH) in negotiating, concluding, and implementing an Investment Agreement regarding a joint-venture investment into Konomed s.r.o.

The commercial purpose of the investment was to finance and commercially participate in a project involving the founding of the International Cannabis and Cannabinoid Institute in Prague, which opened on Tuesday, December 15th. The ICCI is a joint project of patient organizations, Czech scientific societies, and DGH — a New York-based investment platform focused on the emerging legal cannabis industry. 

KSB’s advice involved the creation of a mechanism by which DGH acquires shares in Konomed and the negotiation of additional funding principles, while taking into consideration the need to make sure the Investment Agreement, which is governed by the laws of the State of New York, conforms with with Czech corporate law. KSB also helped formulate the fundamental principles of a future acquisition agreement and shareholders’ agreement.

The ICCI (International Cannabis and Cannabinoids Institute) endeavours to explore medical cannabis and its components to treat patients in the future by making custom-made preparations. The Institute will take advantage of the latest knowledge with regard to cannabis and biomedicine within the aim of creating, among other things, a platform for further research, education, and information-sharing. Cannabis treatments are legal in the Czech Republic for AIDS and multiple sclerosis patients, but cannabis available in pharmacies is generally imported and expensive, and doctors are reportedly hesitant about prescribing it.

The KSB team consisted of Partner Martin Solc and Counsel Christian Blatchford.

Hedman Partners has assisted enterprise eProcurement software provider Deltabid in expanding its operations and raising additional funding via a stock swap and in the transferring and licensing of Deltabid’s intellectual property to a newly established company.

Hedman additionally designed and implemented the transfer pricing structure between the parent company in the United States and its subsidiary in Estonia.

Hedman Partners describes Deltabid as eProcurement software to replace “feeble e-mail and Excel-based procurement methods with a modern, streamlined, and transparent process, thus reducing costs and giving a real-time oversight.”

Hedman Partners was represented by Partners Dmitri Tsimpoaka and Merlin Salvik, IP Attorney Toomas Seppel and Tax Consultant Kardo Rander.

Paris Passias is the Legal Director of the Navarone shipping company. Prior to joining the company in June 2015, he was briefly the General Counsel of Vivartia, preceded by three years as a Partner with the Kitsaras Passias Sfikas Tsantitis Law Firm (he served double duty from 2012-2014, during which time he also acted as in-house counsel for Navarone). Before that, Passias was the General Counsel of the telecom operator OTE for 4 years after working as the Head of the Foreign Investments Legal Department and General Counsel of OTE International Investments. His experience also includes working as an in-house counsel for the International Reefer Services Shipping Company and as an Associate with Rokas and Partners.

P.P.: I believe it was always the international focus that drew me in and made sure it stuck with me. Early in my career I worked in Germany, and that was probably the first such exposure, but especially once I came back to Greece and worked with OTE, I acquired a real taste for such an exposure, with the telecom group expanding considerably throughout SEE, as you know [referring to OTE’s recent acquisition of shares in the Romanian telephone operator Romtelecom]. 

Shipping is one of those industries that is, by definition, internationally oriented so it was inevitable to become attracted. 

P.P.: Geographical position aside, I think it’s simply a matter of a natural talent. Greeks have historically been merchants – at least considerably more so than manufacturers – and I think that’s just been a tradition that has stuck with us. 

P.P.: That’s actually a common misconception. I wouldn’t say the industry received any special support to be honest. The one example towards this that I can think of is the state insurance promises provided to the shipping industry after World War II, when the sector took a hit with the global decline in trade. 

In recent days, in fact, it is going in the opposite direction, with budgetary pressures being reflected in the taxing regime that we need to operate under. With the shipping industry being so big, it was bound for it to get on that radar. 

P.P.: I am not 100% sure about that number, but, indeed, the industry is one of the largest employers in Greece. I would say that, for the most part, the same employment regulations are applicable to us as to any other type of company. As a result, I would not say we face any specific challenges on that end, especially since labor unions in Greece are not as strong as they would be in other places, and that could be an area where one would imagine the volume of employees would play a big part. 

Of course, that number probably accounts for Greek nationals employed within the shipping industry. Here you need to differentiate between onshore and offshore staff. Onshore, most of our employees tend, indeed, to be Greeks, and they usually represent highly-skilled and well-paid technicians, engineers, etc., meaning that the “usual” labor concerns rarely pop up. In terms of the offshore employees, many are foreign nationals, and that complicates things a bit, but nothing insurmountable. 

P.P.: Indeed, one of the main aspects about our legal function is the variety of having to deal with an issue in Argentina one day, then with a port issue on the other side of the world the next. One thing that simplifies everything greatly, however, is the fact that almost all legal aspects that have to do with our industry tend to operate under common law. How is that reflected within our organization? Firstly I am qualified as a solicitor as well and I do tend to work a great deal of the time with UK-based law firms. As for issues coming up that require specific local legal knowledge, we simply outsource them to local firms.

