Paul Hastings Japan-China Group completes a landmark onshore acquisition of a PRC State-owned listed company
Shanghai (March 10, 2006) Paul, Hastings, Janofsky & Walker LLP (Paul Hastings), a leading international law firm, has represented Sumitomo Corporation and Sumitomo Corporation (China) Holding Ltd. (Sumitomo), Japans third largest trading company, in the ground-breaking acquisition of shares in Henan Topfond Pharmaceutical Co., Ltd., one of Chinas largest State-owned pharmaceutical companies.
This landmark transaction posed a unique set of legal challenges because it is the first time that a foreign strategic investor has acquired equity interest in a PRC State-owned listed company using an onshore structure and involving share reform (the requirement to convert untradeable or illiquid shares into tradable shares). Sumitomos innovative deal is expected to open the door to similar onshore transactions for foreign strategic investors in future.
Taking over sixteen months to complete, the Paul Hastings transaction team handled a broad range of PRC (based on US transactional experience) and Japanese legal issues such as public disclosure, shareholder compensation, compliance, valuation and foreign exchange issues as well as successfully securing the approval of the relevant PRC provincial and national regulatory authorities, including the Henan government, MOFCOM, SAFE and SASAC.
A team of Mandarin, Japanese and English-speaking U.S. and Japan qualified corporate lawyers from Paul Hastings Shanghai and Beijing offices, led by partner Toshiyuki Arai advised on the transaction.
Toshiyuki Arai, a U.S. and Japan qualified partner in the firms Shanghai office, commented: Paul Hastings has a lot of experience in representing Japanese, American and other foreign strategic investors in their acquisitions in China, both onshore and offshore. This particular transaction is one of the most complex onshore foreign acquisitions ever to be completed in China and our team used cutting edge U.S. legal technology to structure this deal. We believe it will create a template allowing other foreign investors to acquire State-owned assets involving listed shares or even share reform.
Paul, Hastings, Janofsky & Walker LLP, founded in 1951, is a global law firm with nearly 1000 lawyers located in 17 offices in Asia, Europe and the United States. In Greater China, Paul Hastings is among the largest international law firms with a broad range of practices and over 130 lawyers in Hong Kong, Beijing, Shanghai and Tokyo qualified to practice law in Hong Kong, China, Japan, Singapore, Australia, England & Wales and the United States.
Paul Hastings Japan-China Group, comprising Japanese, Chinese and American lawyers based in Shanghai, Beijing and Tokyo, is involved in representing a broad range of Japanese and other foreign companies in their investments into China.
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