In 2012, the Royal Bank of Scotland Group (RBS) sold its aircraft leasing company RBS Aviation Capital to a consortium led by Sumitomo Mitsubishi Banking Corporation (SMBC) for $7.3 billion (£4.8 billion).
"Even somewhere like Clifford Chance where lawyers regularly act on the largest deals in the market, that's one of the bigger transactions you're going to work on," says newly-qualified lawyer (NQ) Richard Evans, who worked on this deal.
Richard joined Clifford Chance's asset finance department after completing his two-year training contract, including six months in the department, and was quickly given significant responsibility on the transaction.
Doing the deal
Aircraft leasing companies buy aircraft and then lease them (in exchange for rent payments) to airlines, many of which own relatively few of the planes they operate.
The business that was formerly RBS Aviation Capital, and is now known as SMBC Aviation Capital, is one of the world's biggest aircraft leasing operations with over 200 aircraft. Its size and value in its market made it an ideal asset for RBS to sell following its decision to consolidate its business by focusing on core banking operations. Meanwhile SMBC, already a player in the aircraft leasing business, was happy to acquire RBS Aviation Capital.
Like many large Japanese corporations at the time, SMBC was holding significant cash reserves and was keen to make international acquisitions to take advantage of a strong yen.
However, SMBC faced some competition, and RBS and Clifford Chance ran a competitive auction process involving multiple bidders for the business, requiring separate sets of documentation to be negotiated in parallel until a late stage of the transaction.
"We at Clifford Chance were involved right from the beginning," says Paul Carrington, a senior associate at the firm who also worked on the Clifford Chance team acting for sellers RBS.
"The first stage was putting together materials explaining what the business was. We'd worked with RBS Aviation quite a lot, so we knew their history. We then went into the phase where various companies were bidding."
Clifford Chance lawyers helped to review the many bids and then, "as we got into the end game with the last few bidders, we needed to look at all of the pieces of the business where consent from someone other than RBS Aviation Capital was required to transfer them to the new owners."
This is where NQ Richard came in. Shortly after rejoining the department in April 2012, he was asked "to take responsibility for the task of dealing with all of the third parties who needed to be brought across the line in terms of giving their consent to the transaction, all within quite a tight deadline - it all had to finish at the start of June."
"When you're first qualified and you're brought into a deal like this," says Richard, "there's quite a lot to take in, because there are so many elements to get used to."
A deal to sell a large and complex business will always involve a range of types of legal work, as Paul explains: "There was a wide variety of teams from the London office involved: obviously corporate and asset finance being the lead, but also the competition and employment law teams."
Broadly speaking, on large M&A deals corporate lawyers advise on the terms on which a business is sold, finance lawyers advise on the terms on which the money financing the purchase is provided, while competition and employment lawyers will ensure that none of the regulation in their areas is broken by the transaction.
Because of their specialised knowledge of the aviation business, asset finance teams often work on the corporate as well as the finance side of M&A transactions, as the Clifford Chance asset finance team did on this deal.
On top of different types of expertise, the deal also involved different Clifford Chance offices. "Aviation is a very international business," says Richard, and the sale of RBS Aviation Capital was no exception.
This deal, the sale of an Irish-based business to a Japanese consortium, showed the benefits clients gain from using a law firm like Clifford Chance, which has one of the legal world's most extensive global networks.
"Having the international scope meant that if there was an issue with obtaining a relevant regulatory approval, that could get sorted," says Paul. "Or if we needed to find out what the Japanese law was on a particular point, we could get advice from colleagues in the Tokyo office very quickly."
Lawyers from a wide range of the firm's offices across the world, particularly New York, Tokyo, Shanghai and Sydney, advised on the transaction.
"Working with different continents has its negatives and positives," adds Richard. "The positive is that you get to work with a massive range of people, and one of the negatives is that occasionally it can mean working some fairly antisocial hours due to the different time zones!"
Getting used to irregular working days is just one of the challenging aspects of being given an important role to play on a global deal such as this one. But, as Richard explains, at Clifford Chance there's always help at hand for junior lawyers.
"Sometimes," he says, "you need to go and talk to a more senior person and ask their advice simply because you don't have the experience yet to be able to do something yourself. Here there's always someone, pretty much any time, that you can speak to if you're not sure about something."
Thanks to the combined efforts of the Clifford Chance team, the deal reached completion in summer 2012 and, all in all, Richard's had a flying start to his career as a fully-fledged lawyer.