Ropes & Gray’s Global Head of Mergers & Acquisitions Discusses Triumph in Mentor Graphics’ Sale to Siemens
The first installment of Law360’s revived series “Sealing The Deal” features mergers & acquisitions partner Paul Scrivano’s (New York/San Francisco) representation of Mentor Graphics’ rare “hell or high water” acquisition by Siemens AG, outlining the transaction’s numerous challenges. When Mentor Graphics decided to explore a sale in the summer of 2016, the electronic design automation software company turned to Mr. Scrivano, global head of Ropes & Gray’s mergers & acquisitions practice.
The article describes the complex sales process with multiple pressures that included media leaks, navigating investor activism, steering the deal through anti-trust clearances as well as scrutiny by the Committee on Foreign Investment in the United States (CFIUS). The associated risks resulted in the inclusion of an uncommon “hell or high water” clause. “We negotiated for and obtained true ‘hell or high water’ regulatory efforts in this deal, which is extremely rare,” explained Mr. Scrivano. “It is almost unheard of to be able to get this type of unqualified ‘hell or high water’ provision — usually it is qualified by a material adverse effect limitation or a dollar threshold divestiture limitation, but our provision was not so qualified — and to also have the provision cover CFIUS, as well as antitrust.”
The transaction was announced November 14, 2016 and after obtaining all regulatory clearances closed on March 30.