Year Review Outlook 2021 - in - Latham & Watkins LLP
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Year in
Review
and
Outlook
2021
Germany
Tier 1 Rankings Executive Summary
2020 will be remembered as a tumultuous year for the German and
Europe global markets, with the COVID-19 pandemic intensifying an already
uncertain economic and geopolitical environment. However, as
this report demonstrates, the German business world has shown
#1 Europe M&A by Volume
Bloomberg
great resilience in the face of unprecedented headwinds.
At Latham, we partnered with clients to develop creative solutions as they
#1
navigated some of the year’s largest and most challenging German deals. We
Europe PE by Value thank our clients for their continued trust and valued role in the Latham community.
Bloomberg
This report evaluates key developments in the German market in 2020, while also
#1
EMEA Corporate High Yield Bonds (inc exploring anticipated legal and business trends in the year ahead. Our analysis
EM) Legal Adviser – Combined Issuer and provides insight into the state of M&A and private equity, with a focus on evolving
Manager by Deal Count and Volume deal strategies such as spin-offs, carve-outs, and distressed divestments.
We take a close look at some of the most active sectors in the German and
international markets, including life sciences and technology. Our lawyers also
address pertinent topics in litigation, such as collective redress and US white
Germany collar enforcement. By covering a range of topics, we hope to provide you greater
clarity in a fast-changing and challenging business environment.
#1 JUVE (8x)
We appreciate the opportunity to serve and support you, and look forward to our
continued work together.
#1 LEGAL 500 (9x) Sincerely,
Burc Hesse | Tobias Larisch
Contents
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Strong 2021 Deal Pipeline For German M&A and
Private Equity Market
How will StaRUG help German companies address
the impact of COVID-19?
Energy and Infrastructure in Germany Sustains
Momentum Despite Challenges
Healthcare and Life Sciences Trends to Watch in 2021
German Tech Sector Increasingly Attractive
for M&A and PE Investment
Collective Redress Set to Redefine Litigation Across Europe
Are Changes in Store for US White Collar Enforcement?Strong 2021 Deal Pipeline For German M&A and
Deal Highlights Private Equity Market
CPPIB The German M&A/PE market was off to a good start in 2020, but then
the COVID-19 pandemic hit, unsettling the market and leaving many
Advising CPPIB on a co-investment with KKR in
the P2P of Axel Springer market participants to wonder whether we were going to face a situation
Dr. Nikolaos Paschos, Mike Bond, comparable to the financial crisis in 2007, when there was a shutdown in
Sebastian Goslar, Dr. Jana K. Dammann de Chapto the capital markets and M&A dropped precipitously.
Triton When business went largely virtual in 2020, so did M&A activities. While there was a significant
slowdown in the second and third quarters in M&A/PE activities, no drop-off happened
Advising Triton on the acquisition of the Renk
Group and high yield bond financing
comparable to the one in 2007. According to Refinitiv’s Global Mergers & Acquisitions Report,
Dr. Rainer Traugott, Dr. Rüdiger Malaun,
in terms of deal value, there has even been an increase in announced M&A transactions with
Dr. Alexander Lentz German involvement of 18% compared to 2019 (while the number of transactions was indeed
lower than in 2019 due to the slowdown in the second and third quarters). The German M&A/
PE market has hence proved to be resilient despite the challenges resulting from the pandemic,
Siemens Healthineers
and private equity’s share in German M&A deals even increased compared to 2019.
Advising Siemens Healthineers on acquisition of
Varian, capital increase for acquisition financing In terms of deal volume, three transactions involving German market participants stood out
and in securing CFIUS clearance in 2020.
Charles Ruck, Dr. Rainer Traugott, Joshua Dubofsky, Dr.
Oliver Seiler, Les Carnegie, Rachel Alpert > CONTINUE READING
Ardian
Advising Ardian and other sellers on the sale of
Competence Call Center Group (CCC) to TELUS
International, deal value: € 915 million
Burc Hesse, Dr. Sebastian Pauls, Stefan Süß,
Dr. Max Hauser, Prof. Dr. Thomas GrütznerHow will StaRUG help German companies
Deal Highlights address the impact of COVID-19?
