Leading global law firm Baker McKenzie advised Firmenich International SA, a global leader in the Flavor and Fragrance industry, on its successful debt financing for the acquisition of Les Dérivés Résiniques et Terpéniques ("DRT").
A Baker McKenzie finance team led by partner Geoff O'Dea and senior associate Nick Cusack, with Teresa Ryan and Roma McCool assisting (all London) advised on the acquisition financing structure, the provision of multi-billion investment grade bridge-to-bond and revolving credit facilities. Finance partner Michael Doran and senior associate James Tanner, with Oliver Jackson assisting (all London), led on the successful debut EUR 1.5 billion senior eurobond comprising dual tranche 6.5 and 10 year maturities. Citigroup and UBS Investment Bank acted as joint global coordinators and joint bookrunners with respect to the Eurobond offering
This senior bond was rapidly followed by Michael, James and Oliver advising Firmenich on its re-opening the European hybrid bond space (closed since the onset of the Covid-19 pandemic) with a benchmark offering of EUR 750 million Deeply Subordinated Resettable Perpetual Notes with a 5.25-year non-call period and an initial coupon rate of 3.75 percent. Citigroup and UBS Investment Bank acted as joint global coordinators, joint structuring advisers and joint bookrunners, with Credit Suisse and Goldman Sachs International acting as co-managers. S&P gave the hybrid bond 50 per cent equity credit.
The net proceeds of the overall debt raising are being used to finance the acquisition of DRT in France from Ardian, Tikehau Capital and family shareholders ‒ a deal completed on 28 May 2020. DRT is a world leader in the development and supply of high quality, renewable and naturally-derived ingredients. Baker McKenzie supported Firmenich’s in-house legal team on this complex cross-border transaction sequence, led by Jane Sinclair (General Counsel) and Adam Shelley (M&A), and collaborating with French and Swiss counsel from Bredin Prat and Homburger.
Adam Shelley of Firmenich commented: "When contemplating significant transactions it is important to pick partners who are pragmatic, collaborative and able to take a strategic view across the capital structure. The Baker McKenzie team not only performed under pressure but were also a pleasure to work with.”
Geoff O'Dea commented on the deal: “We are very pleased to have helped Firmenich achieve its targeted acquisition debt financing, particularly given the challenging market conditions around us today. Managing the international elements of the corporate and finance workstreams during unprecedented disruption was testament to the strength of the business and the strength of team that came together on the transaction."
Michael Doran continued: "It has been a great pleasure to work on this high-profile transaction with the Firmenich team. We are pleased to support complex transactions during challenging circumstances. This is a great example of our acquisition focused bridge to bond platform and it was great to top the whole deal off with a landmark hybrid bond issue."