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Warner Norcross taps TerraLex for $500M acquisition
Warner Norcross worked with law firms in 22 foreign countries earlier this year to complete a $500 million acquisition on behalf of Toronto-based CCL Industries.
CCL Industries, a global specialty packaging and label company, acquired two divisions of the California-based company Avery Denison: its Office & Consumer Products division and its Designed & Engineered Solutions division.
The divisions included operations in 23 countries, including the U.S., which required Warner to work with law firms in each country to complete the acquisition.
“We were able to do the deal because of our involvement in this organization called TerraLex,” said Mike Jones, a partner at Warner Norcross. “TerraLex is a worldwide consortium of independent law firms.”
Warner has been a member of TerraLex since 1995. TerraLex was established in 1990 and includes more than 150 independent law firms in 44 states and 100 countries around the globe.
“What that network allows its member firms to do is to develop deep relationships with the members so we can be comfortable with law firms in different countries and jurisdictions,” Jones said.
He noted that, without the network, Warner would have had to basically cold-call firms in each country to ask for assistance on the acquisition.
TerraLex membership requires law firms to meet specific criteria and includes a yearly review to ensure the firms are continuing to meet those standards.
“You have to be invited to be a member of TerraLex and you have to be recognized as a leader in your jurisdiction — as one of the top firms in your jurisdiction,” Jones said.
He said the 22 law firms assisted throughout the more than seven-month period it took to close the deal, from implementing the deal under each country’s laws for the transferring of assets and stock, to navigating environmental, labor and other laws.
There were also several patents and trademarks that needed to be transferred as part of the pact.
“The transaction structure was unique because usually you have a buyer buying either assets or stock, or there would be a merger,” Jones said. “This transaction was a hybrid. We bought assets in certain jurisdictions and we bought stock in other jurisdictions.
“So they helped draft and negotiate all those ancillary documents that effectuated the transfer, and then they helped with all the other specialty areas.
“One of the main differences between the U.S. and the rest of the world is employment. The rest of the world is pretty strict on employment issues. A lot of countries require advanced notification in connection with a merger or acquisition. Having local counsel tell us all the rules surrounding employment issues was a big part of their task.”
More than 20 Warner attorneys and paralegals were involved in the project, representing several practice areas including antitrust, financing, real estate, employment and environmental.
Jones said the project required a lot of communication and coordination, and the time difference of the various countries was just one of the challenges.
“Coordinating the closing is difficult with that many jurisdictions,” he said. In fact, the closing call took place at 2 a.m. for the Warner attorneys.
In September, Warner was recognized by TerraLex as its Deal of the Year winner during its global meeting held in Paris.