Broadcom Corp. is one of a handful of technology acquirers that has honed its dealmaking acumen to the degree that, for the most part, the wireless and communications chipmaker feels perfectly comfortable buying companies of all sizes without the use of an investment bank, thank you very much.
This confidence was apparent even in the Irvine, Calif.-based company's largest transaction to date, the $3.7 billion agreement to buy processor designer NetLogic Microsystems Inc. The deal, announced Sept. 12, was handled by an internal Broadcom team overseen by chief financial officer Eric Brandt and Gary Ignatin, the company's vice president of corporate development. Ignatin joined Broadcom as deputy general counsel in 2000, a very busy dealmaking year marked by several large transactions for the company, including the $2 billion purchase of broadband processor maker SiByte Inc. and the billion-dollar purchase of networking chipmaker Silicon Spice Inc.
The former Latham & Watkins LLP lawyer was named vice president of corporate development at the chipmaker in 2007, the same year Brandt was hired. Brandt previously spent two years as president and CEO of Avinar Pharmaceuticals Inc. and before that was CFO of Allergan Inc.
While no external financial advice was sought by Broadcom, it did turn to a team from Skadden, Arps, Slate, Meagher & Flom LLP, led by Kenton King, for legal advice. King, who is also representing Hewlett-Packard Co. in its pending $10.8 billion purchase of Autonomy Corp. plc, says the experience of an in-house dealmaking team such as Broadcom's has enabled the company to build a very extensive M&A playbook.
"Broadcom is a company that is very good at doing deals," King says. "They've got a very good process, so they're a great client to work for."
King advised on Broadcom's unsuccessful hostile attempt to acquire storage technology maker Emulex Corp. for $764 million in 2009. The firm has worked with Broadcom on a string of deals since then, including the company's acquisitions of networking chipmaker Teknovus Inc. for $123 million and wireless chipmaker Beceem Communications Inc. for $316 million last year, and of Provigent Inc. for $313 earlier this year. Skadden also advised on Broadcom's $700 million notes exchange offer and represented the company in the courtroom, successfully defending former CFO William Ruehle in a federal stock-options backdating case in 2009.
Joining King on the NetLogic transaction were Skadden lawyers Leif King (no relation), Joseph Yaffe and Alec Chang, all out of the firm's Palo Alto, Calif., offices.
On the NetLogic side, longtime outside counsel Alan Kalin of Bingham McCutchen LLP led the legal team, which included Bartley Deamer, William Berkowitz, Mia Weber Tindle, Stephen Alexander, Christopher Berka, Michael Schultz, Natascha George and Brandon Bigelow.
Kalin's history with the company stretches back to 2004, when he represented NetLogic in its initial public offering. He also led the team that advised the chipmaker on its 2007 purchase of RMI Corp., a maker of high-performance processors, for $271 million.
NetLogic hired Qatalyst Partners' George Boutros and Jason DiLullo for financial advice. Frank Quattrone's firm is having a busy couple of months, having advised Autonomy on its sale to Hewlett-Packard, and, along with Centerview Partners LLC, Motorola Mobility Holdings Inc. in its $12.5 billion sale to Google Inc., announced in August.
-- Olaf de Senerpont Domis
Deals in the oil services industry continue, especially with the stock market indexes off and well-capitalized companies looking for bargains. One example is Technip SA's acquisition of subsea construction and pipe-laying services provider Global Industries Ltd., of Carlyss, La., announced Sept. 12, for $1.07 billion, including $136 million in debt. At $8 per share, the offer is a rich 55% premium over Global's share price the previous trading day. But analysts say it's a fair price compared with other deals in the sector -- and for a company that's been struggling with losses due to a downturn in the marine construction industry and a continued low level of project activity worldwide.
Blackstone Advisory Partners LP's Jean-Manuel Richier in Paris and Tudor, Pickering, Holt & Co. Securities Inc.'s David Cunningham, Lance Gilliland and Caroline Bec Cox in Houston provided Technip with financial advice.
Richier, who joined Blackstone in 2009 from Citigroup Inc., and before that worked in the finance group at Goldman, Sachs & Co., has advised Technip before, including on its acquisition of 8% of Malaysia Marine and Heavy Engineering Holdings Bhd., an affiliate of Malaysian state-owned oil company Petroleum Nasional Bhd., known as Petronas, in October for an undisclosed sum as part of a collaboration to work jointly on onshore and offshore projects and design and build offshore platforms.
