Lion and Kirin find their price

The string of deals finalised over the weekend led one observer to suggest that corporate lawyers and investment bankers mustn't have mothers. That said, the advisors for Kirin and Lion Nathan will at least be able to buy mum a magnum of champagne or a six-pack of Boags (or XXXX bitter if she's like mine) now that the implementation agreement between Lion Nathan and Kirin Holdings has been signed.

Teams representing the two parties worked on the details throughout the mother's day weekend, deciding that Kirin will offer the target $12.22 per share, of which 72 cents comes via two fully franked dividends: an interim one of 22 cents and a special dividend of 50 cents. The lawyers finished the agreement yesterday at Mallesons Stephen Jaques' headquarters at the top of Sydney's Governor Phillip Tower.

The agreement gives Lion shareholders approximately $12.37 per share including franking benefits if the proposed scheme of arrangement is passed by the FIRB and the New Zealand regulators. An independent expert's report and a meeting of Lion's non-Kirin shareholders will also be organised to determine if the $3.3 billion deal is to go ahead.
While Kirin owns 52 per cent of Lion Nathan, the offer effectively values the target at $6.5 billion on an equity basis and $8.2 billion on enterprise value, as well as a FY09 consensus forecast EBITDA multiple around 12.5 times. This multiple matches the valuation placed on InBev's $52 billion acquisition of American brewer Anheuser-Busch last year.

Working on the contract was a diverse team from Mallesons, comprising Meredith Paynter and Greg Golding in M&A, Sharon Henrick in competition law, Judy Sullivan from the firm's tax practice, and Nuncio D'Angelo from banking and finance. Also advising Lion on the finer points of negotiation were Caliburn Partnership's Ron Malek, Roger Feletto and Bryan Pearson.

On Kirin's side of the mahogany table were a team led by Grant Dempsey, Jon Gidney, Christian Lunny and Helen Whitehouse from JPMorgan and Scott Perkins, Colin Young and Stephen Pickles from Deutsche Bank. Ian Williams, Carl Della-Bosca, David Ryan, Stephen Menzies and Vivian Chang from Blake Dawson advised Kirin on the legals.