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Osler tops corporate transactions to date in 2006

|Written By Beth Marlin

During the first half of 2006, Osler Hoskin & Harcourt LLP has emerged as Canada's leading corporate stickhandler as counsel of record on 28 newly announced deals valued at more than US$31.5 billion.

Rob Yalden says there's been a marked acceleration in the number of domestic corporate deals this year.
Nipping at Osler's heels is Blake Cassels & Graydon LLP.

Still, no one's shedding any tears for the country's other national law firms, which are also frenetically busy during the latest merger and acquisition wave.

According to Rob Yalden, a partner with Osler's Montreal office and co-chairman of the firm's mergers and acquisitions group, there's been a marked acceleration in the number of domestic corporate deals, with transactions jumping to about 1,000 in 2005, from the usual 850.

"We see this trend even more pronounced in the first quarter of 2006, where there were more than 400 transactions," says Yalden. "If that pace continues, 2006 will be substantially ahead of 2005."
The fees these firms command, while not public, are not small. In many cases, large legal teams of lawyers, each billing as much as $800 an hour, represent numerous parties.

On the hotly contested $40-billion Teck Cominco-Falconbridge-Inco transaction alone, fees for the five Canadian law firms involved — Osler Hoskin & Harcourt LLP for Inco Ltd.; Heenan Blaikie LLP for Phelps Dodge; McCarthy Tétrault LLP for Falconbridge; Davies Ward Phillips & Vineberg LLP for Xstrata; and Lang Michener LLP for Teck Cominco — are expected to exceed $30 million, say lawyers.

"I'd say [Teck-Falconbridge-Inco] is now the top deal in 2006. Everyone in the securities law field here in Canada is taking a very keen interest in how that is all going to play out," says Sheila Murray, a lawyer with Blake Cassels, counsel to financial advisers to Teck Cominco. "I don't think we've ever seen before a situation in which hostile offers were made on two parties that were trying to combine themselves."

One lawyer involved in another of the top Canadian deals, who spoke on condition his name not be used, says the top transactions are worth millions to the law firms representing the key players.

"All of these major takeover bid matters have multimillion-dollar fees involved. You take any of the deals on your list. A multibillion-dollar deal — it's not unusual to see legal fees on a major deal for one side of $2 or $3 million," he says. "That's a very good deal, but these things are time-intensive, particularly if you get into the hostile territory. You keep track with the hourly fee, but you're basically getting your top rate. At the top, it's $750 to $800."

According to lawyers interviewed by Law Times, the other most significant ongoing or recently closed deals include:

- Hudson's Bay Co.'s takeover by U.S. billionaire Jerry Zucker's Maple Leaf Heritage Investments Acquisition Corp. for $860 million in March. Hudson's Bay in Canada was represented by Blake Cassels; Zucker was represented by Torys.

- BCE's $8.5-billion Aliant Trust spinoff, which involved Blake Cassels and Atlantic Canada's Cox Hanson O'Reilly Matheson for Aliant, and Stikeman Elliott  LLP for BCE. "It's a fascinating deal – creating an $11 billion corporation, and it's got everything; it brings in every skill that a firm like ours has," says Blake Cassels' Murray.

- Arcelor's $56-billion takeover bid of Dofasco shares on March 8. Arcelor was represented by Ogilvy Renault; Dofasco was represented in Canada by Fasken Martineau DuMoulin LLP; ThyssenKrupp was represented by Osler; and Mittal was represented by Stikeman Elliott.

- Barrick Gold acquires Placer Dome. On February 6, 2006, Barrick Gold Corp. announced that it had taken up and accepted for payment in the aggregate approximately 94 per cent of the outstanding shares of Placer Dome Inc., and that it would proceed to acquire 100 per cent of Placer Dome pursuant to a compulsory acquisition transaction. The acquisition makes Barrick the largest gold producer in the world. Representing Barrick Gold was Davies Ward; Placer Dome was represented by Osler; and Goldcorp by Cassels Brock & Blackwell LLP

- Ameritrade's acquisition of TD's U.S. brokerage business. On Jan. 24, Ameritrade Holding Corp. and Toronto-Dominion Bank closed a transaction whereby Ameritrade acquired TD's U.S. brokerage business, TD Waterhouse USA, in a deal worth US$2.9 billion. In Canada TD was represented by Osler and Ameritrade by Stikeman Elliott.

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