Sep 10, 2008

Cleary Gottlieb is representing Commerzbank with respect to the U.S. regulatory aspects of Commerzbank's acquisition of Dresdner Bank and the simultaneous investment in Commerzbank by Allianz. The transaction is set to be Germany’s largest banking takeover in recent years.

Sep 22, 2008

Cleary Gottlieb is representing Deutsche Postbank in Deutsche Post’s €2.79 billion sale of a 29.75% minority stake in Postbank to Deutsche Bank. The transaction is expected to close in the first quarter of 2009.

Deutsche Bank, which has 14 million clients in private and business banking (of whom 9.7 million are in Germany), and Postbank, which has 14.5 million clients in Germany, have also agreed to cooperate in several areas including the distribution of home finance and investment products.

With 14.2 million active domestic customers, approximately 21,000 employees and total assets of €229 billion, Deutsche Postbank is one of Germany’s major financial services providers.

Cleary Gottlieb has previously represented the Deutsche Postbank in several important transactions such as in its IPO in 2004, and its takeover of BHW Holding AG in 2005.

Jun 15, 2007

Cleary Gottlieb represented Deutscher Sparkassen- und Giroverband ö.K. (the German Savings Banks Association widely known as DSGV) in its acquisition of the State of Berlin’s 81% share in Landesbank Berlin Holding AG and NORD/LB’s 10% Landesbank stake. Cleary Gottlieb also represented DSGV in the acquisition financing, which came from a consortium of WestLB, NORD/LB and Sachsen LB.

The deal was signed on June 15, and is awaiting the approval of Berlin’s Parliament and clearance by regulatory authorities.

The fiercely contested acquisition (which at one point involved some 19 bidders, including both private equity buyers such as Cerberus, Lonestar and JC Flowers, and banks like Commerzbank, HVB/Unicredit and German Landesbanken) was headline news in Germany, and is one of the largest domestic deals on record in the German finance sector.

Landesbank Berlin, previously known as Bankgesellschaft Berlin, nearly collapsed in 2001, when a revaluation of its real estate-related liabilities wiped out its capital. The European Commission had approved a € 23 billion bailout by the State of Berlin, on the condition that it divest its stake by the end of 2007. The Commission monitored the auction process closely to ensure that it was open, transparent and non-discriminatory.

DSGV indirectly represents more than 400 German savings banks, one of the largest groups of financial institutions of the world. These banks serve almost 50 million customers in Germany, among them 1.9 million customers in Berlin.

Feb 19, 2008

Cleary Gottlieb successfully represented a German investor in a test case before Germany's Federal Fiscal Court, the highest German tax court, regarding the taxation of so-called index certificates with a partial repayment guarantee (i.e., 10%). The German Federal Finance Ministry, which participated in the court proceedings, had previously issued a circular according to which even the guarantee to repay only a small part of the issue price causes all of the capital gains realized from the sale of the certificates to constitute taxable income to private investors. The Federal Fiscal Court, however, held that 90% of the gain, (i.e., the portion of the gain that can be allocated to the non-guaranteed part of the issue price), is generally exempt from German income tax. Index certificates with small capital guarantees were issued in the late 1990s to comply with stock exchange requirements at the time. The landmark decision of the Federal Fiscal Court resolves the long-term uncertainty troubling investors holding index certificates.

Jun 01, 2008

Cleary Gottlieb represented the initial purchasers, led by Banc of America Securities LLC, Deutsche Bank Securities Inc., Goldman, Sachs & Co. and J.P. Morgan Securities Inc., in the Rule 144A/Regulation S offering by E.ON International Finance B.V. of U.S. $2 billion in aggregate principal amount of 5.80% Senior Notes due 2018 and U.S.$1 billion in aggregate principal amount of 6.65% Senior Notes due 2038. The Notes have unconditional Guarantees from the issuer’s parent company, E.ON AG. The offering, one of the largest debt offerings by a European corporate issuer since the onset of the credit crunch, priced on April 15 and closed on April 22.

The offering was E.ON’s first major U.S. capital markets deal and represents a major step in E.ON’s realization of a €60 billion investment program originally announced in 2007. E.ON is a leading European electricity and gas company and the largest industrial company in Germany based on market capitalization. The deal featured an innovative structure in which the Notes and Guarantees are governed by New York law, while the underwriting arrangements are subject to German law. The on-going turmoil in the international credit markets posed significant additional challenges for everyone involved in the deal.

Sep 25, 2007

Cleary Gottlieb represented Axel Springer AG in its successful challenge in the German Federal Court of Justice, Germany's highest appellate court for civil and criminal cases, of an earlier decision of the Düsseldorf Court of Appeal. On September 29, 2006, the Court of Appeal rejected as inadmissible an appeal brought by Axel Springer against a decision of the Federal Cartel Office prohibiting Axel Springer's planned merger with ProSiebenSat.1, finding that the appeal had become moot following the parties' decision to abandon the transaction. Nonetheless, the Court of Appeal allowed a further appeal to the Federal Court of Justice on points of law.

On September 25, 2007, following a two-hour hearing, the Federal Court of Justice granted Axel Springer's appeal, annulled the Court of Appeal's decision and remanded the case. Axel Springer argued that its appeal was admissible because the FCO's prohibition decision would stand in the way of any fresh attempt to acquire ProSiebenSat.1 and preclude Axel Springer from re-negotiating any such deal, arguments the Federal Court of Justice followed. The previous case law left insufficient room for judicial review, and the European Courts allow appeals in comparable cases.

The Court of Appeal will now review the matter on the merits to decide whether the FCO's prohibition was justified, in particular whether the concentration resulting from the proposed merger would have reinforced existing dominant positions on the market for TV advertising and on newspaper markets. Axel Springer is convinced that the FCO erred in prohibiting the merger, which involved no horizontal or vertical issues, notably because it made an insufficient analysis of conglomerate effects.

Aug 17, 2007

Cleary Gottlieb represented The Coca-Cola Company and its German affiliate, Coca-Cola Erfrischungsgetraenke AG, in the takeover of 18 independent Coca-Cola distribution companies and in their merger with several independent German bottlers into one company. The combined entity shall serve the entire country effective September 1.

The merger establishes a company of 12,000 employees with an annual sales volume of 3.5 billion liters.