LAW FIRM Arthur Cox gave legal advice to both sides in the controversial Siteserv deal that has left Denis O’Brien in pole position to acquire the construction services group for €45 million.
Midway through last month, Siteserv announced that it had agreed to sell the group’s businesses to Millington, an Isle of Man company controlled by Mr O’Brien, for €45.54 million.
Since then, French group Altrad, which says it is willing to pay €60 million for Siteserv, has claimed that it was effectively shut out of the deal, as the company told it that it was not for sale. There are reports that other bidders were willing to pay more than €45 million.
It emerged yesterday that one of the Republic’s biggest commercial law firms, Arthur Cox, acted for Siteserv and Millington in the deal.
The firm is a long-time adviser to Siteserv, but Mr O’Brien’s company specifically asked that it be represented by one particular Arthur Cox partner.
The law firm referred the matter to an internal committee that deals with conflict of interest issues. It gave the go-ahead to act for both sides, but the clients had to agree to a number of terms and conditions. One of these was that, in the event of a dispute, Mr O’Brien’s firm would have to recruit another law firm to advise it.
Shareholders will get an opportunity to vote on the deal at an extraordinary general meeting in Dublin on Thursday.
Siteserv shareholders, including chief executive Brian Harvey, Chris Neate and John Neal, will receive €5 million. The remaining €40 million will go to the Irish Banking Resolution Corporation – formerly Anglo Irish Bank – in full settlement of the €150 million due to it from the company, which means it is taking a 74 per cent haircut on the loan.
Siteserv’s board issued a statement saying that it believes the disposal of the business to Millington represents the best price and conditions for such a deal.
“They are satisfied that the process was conducted in the best interest of the shareholders and stakeholders of the company as a whole, and have recommended shareholders to vote in favour of the proposed disposal at the forthcoming egm,” the statement noted.
It also pointed out that more than 67 per cent of shareholders had already confirmed their support for the deal through irrevocable undertakings and proxies. The transaction needs 75 per cent support to go through, as it is an extraordinary resolution.
Siteserv’s advisers, Davy and KPMG, managed the process for the company. This was narrowed down to 12 expressions of interest, which was, in turn, narrowed down to two. Millington emerged as the best bid in that process.
