The IFLR Middle East Awards showcase regional legal innovation of the highest caliber. This year, we are please to have been shortlisted for five awards, two of which have been outlined below:
Equity Deal of the Year – Americana Restaurants dual listing IPO
The transaction was an initial public offering of 30% of Americana Restaurants International Plc’s total issued share capital. This was the first-ever concurrent dual listing on the Abu Dhabi Securities Exchange (“ADX”) and the Saudi Stock Exchange (“Tadawul”).
- The transaction established several firsts including providing the first company to execute a concurrent offering and dual listing on the Tadawul and the ADX.
- The initial public offering was 65.5 times oversubscribed, while subscriptions from individuals in the UAE and Saudi Arabia exceeded 48.2 times and 2.8 times.
- As the transaction involved entities in other GCC countries, the transaction requires taking into account the various legal and other considerations applicable in such jurisdictions.
- This a high value transaction with an estimated deal value of about USD 1.8 Billion, making it one of the most significant capital markets transactions in the region.
- Innovation and creativity was required to execute a seamless transaction which takes minority shareholder protections into account.
ASAR advised on the pre-IPO Kuwait aspects of the transaction, including:
- Conducting due diligence on Americana Group’s Kuwaiti entities to determine possible risks to identify in the prospectus as well as mitigation measures.
- Advising on the restructuring of the Group, including the steps and corporate approvals required to transfer the Kuwait restaurants business from the parent company (Kuwait Food Company Americana KSCC) to the Issuer.
- General Kuwait law advice on the distribution of shares to shareholders who could not be found.
- Advising on a dividend in specie procedure for the parent company whereby dividends in the parent company where distributed as shares in the Issuer.
Meet the lawyers involved:
The transaction was a cross border share swap acquisition of the entire share capital of Ahli United Bank B.S.C, a Bahrain established bank, by Kuwait Finance House K.S.C.P. The acquisition created the largest Islamic finance banking entity in the world in terms of assets and is the highest value M&A deal in Kuwait and one of the very largest in the GCC.
- The transaction required approval of multiple regulators including the Central Bank of Kuwait, the Central Bank of Bahrain and the Capital Markets Authority of Kuwait. Accordingly, the deal structure had to be devised, taking into account the uncertainties around regulatory approvals.
- The parties are listed entities and our client has listed subsidiaries, which further complicated the deal structure in consideration of special permissions surrounding due diligence, disclosure requirements and trading blackout periods.
- A deal of this size and structure was unprecedented in Kuwait and Bahrain hence requiring innovation to overcome areas where no clear regulations apply and there are no practical precedents.
- The transaction is noteworthy because it is a multi-jurisdictional transaction that involved navigating and taking into accounts the laws of at least two jurisdictions in which the borrower group companies are located.
- The transaction involved an Islamic Bank acquiring a conventional bank, which required careful consideration of immediate and future structuring requirements to comply with Shari’ah rules.
Our role included the following in Kuwait and Bahrain:
- conducting due diligence on the purchaser (in light of the share swap structure);
- advising on Shari’ah implications to our client in connection with the takeover, including Shari’ah wrapping of derivatives;
- providing input on target corporate authorisations and other documentary requirements for execution of the transaction, including the offer/public disclosure documents;
- drafting, reviewing and finalising board circulars and subscription forms;
- advising on all regulatory approvals required and procedures to be followed by the Client in relation to the transaction (as applicable to Kuwait and Bahrain); and
- Liaising with the relevant regulatory authorities to implement the transaction (including preparing and submitting any required documentation to the regulators) for squeeze-out, encumbrances on surrendered shares and cross-listing requirements.
Meet the lawyers involved:
Along with the two above mentioned deals, we are humbled to have been nominated for National Law Firm of the Year – Kuwait, and for National Law Firm of the Year – Bahrain.
Wishing all shortlisted candidates the best of luck!