Leoni AG Looking back at the last few months, the COVID-19 pandemic has hit
many companies hard and amplified disruptive trends in various sectors.
Advising Leoni AG on reorganization of its dept
exposures and within the scope of its ongoing In addition to other measures to address COVID-19 impact on businesses,
restructuring Germany has made significant progress toward international best practices
Dr. Jörn Kowalewski, Alexandra Hagelüken, Adam Goldberg for restructuring: StaRUG — known as the German scheme — came into
effect on 1 January 2021, as one of the most modern restructuring laws in
TUI Group the world. But how will StaRUG help German companies survive the crisis
and what if insolvency is unavoidable?
Advising a consortium of banks on the provision
of a credit line of €1.8bn (April 2020) and on the
additional provision of a credit line of €1.2bn What does the German market currently look like?
(August 2020) for TUI Group by German state-
owned development bank KfW Frank Grell: When we look back at the last few months, the COVID-19 pandemic has created
Alexandra Hagelüken, Sibylle Münch, Frank Grell a truly unprecedented set of challenges for the economy and society at large. Despite the
drastic policy responses in financial aid, the crisis has hit many companies hard. For example,
in the automotive and engineering industries, the COVID-19 crisis has exacerbated the already
Tom Tailor GmbH tense situation that arose from the diesel crisis and the government’s lack of a coherent and
Advising bank consortium on federal and state sustainable mobility strategy.
guaranteed loan financing for Tom Tailor GmbH
Nils Röver: COVID-19 has also amplified disruptive trends in other sectors. The fashion and
Frank Grell, Sibylle Münch
retail industry, for example, faced changes in consumer behavior before the pandemic. The
number of restructurings in these industries has risen throughout the year. However, we are far
Benteler Group from seeing the wave of restructurings and insolvencies some commentators expected. The
temporary suspension of the obligation to file for insolvency until January 2021, coupled with
Advising the steering committee of the credit financial aid, has helped fashion and retail companies stay afloat.
financiers of the Benteler Group on the now
completed full refinancing, which is part of a
fundamental restructuring of Benteler Group > CONTINUE READING
Dr. Jörn Kowalewski, Dr. Hendrik HaukeEnergy and Infrastructure in Germany Sustains
Deal Highlights Momentum Despite Challenges
EQT Infrastructure and OMERS The energy and infrastructure sectors continue to experience transformative
changes at a high pace, a trend that Latham expects to sustain momentum
Advising EQT Infrastructure and OMERS on the
acquisition of Deutsche Glasfaser from KKR for the foreseeable future.
Infrastructure and Reggeborgh
Dr. Rainer Traugott, Dr. Nils Röver Energy Sector
The global mega-trend of decarbonization had repercussions in Germany in 2020, most
Siemens AG prominently displayed by the “Coal Exit”. In July 2020, the German federal government passed
Advising a bank consortium on the planned legislation to end coal-fired power generation in Germany by 2038, and a decommissioning
listing of Siemens AG’s energy division on schedule for individual lignite power plants was agreed. For utilities, the legislation entailed
the regulated market (Prime Standard) of the challenging negotiations with the German federal government to reach agreement on the terms
Frankfurt Stock Exchange of this phase-out (previously covered in this Latham post). The Coal Exit will likely continue
Dr. Oliver Seiler, Dr. Rainer Traugott to accelerate the energy transition, with an ever-increasing share of renewables in the overall
energy mix.
