Corporate UpdateNew York Law Journal
Lawyers on Major Transactions
Wachtell, Skadden, McKee Advise Sale of CIT Home Lending Units
Finance company CIT Group Inc. has agreed to sell its home lending unit to Lone Star Funds, a private equity firm, in a deal worth $5.9 billion.
Dallas-based Lone Star will pay $1.5 billion in cash and assume $4.4 billion of CIT's debt in exchange for the home lending unit.
In a separate agreement, CIT also agreed to sell its manufactured housing portfolio to Vanderbilt Mortgage and Finance Inc., a lender for manufactured homes, for $300 million.
The two deals mark New York-based CIT's exit from the troubled home lending business as it seeks to focus on pure commercial finance. CIT said net cash proceeds are expected to be roughly $1.8 billion.
CIT's home lending business has service centers in Marlton, N.J., and Oklahoma City, Okla. It employs approximately 300 people. Lone Star specializes in distressed debt instruments and real estate-related assets.
The sale to Lone Star is ex-pected to be completed in six to nine months, and the sale to Vanderbilt this month.
CIT was represented by Wachtell, Lipton, Rosen & Katz and McKee Nelson.
Wachtell's New York-based team included corporate partners Edward Herlihy and David Shapiro, antitrust partner Joseph Larson, executive compensation and benefits partner Jeannemarie O'Brien, and tax partner Joshua Holmes. Participating associates were Benjamin Roth, Gordon Moodie, and Carmen Woo, all corporate; and Michael Krasnovsky, executive compensation and benefits.
Partner Reed Auerbach led a McKee Nelson structured finance and securitization team in New York that included partners Keith Krasney and Robert Wipperman. Participating associates were Harlyn Bohensky, Rolfe Hubley, Deanna Smith and Damian Steele.
Skadden, Arps, Slate, Meagher & Flom advised Lone Star with a team led by financial institutions partner Fred D. White III in New York, and included financial institutions partner David Ingles, structured finance partner Richard Kadlick, labor and employment law partner David Schwartz, tax partner W. Kirk Wallace, all New York; financial services partner William Sweet Jr., Washington, D.C.; tax partner Moshe Kushman, Los Angeles; labor and employment law counsel Kristin Major, Palo Alto, Calif.; employee benefits and executive compensation counsel Michael Bergmann, Washington, D.C.; and intellectual property and technology counsel Jessica Cohen and James Talbot, both New York.
Participating associates were New York-based Sven Mickisch and Albert Song, financial institutions; Michael Urschel, structure finance; Matthew Fagin, intellectual property and technology; Charles Shulman, employee benefits and executive compensation; and Los Angeles-based Sara Baird, tax.
Shearman, Sidley Austin Counsel $4.8 Billion Agribusiness Deal
White Plains-based Bunge Ltd., a global fertilizer producer and oilseed processor, has signed an agreement to purchase corn refiner and supplier of food ingredients Corn Products International in a deal worth $4.8 billion.
Under the agreement, the stockholders of Westchester, Ill.-based Corn Products, one of the world's largest corn refiners, will receive Bunge stock worth $56 for each Corn Products share. Bunge, the world's third-largest agribusiness by revenue, also agreed to assume $414 million of Corn Products' debt.
Bunge, which was established in 1818, supplies fertilizer to farmers in South America and processes oilseeds, grains and other agribusiness commodities worldwide. Corn Products, which dates to 1906, is a leading supplier of dextrose and a major producer of starch, high-fructose corn syrup and glucose.
After the deal Corn Products' stockholders will own approximately 21 percent of Bunge's diluted shares. Corn Products will become a wholly owned subsidiary of Bunge, and the combined company will have 32,000 employees in 40 countries.
The deal, which the companies hope to close in three to six months, is subject to customary closing conditions and approval from Bunge and Corn Products shareholders, as well as regulatory clearance.
Shearman & Sterling advised Bunge with a New York-based team that included M&A partners John Madden and Clare O'Brien; executive compensation and employee benefits partner Kenneth Laverriere; tax partner Don Lonczak; antitrust partner Kenneth Prince; executive compensation and employee benefits counsel John Morrison; and antitrust partner Lisl Dunlop.
Participating associates were Andrew Noreuil, M&A; Michael Brueck, M&A; Adam Kaminsky, executive compensation and employee benefits; and Washington, D.C.-based Ethan Harris, tax.
Sidley Austin represented Corn Products with a Chicago-based team led by corporate partners Thomas Cole, John O'Hare, and Robert Verigan. The team also included tax partners Sharp Sorenson and Jay Zimbler; employee benefits partner Mary Niehaus and Stewart Shepherd; antitrust partners Thomas Ryan and David Giardina; real estate partner Stanley Stallworth; environmental law partner Laura Leonard; labor counsel James Weiss; and intellectual property senior counsel Philip Crihfield.
Participating associates were Chicago-based Jackson Hwu, Kathleen Overly, Bill Fay and Baird Allis, all corporate; and Augustus Makris, tax.
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