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Message: <blockquote data-quote="Coralin96" data-source="post: 713" data-attributes="member: 15">Last one before the end of the month <img src="data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7" class="smilie smilie--sprite smilie--sprite1" alt=":)" title="Smile    :)" loading="lazy" data-shortname=":)" />Former CFO of Autonomy guilty of fraud<ul> <li data-xf-list-type="ul">The Story: First some background - Back in 2011, Hewlett Packard paid over $11.1bn to acquire Autonomy. The year after that, three quarters of Autonomy's value was written down as HP alleged Autonomy had inflated its earnings during the due diligence process. It finally went to court this week and the former CFO of Autonomy was accused of creating fake transactions to increase the company's earnings - and he was convinced of fraud. Next year, HP is suing the former CEO of Autonomy, Mike Lynch along with its CEO, for $5.1bn in damages. Lynch is countersuing claiming it ruined his reputation.</li> <li data-xf-list-type="ul">Impact on law firms and clients: In 2012, the HP write-off shocked the markets. 15 firms were involved as advisors and none saw it coming. Its legal advisors included Slaughter and May, Freshfields, Skadden and Gibson, Dunn & Crutcher. The deal showed the importance of in-depth due diligence. But if it's proven that Autonomy fudged earnings, they may have no fault after all. Travers Smith is acting for HP in this suit, whilst Clifford Chance is representing Lynch, and Simmons & Simmons is representing the CFO. It's the second-largest case brought in Britain against an individual.</li> </ul>Sainsbury's and Asda merger<ul> <li data-xf-list-type="ul">The Story: Sainsbury's is taking over Asda, which is a subsidiary of Walmart. It will be paying Walmart £3bn for a 58% stake in the business. Walmart will also have no more than 29.9% of the voting rights.  If it goes through, it'll be the UK's biggest grocer by market share at 31.4% and both brands will continue to be used.  Together they will have 2,800 stores and 330,000 staff.</li> <li data-xf-list-type="ul">Impact on law firms and clients: The big UK supermarket chains have suffered from discount chains like Aldi and Lidl as well as e-commerce platforms like Amazon. It's a big move to revolutionise the UK retail market and shows a shift in strategy of Asda's owner Walmart. The question is whether this will go through as MP's have called for the UK regulator, the Competition and Markets Authority, to urgently review the deal. There are risks that suppliers will be squeezed, jobs will be lost and supermarkets will be closed. Slaughter and May is advising Walmart with Asda being a longstanding client. Gibson Dunn is also advising Walmart and Asda on competition issues. Linklaters is advising Sainsbury's.</li> </ul>$120bn worth of takeovers in one day<ul> <li data-xf-list-type="ul">The Story: On Monday, over $120bn in takeover deals announced despite political issues and uncertainty over regulations.</li> <li data-xf-list-type="ul">Impact on law firms and clients: This is continuing the trend of a record year in mergers, as a result of economic growth and low interest rates. This includes the Sainsbury's-Asda deal, the T-Mobile acquisition of Sprint to form the second-largest US wireless group, and Marathon Petroleum to buy Andeavor in the biggest energy sector acquisition since 2016.  The high value of shares have also contributed to this as currently share deals are very common.</li> </ul>China opening its market<ul> <li data-xf-list-type="ul">The Story: It was announced this week that the global benchmark index, MSCI, will be including 235 Chinese companies to its benchmark from next year - for the first time ever. This sent shares in the Chinese companies up and a series of Chinese asset managers rushing to set up funds ahead of the expected inflow of money.</li> <li data-xf-list-type="ul">The impact on law firms and clients: This is part of a broader trend that China is opening up its market to investors. The inclusion into the benchmark is expected to lead to a surge of foreign money into China's stock markets and it's a sign of renewed interest in the big established Chinese companies. Soon Bond Connect will also come into place, which links Hong Kong and Chinese debt markets for the first time. This will allow international investors to trade local equity and bonds without needing regulatory approval. As foreign investment in Chinese shares rise, some law firms may have to rethink entering the region, which has been a difficult market to break into. Many are playing the long game and expect to see significant return when it does open up.</li> </ul></blockquote>

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