15 May 2006
Sydney, 15 May 2006: National law firm Clayton Utz has helped to lead ASX-listed fertiliser company Incitec Pivot Limited into a new era, following the highly successful institutional sell-down of part of majority shareholder Orica Limited's 70 per cent stake in the company and proposed buy-back by IPL of Orica's remaining shareholding.
The separation of IPL from explosive and chemicals business Orica to become a fully independent entity has been achieved through Orica's institutional placement of 56.5 per cent of its shareholding and IPL's proposed selective buy-back of Orica's remaining 13.5 per cent stake, all at A$21 a share. The placement, which netted sale proceeds of A$692 million, was underwritten by Macquarie Equity Capital Markets.
Clayton Utz put together a specialist team drawn from across its Melbourne practice to advise IPL on this complex deal, which required consideration of a number of commercial, funding and financial structuring issues.
Corporate partner Charles Rosedale led the firm's team, working with senior associate Brendan Groves and solicitor Jessica O'Hara in advising IPL on the sell-down and also on the proposed share buy-back (still subject to shareholder approval).
In relation to the separation arrangements, corporate partner Nick Miller, working with senior associate Sam Cottell and solicitor Aaron Hockly, and with assistance from fellow corporate partner Ron Smooker and his team, advised on commercial issues, with partner Jo Daniels advising on competition law aspects.
The debt funding, including for the buy-back, was handled by project and debt finance partner Dan Fitts and his team.
Rosedale said the complex nature of the transaction required a co-ordinated approach from the Clayton Utz team, with both new and existing arrangements between the two companies giving rise to a range of complex legal issues.
"For example, it was necessary to align the proposed share buy-back with the sell-down because Orica was the majority stakeholder in IPL and it had been responsible for a lot of the infrastructure that a listed company would normally set up itself. As well, the two businesses had in place a number of product supply arrangements between them," Rosedale said. "The separation out of IPL required us to document the transition period within which IPL would be required to source its new infrastructure as well as re-document the two-way product supply arrangements between the two companies."
Rosedale - who jointly led the legal team that advised Tattersall's on its historic IPO and ASX listing and is currently advising on its merger with UNiTAB - said the transaction marked an exciting new stage in IPL's evolution.
"Clayton Utz is pleased to have assisted IPL in taking the next step in the development of its highly successful business in what has been a company-transforming transaction."
