Sidley represented client Aboitiz Equity Ventures (AEV) in a joint venture with Irish building supplies group CRH Plc to acquire substantially all of Lafarge’s cement and building materials business in the Philippines for approximately US$1.3 billion. AEV is the publicly listed holding and investment arm of the Aboitiz Group.
“This was a complex, cross-border M&A auction, and the Lafarge Philippine assets formed a key part of the global asset portfolio divested as part of the LafargeHolcim merger. Lafarge ran parallel auctions at both the country levels and global levels, and while it ultimately awarded the global portfolio to CRH, AEV was best positioned as the local partner having regard to its leading market position in the Philippines and its experience in M&A and large, complex transactions,” said Nicholas Grambas, partner and global co-leader of Sidley’s Project Finance and Infrastructure group. Grambas led the Singapore-based team, which included associate Gmeleen Tomboc.
The deal will allow AEV to diversify its business model by creating infrastructure as its fifth core business line in addition to power, banking, food and real estate. The deal is a reflection of the recent growth that is reshaping the economic landscape of the Philippines. The country’s resurgent economy, coupled with burgeoning investment in transportation infrastructure and power and renewable projects, has continued to drive increased demand for cement and aggregates.
The Sidley team’s experience in international and regional cross-border M&A, together with its experience in competitive auctions, assisted AEV in structuring and executing the deal and managing the multi-stakeholder dynamic. While the deal had a number of challenges, the unexpected introduction of the Philippine Competition Act after contractual close required a strategic approach to ensure a smooth closing. The deal successfully closed, as planned, in September 2015.
“Our team brought a combined understanding of the commercial drivers and experience needed to help structure, navigate and execute the deal effectively for AEV. This is what we do best—we understand what it takes to ‘get the deal done’ for our clients,” Grambas said.
Sidley has maintained on-the-ground capabilities in the Asia Pacific region for more than 30 years. Our Project Finance and Infrastructure lawyers handle a range of transactions for clients operating across many industries, including power, alternative energy, infrastructure, oil and gas, pipelines, telecommunications, mining and resources.