P.P.: No, definitely not. It’d simply be way too expensive to have one specialist on call for each of the immensely diverse jurisdictions we deal with on a regular basis.

P.P.: I think that pretty much all of the ‘big boys’ are already in Greece to be honest, so even if there would be room in the market, I don’t really see many contenders left who might be targeting the market and are not on the ground already. The few who have not yet ticked a presence were probably scared off by the current economic climate, but to be honest, at the end of the day, so much of the work would happen out from London that I am not sure it’d be needed for them to open up an office here. Maybe it made a lot more sense in the past, but thanks to technology these days, I simply don’t see a logistical need anymore. 

P.P.: Athens should be the first stop. The Greek capital is “small Greece” itself! Visit the new Acropolis Museum, built by the New York-based architect Bernard Tschumi with its 4,000 beautiful objects and the stunning view over the Parthenon Temple. Stroll in the old city of Plaka, have lunch at a seaside tavern in the picturesque harbor “Mikrolimano” (little harbor) in Piraeus, drive southwards on the cliff-fringed route to catch up with the most awesome sunset from the Poseidon Temple in Cape Sounion. Enjoy your goodbye drink at the Galaxy bar in the Hilton Hotel with the amazing panoramic view over the city of Athens and the glittering Saronic Sea. 

This Article was originally published in Issue 2.5. of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Clifford Chance has advised Martin Machon, the CEO and 40% shareholder of APS Holding SE, on his acquisition of the remaining 60% of shares in APS Holding from the Central European investment group Slavia Capital. The transaction value was not disclosed.

APS Holding is a leading European company in the acquisition, management, and recovery of loan portfolios, particularly of banks. Through its four investment funds, it offers returns on investments to individual investors. The company was founded in Prague in 2004 and employs 450 people across seven European countries. APS manages assets totalling more than EUR 3 billion, and has a total value exceeding EUR 20 million. For 2014, the company’s revenue was EUR 12.31 million and its EBITDA was EUR 3.15 million. For 2015, the company expects revenue of EUR 16 million and EBITDA over EUR 5 million.

Machon is the founder of APS and has 12 years of experience with investment and advisory within the non-performing loans segment. He earned his MBA from the University of Rochester, New York, and previously worked at Societe Generale and Lucent Technologies. “Our plan is to continue to grow APS over the long term,” he said. “We see opportunities not only in new markets in Europe and Asia but also in new products, particularly in developing real estate portfolios as well as providing returns on investments into our investment funds. In terms of territorial expansion, we want to continue our current pace of growth, as last year we expanded our activities into Greece and this year we will complete the licensing procedure in Vietnam.”

Image Source: aps-holding.com

Dimitris Smirnis holds senior in-house positions with Metro, Optima, Grantex, and Diagnosis, all while also working as the Managing Partner of Smirnis & Associate Law Firm.

CEE Legal Matters reached out to him to learn more about this rather unusual set-up. 

D.S.: I studied at the Law Department of University of Athens and I started my career as a lawyer in 1998. In the first years I practiced as an Attorney at Law dealing mainly with civil and penal law cases.I provided legal services to my clients – both individuals and companies – and had many court appearances. Later, I focused on practicing corporate and business law. In 2005 I started working as a counsel at Metro S.A., a leading company in retail and wholesale of food and household products. Also in 2005 I started working as a counsel at Optima S.A., a brother company of Metro S.A. dealing mainly with cheese and dairy products. Today I’m the Head of Legal of both companies, which continue to grow aggressively despite the economic crisis in Greece.

I’ve also been a Legal Counsel at Grantex S.A. since 2008 and Diagnosis S.A. since 2011. Grantex S.A is a brakes and parts company and Diagnosis S.A. provides health services.

D.S.: According to Greek Law, a lawyer in Greece is a “public servant,” who practices law in private. It sounds conflicting but it’s not. It means that lawyers cannot be employees while they provide legal services to companies. So I decided not only to keep managing the Smirnis & Associates Law Firm but to also to develop the firm. This is not common in the Greek Market. Most lawyers who work as in-house counsels stop practicing in private but I preferred to go against the mainstream and this decision proved right.

D.S.: Time management is an everyday challenge. As a counsel I devote most of my time to the companies I work for and as a manager at Smirnis & Associates I supervise but I also trust my colleagues to serve our clients.

D.S.: Yes they have. Our cooperation is excellent. When my physical presence is not possible, we stay in touch thanks to technology.

D.S.: We do not represent other clients from these sectors of the market in order to avoid conflict issues. 

D.S.: Both companies honored me by proposing to be their Legal Counsel having full knowledge of my professional status, so there were no objections or concerns.

