Firms Line Up for Legal Work on Three Tech Sector Deals

March 21, 2012 5:17 PM

Firms Line Up for Legal Work on Three Tech Sector Deals

Posted by Tom Huddleston Jr.

Indian information technology company Tech Mahindra said Wednesday that it is absorbing scandal-plagued rival Mahindra Satya in a $1 billion, all-stock transaction.

As The Am Law Daily has previously reported, Tech Mahindra, a joint venture between British Telecom and Mahindra & Mahindra, purchased a majority stake in Mahindra Satya )then called Satyam Computer Services) for $600 million in an Indian government-sponsored auction in 2009.

Satyam collapsed earlier that year when former founder and chairman B. Ramalinga Raju resigned after admitting to falsifying company accounts. He as later charged with forgery and fraud.

Jones Day and Latham & Watkins advised Tech Mahindra and Satyam, respectively, in the 2009 auction process, according to our prior reporting. Satyam also hired Indian firm Amarchand & Mangaldas & Suresh A Shroff to advise on issues arising from the accounting fraud, as well as Wachtell, Lipton, Rosen & Katz for help with shareholder class action suits filed in the U.S.

Both Tech Mahindra and Mahindra Satyam provide businesses with information technology outsourcing services in a variety of industries, with Tech Mahindra primarily serving the telecommunications sector. Under the terms of this transaction, Tech Mahindra will pay one of its own shares for every 8.5 shares of Mahindra Satyam. As a result of the deal, Mahindra & Mahindra will own 26.3 percent of the combined company, while British Telecom will own 12.8 percent and public shareholders will hold most of the remainder.

The companies' announcement of the deal lists Indian firm AZB & Partners as the lone legal adviser on the matter.

Tech Mahindra's acquisition of Mahindra Satyam was one of several technology sector deal creating work work for Am Law firms this week. In another of transaction, temporary staffing outfit On Assignment announced Tuesday it has reached an agreement to purchase information technology staffing firm Apex Systems for $600 million.

Calabasas, California?based On Assignment, which serves technology and health-care companies in the market to hire temporary workers, will pay $383 million in cash and $217 million in stock for Apex. In announcing the acquisition, On Assignment said Apex is the sixth-largest IT staffing firm in the U.S.. On Assignment also said it expects the transaction to increase the company's annual earnings starting this year. The deal, which is subject to shareholder and regulatory approvals, is expected to close in May.

On Assignment is relying on Latham as its legal adviser on the purchase. The firm's team is led by corporate partner Steven Stokdyk and corporate counsel David Zaheer in Los Angeles. Benefits partners David Taub and Laurence Seymour are also advising, as are finance partner Glen Collyer and employment law partner Joseph Farrell. Partner Pardis Zomorodi is advising on tax issues and Joshua Holian is working on antitrust matters.

Troutman Sanders is representing Richmond, Virginia?based Apex in the deal. The firm's attorneys on the deal include M&A partner Thomas Grant, private equity partner John Owen Gwathmey, corporate partner R. Mason Bayler Jr., employee benefits partner Evelyn Traub, and employee benefits of counsel Laura Windsor?all in Troutman's Richmond office. Tax partner Robert Friedman is advising in New York and employee benefits partner Tina DeNapoli is working on the deal in Atlanta.

U.K. publication Legal Week reported on another potential technology deal on Wednesday, as Windsor, Connecticut-based financial services software company SS&C Technologies entered the bidding for hedge fund administrator GlobeOp.

Last week, SS&C made an all-cash, $906.5 million offer for London-based GlobeOp. The bid topped an earlier, $805 million offer from buyout firm TPG Capital that was announced in February. SS&C has offered to pay $7.69 per share for GlobeOp?an increase of more than 11 percent over TPG's $6.89-per share proposal. GlobeOp's independent directors have withdrawn their backing for the TPG offer, and are now supporting SS&C's bid, according to SS&C's announcement.

Clifford Chance is advising SS&C on U.K. aspects of its bid, with a corporate team led by partners Steven Fox and Lee Coney. Finance partner Roderick McGillivray, regulatory partner Simon Crown, and employee incentives partner Sonia Gilbert are also advising. Meanwhile, a team from Wilmer Cutler Pickering Hale and Dorr is advising SS&C on U.S. aspects of the deal. The firm's team includes corporate partner John Burgess and finance partners John Sigel and Justin Ochs.

An Ashurst team led by corporate partners Jonathan Earle and Stephen Lloyd is representing GlobeOp in the bidding process, according to Legal Week. As we have previously reported, TPG tapped Cleary Gottlieb Steen &?Hamilton and Linklaters for counsel on its proposal.

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