Allianz Capital Partners In 2020, hydrogen became the energy buzzword given its potentially key role in the global
push to produce carbon-free energy. A wholesale shift to clean hydrogen could remove carbon
Advising Allianz Capital Partners in its joint
venture with Telefónica from the electricity system, which is currently responsible for around a quarter of the world’s
Burc Hesse, Dr. Sebastian Pauls, Dr. Tobias Larisch, annual 33 gigatonnes of carbon dioxide emissions. A hydrogen shift could also help clean up
Michael Esser, Conrad Andersen, Stefan Süß transport and heavy industry, which account for the bulk of other global emissions. However,
the opportunities around hydrogen would also require coordinated policy, lower hydrogen
production costs, and massive growth of renewable energy source.
BayWa AG
Advising BayWa AG on the capital increase at > CONTINUE READING
the level of its subsidiary BayWa r.e. renewa-ble
energy GmbH
Dr. Rainer Traugott, Dr. Stephan Hufnagel, Dr. Tobias
Larisch, Dr. Nils RöverHealthcare and Life Sciences Trends to Watch
Deal Highlights in 2021
The healthcare and life sciences (HCLS) sector remained particularly active throughout
Rhön Klinikum 2020. Despite the COVID-19 pandemic, deal activity was very strong in the first half of the
Advising Rhön Klinikum AG on € 1.3 bn year — with notable transactions including Asklepios’ US$1.3 billion takeover of listed Rhön
take-over by Asklepios Klinikum AG. The second half of the year saw continued deal activity in HCLS, including
Dr. Henning Schneider, Dr. Andreas Lönner Siemens Healthineers US$16.4 billion acquisition of Varian and the sale of German-Spanish
pharmaceutical producer Neuraxpharm.
Berenberg Bank
International players have shown increasing interest in HCLS — including, in particular, major
Advising Berenberg Bank as Sole Global private equity investors. This trend, which was evident before the outbreak of COVID-19, has only
Coordinator and Sole Bookrunner on the IPO
accelerated during the pandemic, due to the disproportionately large impact the virus has had on
of PharmaSGP Holding SE
certain other sectors of the economy (e.g. Logistics, Real Estate, Automotive, Hotels/Traveling).
Cheplapharm Major hospital and nursing home operators, telehealth, online pharmacies, lab diagnostics, and
similar services are likely to see continued increased investor focus also in 2021. Acquirers will
Advising Cheplapharm on the acquisition of also place increasing importance on scalable internet-driven business models.
a product portfolio from LEO Pharma and a
portfolio from Takeda as well as on high yield
bond issues (January 2020 and November 2020) > CONTINUE READING
Christoph Engeler, Dr. Tobias Klass, Dr. Susan Kempe-
Müller, Dr. Rüdiger Malaun, Dr. Alexander Lentz
EQT VIII
Advising EQT VIII funds on financing
arrangements to enter into exclusive negotiations
for the acquisition of Schülke & Mayr GmbH
Dominic Newcomb, Thomas Weitkamp
Novo Holdings A/S (Copenhagen)
Advising Novo Holdings A/S (Copenhagen) on
the increase of its anchor stake in Evotec AG,
acquired in February 2017
Dr. Henning Schneider, Dr. Dirk Kocher,
Dr. Jana Dammann de ChaptoGerman Tech Sector Increasingly Attractive for
Deal Highlights M&A and PE Investment
Ardian With virtual connectivity on the rise, the tech industry has seen an
increase in dual- and tri-track M&A processes, as well as in private equity
Advising Ardian on the acquisition of a majority stake
in Swissbit Holding AG and Ardian/Swissbit on the investments.
subsequent acquisition of the Hyperstone Group
Burc Hesse, Dr. Sebastian Pauls 2020 was a year in which technology facilitated rapid changes in how people work and live.
Despite fewer M&A megadeals and a lower volume overall, tech stood out as an increasingly
Hg active and competitive sector that is poised to see further growth in investment activity, particularly
as companies look to upgrade their capabilities and offerings by harnessing technology. Several
Advising Hg on the acquisition of a majority
notable M&A transactional trends emerged in 2020, including a rise in dual-track and even tri-track
stake in F24
processes. Growth equity also rose significantly as Europe’s startup scene further matured. Amid
Oliver Felsenstein
these developments, key IP and privacy questions have arisen for businesses in the digital sector
to consider, including those surrounding artificial intelligence (AI).
