Henkel in Acquisition of Akzo Nobel Subsidiary

Cleary Gottlieb represented Henkel KGaA in its recent acquisition of the adhesives and electronic materials businesses of the National Starch division of Imperial Chemical Industries Limited, a newly acquired subsidiary of Akzo Nobel N.V.

The ₤2.7 billion back-to-back transaction was agreed to by Henkel and Akzo in August 2007, prior to Akzo’s acquisition of ICI. At the time of the agreement, neither Henkel nor Akzo knew the organization details of National Starch and its adhesives and electronic materials businesses. Nonetheless, the initial agreement between Henkel and Akzo contemplated the closing of the on-sale within three months of the completion of Akzo’s acquisition of ICI. When Akzo completed its acquisition on January 2, 2008, and it became clear that the on-sale would require carving out the adhesives and electronic materials businesses from National Starch in more than 40 countries around the world, a closing within three months seemed impossible. Undaunted by the challenge, the Henkel and Akzo/ICI teams worked feverishly and, through a variety of asset transfers and share transfers around the world, the deal closed on April 3, 2008 – just one day after the three month goal.

The Cleary Gottlieb team working on the transaction included lawyers from 11 of the firm’s offices. In addition to corporate aspects of the deal, the firm handled the global antitrust/competition aspects of the transaction and advised on the €2.6 billion senior debt financing.

Cleary Gottlieb has represented Henkel KGaA for more than 30 years on numerous M&A matters, most notably in connection with Henkel’s cash-rich split-off transaction with Clorox and in its $2.9 billion acquisition of The Dial Corporation.