Everything Old is New Again

This is why you never throw away your files. More than four years after the first set of drafts, Slaughter & May and Linklaters won “Deal of the Week” honors from The Times (UK).

Unfortunately, it may have been a bit premature.

Slaughters represents Resolution Limited and Linklaters represents Friends Provident (which was founded by Quakers, hence the picture). Two UK financial services-companies that have had on-and-off merger discussions for years.

Linklaters has been advising Friends Provident, founded by Quakers in 1838, for decades. The already strong ties between the two were cemented when Sir Adrian Montague, a former Linklaters partner, was appointed Friends chairman in 2005.

Sir Adrian is a key player in the current negotiations, advised by Linklaters partner Owen Clay, who worked on the aborted 2005 deal. Olivia McKendrick, a partner, and Alex Molla, managing associate are advising alongside Clay.

Jeff Twentyman, who brought Resolution to the stockmarket last year, is leading  Slaughters’ team  advising resolution. Other partners close to Cowdery include Kathy Hughes and Robin Ogle.

Teams at the two Magic Circle firms started working on the deal in 2005, but governance issues have been the sticking point. The smaller Resolution (market cap is $600 million right now) is making a cash and stock offer for Friends (market cap is $1.6 billion), and Friends is concerned about where it will fit in the Resolution structure.

Last week, Resolution said it would leave Friends largely intact as a subsidiary, and would put the CEO and CFO on the parent’s board.

Despite the optimism last week, word has just come out that Friends has rejected the bid and isn’t interested in further discussions.

Hopefully the lawyers will keep their drafts close at hand.

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