Morrison & Foerster, Ashurst and Mori Hamada & Matsumoto are acting on Japanese trading house Itochu Corp’s $1 billion tie-up with Thailand’s Charoen Pokphand Group.
As part of the tie-up, Itochu said it will sell 102.4 billion yen ($1.01 billion) of shares, equal to a 4.9 percent stake, to two units of Charoen Pokphand. The transaction will make the Thai group Itochu’s third-biggest shareholder.
A Morrison & Foerster team is advising Charoen Pokphand, led by Tokyo partners Randy Laxer and Mitsutoshi Uchida and Hong Kong partner Jeremy Hunt. Washington, D.C.-based litigation partner Jonathan Gowdy and of counsel Aki Bayz are advising on antitrust matters.
Ashurst is representing Itochu, led by the firm’s Hong Kong managing partner Robert Ogilvy Watson.
Mori Hamada & Matsumoto is providing advice on Japanese law.
Itochu is cementing ties with a group that has operated in China for more than three decades. Through the tie-up, Japan’s third-largest trading house can expect to deepen its already significant presence in China.
The funds raised by Itochu will mostly be used to buy a 25 percent stake in Hong Kong-listed C.P. Pokphand Co (CPP) from Charoen Pokphand Foods PCL for about $850 million. Both companies are units of Charoen Pokphand Group.
“CPP’s main businesses are in China, so our main target through this alliance is China,” Koji Takayanagi, senior managing executive officer at Itochu, told reporters.
The rest of the proceeds from Itochu’s share issue will be used as funds for investment and general spending on joint businesses in Asia.
Itochu said it will buy back as many as 78 million of its own shares - the same amount to be issued to Charoen Pokphand group - to avoid shareholder dilution.