Alcentra Limited and Deutsche Bank AG
Advising Alcentra Limited and Deutsche Bank AG > CONTINUE READING
on the financing of the acquisition of con-gatec
Holding AG by DBAG Fund VIII
Thomas Weitkamp, Alexandra Hagelüken,
Dr. Christian Jahn
Allgeier SE
Advising Allgeier SE on the spin-off of 100
percent of the global technology consulting and
software development business bundled in the
Nagarro Group and the related listing of Na-garro
SE (“Spin-off”)
Dr. Oliver Seiler, Dr. Nikolaos Paschos
TeamViewer
Advising TeamViewer on the acquisition of Xaleon
Dr. Nikolaos Paschos, Christina MannEU-Wide Collective Redress Collective Redress Set to Redefine Litigation
Regime Across Europe
Recent developments in the area of collective redress will redefine the
litigation landscape in Germany and throughout Europe.
The EU has adopted a new collective
redress regime that will redefine the litigation Mass actions have been on the rise throughout Europe for some time. In 2020, the balance
landscape in Germany and throughout Europe. clearly tipped towards a more plaintiff-friendly environment. Most importantly, the EU passed
a new directive on representative actions that will implement an EU-wide collective
redress regime.
Here is what to expect.
Traditional mass actions have spiked, too, and a particular area of focus for many companies should
be GDPR-related claims, a segment of the market that saw a number of troublesome judgments in
2020. Finally, legal tech companies and litigation funding received a big boost from the German
Federal Court of Justice (FCJ), and now the German lawmakers is getting involved.
> CONTINUE READINGAre Changes in Store for US White Collar
Enforcement?
Recent developments include updated DOJ compliance guidance, a
continued rise in FCPA proceedings and penalties, and new investigatory
approaches in light of the pandemic.
2020 saw many important developments in US white collar enforcement, driven by
Administration priorities, business trends and practices, and the realities of COVID-19. The
legal and business communities paid particular attention to the US Department of Justice’s
(DOJ’s) updated guidance on “Evaluation of Corporate Compliance Programs,” the growing
number of contentious Foreign Corrupt Practices Act (FCPA) proceedings (matched
by significant penalties), and the impact of the COVID-19 pandemic on investigative
strategies by regulators and corporate compliance programs. Now, with the United States
transitioning to a new administration, it is yet to be seen whether these trends will continue
and what other changes may be in store.
DOJ’s Updated Guidance on Evaluation of Corporate Compliance Programs
The DOJ issued a number of updates to its guidance in recent years, providing companies
and the defense bar with additional transparency into the US government’s priorities and
expectations. In 2020, the DOJ and US Securities and Exchange Commission (SEC)
issued an updated FCPA Resource Guide (which largely codified well-established policy,
case law, and enforcement updates); and in June 2020 the DOJ issued updated guidance
for prosecutors evaluating corporate compliance programs. The updated guidance includes
the following key enhancements and clarifications.
> CONTINUE READINGContacts
Dr. Christoph Baus Dr. Tobias Larisch
Partner | Litigation Partner | Corporate/M&A
Dr. Jana K. Dammann de Chapto Dr. Nikolaos Paschos
Counsel | Antitrust Partner | Corporate/M&A
Christoph Engeler Stefan Patzer
Partner | Corporate/M&A Counsel | Litigation
Alice Fisher Dr. Nils Röver
Partner | White Collar Partner | Private Euqity
Frank Grell Dr. Henning Schneider
Partner | Restructuring Partner | Corporate/M&A
Prof. Dr. Thomas Grützner Pia Sösemann
Partner | White Collar Associate | Corporate/IP
Burc Hesse Tim Wybitul
Partner | Private Equity Partner | Data Privacy
Dr. Susan Kempe-Müller
Partner | Corporate/IP
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