Howard Kennedy LLP

Best Banking Team 2015

As a provider of legal services, combined with specialised sector knowledge, Howard Kennedy serves an international, corporate and personal client base. Clients range from national and international organisations, SMEs and owner managed businesses, family offices, entrepreneurs and their funders, and high-net worth individuals.

Its corporate department is divided into eight dedicated teams – M&A, capital markets, corporate real estate, financial regulation, intellectual property and commercial, business recovery and reconstruction, banking and tax. Michael Harris leads its dedicated M&A practice. The M&A team works closely with the other corporate teams so that it can provide the right level of skill and experience for many different types of work. For example, Harris has considerable experience of corporate real estate funding and transactions as well as in capital markets. Perhaps uniquely amongst English law firms, Howard Kennedy, through its subsidiary Howard Kennedy Corporate Services LLP, is authorised by the UK Listing Authority as a sponsor on the London Stock Exchange. Advising on the takeover of Beales One of the major deals in which Howard Kennedy has recently been involved was English Rose Enterprises’ acquisition of Beale PLC.

English Rose is an acquisition vehicle wholly owned by Portnard, which is in turn owned by Andrew and Harold Perloff and their family trusts. The family also owns a majority of AIM listed Panther Securities plc, with Andrew its Chairman. The deal followed a working relationship with Panther and the Perloff family over several years including a number of public takeovers, the last being of Airsprung Beds plc in 2011. Howard Kennedy’s involvement on the acquisition of Beales started in 2013 when Harris advised on the acquisition of shares and debt in the department store from a third party. Panther Securities was already a major shareholder and had a director representing its interests on the board. During the course of 2014 there were disagreements on the board as to the future path for the company. These disagreements resulted in Panther’s nominated director being removed. Harris and other team members were closely involved in advising on potential courses of action available during this period. Relationships between the board and its significant shareholder were therefore strained.

Beales was in need of financial support and so Portnard made a proposal to give financial assistance combined with, and conditional on, the board recommending a takeover offer by English Rose at a price less than half the then current market price. “In normal circumstances an offer of that nature would not have much of a chance in being successful,” says Harris, “but the board was compelled to recognise that the proposal was in the best interests of the company and its shareholders, and that view was endorsed by its independent financial adviser, Smith Square Partners.” Harris and Howard Kennedy’s banking team supported English Rose, and its financial advisers KPMG and Sanlam Securities throughout the transaction and, although the board was recommending the offer there was some unusually difficult discussion as to the exact language to be used.

The offer was declared unconditional in March this year. “A key part of the deal was the financial support to be provided to Beales by Portnard,” says Harris. “We worked with our dedicated banking team to resolve some interesting issues concerning the new debt’s interaction with the existing secured lender as well as advising on financial assistance issues and the need for shareholder approval. A commercial and responsive service When faced with the array of challenges that can come with any public takeover, Harris maintains that a key feature of Howard Kennedy’s service is to interact with the client from a commercial as well as a legal and time driven perspective. “Time is always critical in takeovers. Responsiveness is the key, and you need to be on the job all the time. It can be 24 hours; it can be 7 days, depending on circumstances. Being available and having the resources within your team is crucial. My focus is to contribute to the deal on a strategic and tactical level.”

Name: Howard Kennedy LLP
Address: No. 1 London Bridge
London SE1 9BG
DX 144370 Southwark 4
Telephone: 44 (0)20 3755 6000
Fax: 44 (0)20 3650 7000
Email: [email protected]

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