D.S.: Being the Head of Legal at METRO S.A. is the most challenging role. Its continuous growth and development requires not only leadership and efficiency but also thoughtfulness and essential and timely consulting.

D.S.: Not for the time being, but I keep my mind open to future challenges. 

D.S.: Both worlds are rewarding. Private practice provides freedom of choices. In-house counseling provides knowledge of interacting inside a corporate environment.     

D.S.: The essence of life is living the present but I’ll answer your question. I would be a novelist.

This Article was originally published in Issue 2.5. of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Eleni Stathaki is the Head of Legal at Upstream, a leading end-to-end m-commerce provider for subscription-based digital services in developing markets. Prior to joining Upstream in 2010, Stathaki was as in-house counsel with Sonae Sierra between 2007 and 2010 and with AEGEK between 2002 and 2007. In 2006, she was also an intern in London with Lovells (now Hogan Lovells), while on training leave with AEGEK.

E.S.: While in law school, I never thought I would end up as a law practitioner – I was envisaging a career as an academic. Then life happened. Very early on, I gravitated towards in-house work: first in a group of construction groups, dealing with public procurement and infrastructure works. Then, I moved to a shopping center management group, and lastly to Upstream, which is active in the mobile/digital industry. Incidentally, all three groups were active in South Eastern Europe and specifically in Romania. 

I don’t see changing industries as a negative thing; on the contrary it keeps things interesting. In any case, regardless of the industry, the skills needed are the same anywhere: delivering practical, commercial legal advice in the business context.

E.S.: In a major way! Like other companies in this sector, Upstream has always been a very agile, fast paced, dynamic company, always looking for innovation. This agility is part of its corporate culture, so it could not leave Legal unaffected. As a result, I focus on being practical, commercially minded, and open to new ideas. Dealing with ambiguity is also another competency I have cultivated here. Upstream offers its services in more than 26 languages, and over 50 markets, each with its own special characteristics and requirements. What works in one market may not work in another.

Lawyers as a professional group are naturally cautious: when presented with a business proposition, normally my first impulse would be to say “No, this is risky.” But this attitude is counter-productive and would get us nowhere. So now the approach is more like: “Yes, under the following conditions.” 

E.S.: This is, in fact, a situation that we have often dealt with. One of our first projects in Greece in 2005 was very new both in a commercial and in a regulatory sense and it caused quite a stir. 

In most cases of a new product or solution, I find that either there is some legislation on the matter which has become obsolete or addresses a slightly different situation, or that there are detailed regulations in place, which however have not yet been tested in practice and on which there is no case law. 

The answer in both instances is the same. We do our homework thoroughly and we get advice from experts. Then we find the middle ground between opting for the aggressive scenario and playing it safe. Ultimately, it is a fine line to walk and very challenging from a legal point of view, but our approach has worked so far! 

E.S.: We mostly do contractual work, drafting, reviewing, and negotiating agreements of all kinds. As Upstream has a wide geographical footprint, and is active in over 50 markets, from Brazil to Vietnam, we make sure we get thorough legal advice on the regulatory environment in each country by coordinating with outside counsel. We also handle day-to-day corporate matters for the headquarters as well as all the subsidiaries, although we outsource complex transactional work.  

Other than that, we work closely with Finance and Human Resources on all day-to-day matters from the opening of a bank account to helping with obtaining visas. Never a dull day! 

E.S.: A little bit of both: I tell the tech team what our obligations are and they find the appropriate security measures to comply with them, and to ensure that our technology platform that handles over 10 billion interactions a year meets these requirements.

Having reached over 1 billion consumers, and engaged over 200 million users around the world, we take data protection very seriously indeed. The fact that we are able to consistently deliver the highest engagement rates in the industry reflects our commitment to privacy protection. We have always been very careful, and as a result we have never had any issues. However, with the EU General Data Protection Regulation coming on, we will need to overhaul our policies to make sure they are up to speed. We have certainly planned to invest time and effort into this.  

E.S.: As there are only three of us in the Legal Department, we do outsource specialized legal work quite often. There is no single criterion, but rather a combination of several: expertise, responsiveness, professionalism, business acumen. It is essential that counsel gives relevant advice, taking into consideration both commercial and business aspects. Last but not least, value for money is always important, as is keeping within budget. 

E.S.: Like I said, it’s a small department that is still evolving, so there are no strict KPIs. Instead, we review the firm’s overall performance. A key question is whether the firm gave timely, practical, and value-added advice, and whether they were responsive. I also appreciate it when counsel shows a constructive attitude vis-à-vis the issue at hand, especially in the context of corporate transactions and contract negotiations. 

E.S.: The global map that hangs on the wall. It is very exciting to see where the next project is, e.g. Mozambique or Peru. I have improved a lot in geography in the last five years! 

This Article was originally published in Issue 2.5. of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.