On May 8, 2015, Repsol S.A. of Madrid, Spain completed the acquisition of Talisman Energy Inc. in a deal worth approximately $16.5 billion (US$13.5 billion). The transaction was the largest M&A deal by value announced in Canada in more than two years and the largest international deal by a Spanish company in over five years. The transaction was completed by way of court-approved arrangement under the Canada Business Corporations Act and, upon closing, all of the issued and outstanding common and preferred shares of Talisman were acquired by Repsol for cash consideration. Talisman’s publicly held debt remained outstanding following completion.
Negotiations began in the summer of 2014 but broke off on a couple of occasions before an agreement was finally struck and announced on December 15, 2014 – in this period, crude oil prices declined by more than 45 per cent. The transaction involved Investment Canada Act, Competition Act (Canada) and other regulatory approvals in more than 12 jurisdictions internationally. Globally, Repsol was advised by consulting, finance, legal and tax professionals in more than 20 countries, reflecting the depth of expertise required to complete the multi-jurisdictional components of the transaction. The acquisition was further complicated by the cross-border listing of Talisman’s shares on the TSX and NYSE, and the involvement of Carl Icahn’s activist investment funds in Talisman’s shares.
Bennett Jones LLP acted as primary legal counsel to Repsol and coordinated an international team of local counsel in 15 countries, including the United States, United Kingdom, Norway and Australia. The Bennett Jones team included David Spencer, Jon Truswell, Colin Perry, Domenic Puglia and Arnold Fridhandler (M&A); Jean-Pierre Pham and Vivek Warrier (oil & gas); John Gilmore (employment); Karen Dawson (banking & finance); Don Greenfield, QC (Investment Canada); Melanie Aitken and Kyle Donnelly (competition); Anthony Friend, QC, and Scott Bower (litigation); Susan Seller (pensions); and Darcy Moch and Robert McCue (tax). At Repsol, the team included Luis Suarez de Lezo Mantilla, the company’s general counsel, Miguel Klingenberg and Pablo Blanco. Sullivan & Cromwell LLP provided United States securities advice to Repsol with a team that included Sergio Galvis, George Sampas, Werner Ahlers and Robert Risoleo.
Talisman’s legal team was led by Bob Rooney and included Tamiko Ohta, Karen Uehara and Tim Kessler. Talisman was represented by Norton Rose Fulbright LLP in Canada, with a team that included Kevin Johnson, QC, Tad Gruchalla-Wesierski, Don Tse and Peter Allegretto (corporate finance and securities); John Carleton (Investment Canada and competition); Steven Leitl (litigation); and Darren Hueppelsheuser and Dion Legge (tax), and in the United States for securities class action litigation, with a team including Gerard Pecht and Peter Stokes. Wachtell, Lipton, Rosen & Katz LLP provided advice to Talisman on other United States matters, with a team including Dan Neff and David Katz.