Cunningham is an old hand at oil services deals. Before joining Tudor Pickering in 2007 after 10 years at Credit Suisse Group, he advised Hanover Compressor Co. on its $3.8 billion merger with Universal Compression Holdings Inc. and Hydril Co. on its $2.16 billion sale to Tenaris SA. More recently, in July, he assisted privately held Edge Oilfield Services LLC and affiliate Summit Oilfield Services LLC on their sale to Key Energy Services Inc. for $300 million. And he and Gilliland advised Key on the sale of its pressure-pumping and wireline assets to Patterson-UTI Energy Inc. that same month for $237 million. He also advised TPG Capital on its $500 million investment in Valerus Compression Services LP in 2009. Gilliland is probably best known for helping Chinese oil company Cnooc Ltd. get a piece of the U.S. shale business with its $1.08 billion purchase of a 33.3% stake in properties in South Texas' Eagle Ford Shale and its $570 million acquisition of a one-third stake in leases covering 800,000 acres in the Denver-Julesburg and Powder River basins in Colorado and Wyoming, both from Chesapeake Energy Corp.
Davis Polk & Wardwell LLP's Will Aaronson in New York and Arnaud Pérès in Paris counseled Technip, snagging the business from Clifford Chance LLP's Thierry Schoen, who had worked on Technip's Malaysia deal. Aaronson was busy before that working in different sectors, including advising NBCUniversal Media LLC on its purchase of a 50% stake in Universal Studios Florida in June from Blackstone Group LP for $1 billion. Pérès, who joined Davis Polk in 2005 after 15 years at Freshfields Bruckhaus Deringer LLP, is known for his counsel to Gérard "William" Louis-Dreyfus when the Louis-Dreyfus family sold their 38.3% stake in Louis Dreyfus SAS to Robert Louis-Dreyfus in 2007 for $2 billion and French nickel and manganese miner Eramet SA on its acquisition of Norway's Tinfos AS in 2008 for $938 million. More recently, in April, he advised Electricité de France SA on its acquisition of 50% of EDF Energies Nouvelles SA it didn't own, a deal that valued the company at $4.3 billion.
Frederick Charlton at Simmons & Co. International and Vinson & Elkins LLP's Jeffery Floyd and Stephen Gill assisted Global. Charlton has been busy in the past year with the consolidation of the oil services industry. In August he advised U.K. oil services company Hunting plc on its acquisition of Dearborn Precision Tubular Products Inc. for $83.5 million and Hunting on its purchase of Titan Group Inc. from private equity firm Riverstone Holdings LLC for $775 million. In July he assisted Seismic Micro-Technology Inc. on its sale to IHS Inc. for $500 million and last year advised Superior Well Services Inc. on its sale to Nabors Industries Ltd. for $900 million.
Floyd, meanwhile, has worked on big energy deals, including counseling Veritas DGC Inc. on its sale to Cie. Générale de Géophysique SA in 2006 for $3.1 billion and Tom Brown Inc. on its sale to Canada's Encana Corp. in 2004 for $2.7 billion. More recently, he advised Energy Transfer Partners LP on its $2 billion agreement to buy Energy Transfer Equity LP's 50% stake in Florida Gas Transmission Co. LLC's pipeline system if ETE's contested $5.7 billion acquisition of Southern Union Co. closes (a rival bid from Williams Cos. is still out there).
But Floyd does more than energy: He also represented Continental Airlines Inc. on its sale to UAL Corp.'s United Air Lines Inc. last year for $3.47 billion. Gill worked on one of the biggest oil services deals recently, assisting BJ Services Co. on its purchase by Baker Hughes Inc. last year for $6.8 billion. More recently, in July he counseled Vanguard Natural Resources LLC on its purchase of the 54% of Encore Energy Partners LP it didn't own for $538 million, giving Vanguard full access to Encore's oil reserves in the Rockies and West Texas' Permian Basin (he had previously advised Vanguard when it bought Denbury Resources Inc.'s 46% stake in Encore Energy Partners for $380 million in January).
Floyd and Gill were also paired when they assisted Huntsman Corp.'s Huntsman Pigments LLC on its proposed purchase of bankrupt pigment maker Tronox Inc. in 2009 for $415 million. Tronox shareholders resisted, saying the bid was far too low, and came up with a reorganization plan of their own. Floyd and Gill are probably hoping Global-Technip goes more smoothly. -- Claire Poole