The UK public M&A market picked up in the second half of 2013, with lawyers pocketing a total of £38.9m in fees – 44 per cent more than they received in the first half of the year.
During the first six months of the year lawyers acting on M&A deals received a total of £29m (22 July 2013).
According to research conducted by The Lawyer, in conjunction with sister data provider Perfect Information, the number of deals increased by more than a third – from 18 in the first half of the year, to 25. However, average combined legal fees paid by both bidders and targets remained static at about £1.5m.
Full details are revealed in The Lawyer’s fourth in-depth review of M&A legal fees, published today.
Freshfields Bruckhaus Deringer, Linklaters, Shearman & Sterling and Bredin Prat were among the four firms to receive the biggest payout on a single deal over the course of the year – an estimated £13.9m in all for their work on Schneider Electric’s £3.4bn offer for Invensys, which was filed in September.
The fees are double those spent on any one deal in the first six months of the 2013, when a raft of firms including Nabarro and Ashurst took a slice of the £6.8m shared out by the parties involved in William Hill and GVC Holdings’ £4.8bn acquisition of Sportingbet (28 January 2013).
Between July and December, four firms stood out for the sheer volume of UK public M&A deals they worked on. Pinsent Masons earned an estimated £865,000 for its advice on four separate deals. DWF was paid £663,100 and Eversheds £470,000, working on three transactions apiece.
Meanwhile, Freshfields took home an estimated £10.6m for its work advising three high-profile target companies on incoming bids – Invensys on its offer from Schneider Electric, ENRC on its takeover by Eurasian Resources and the Daily Mail and General Trust on the sale of its remaining voting shares to Rothermere Continuation.
Freshfields’ London corporate head Julian Long noted: “Overall it was a quiet year, but the second half was better as relative stability continued and confidence began to come back.”
He continued: “It’s hard to be specific about trends in a thin market especially as fees can be quite specific around the deals themselves, in terms of size and complexity. For instance, if a transaction involves antitrust in a large number of jurisdictions as more and more countries introduce anti-trust regimes, or is cross-border, fees will tend to be higher than if the deal is purely domestic.”
The Lawyer’s research only includes M&A which falls subject to the Takeover Code’s disclosure rules, which came into force in September 2011. Since the revamp, businesses have been required to publish estimated fees and expenses on takeovers of UK-listed companies.