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GT M&A Advisor:
Greenberg Traurig Handles Public M&A Transactions Totaling $14.5 Billion in Past Month

June 2000
Greenberg Traurig Alert

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Terra/Lycos - $12.5 Billion
Rexall Sundown - $1.8 Billion
ILM and ILM II - $155 Million

During the last month alone, Greenberg Traurig, LLP was involved in several very significant domestic and cross-border mergers and business combination transactions with a combined value of more than $14.5 billion.

Greenberg Traurig served as co-counsel to Terra Networks in its $12.5 billion acquisition of Lycos; counsel to Rexall Sundown in the $1.8 billion acquisition of the company by Royal Numico of the Netherlands; and counsel to ILM and ILM II in its $155 million cash merger and "going-private" transaction.

A brief description of these transactions is provided below to give you an idea of the types of transactions we are handling on behalf of our clients. We believe these transactions may be relevant to you to the extent they impact the markets in which you compete.

I. Terra Networks, S.A. to Acquire Lycos, Inc.

As reported in The New York Times, The Wall Street Journal and dozens of other publications and news accounts around the world, Madrid-based Terra Networks, S.A. (MC:TRR; NASDAQ: TRRA) has agreed to acquire Waltham, Mass.-based Lycos, Inc. (NASDAQ: LCOS) for (U.S.) $12.5 billion. Terra and Lycos are creating one of the world’s largest Internet companies and the first truly multinational portal.

This business combination is significant not only because of its scale, but because it involves the first true cross-border convergence of Internet services, new media, e-commerce, branded content and new communication technology. It should serve as a model for future similar acquisitions and combinations.

Terra Network U.S.A.’s Chief Legal Counsel and Greenberg Traurig Shareholder Patricia Menendez-Cambo, together with New York Corporate Shareholder Clifford E. Neimeth and Miami Corporate Shareholder Jose. A. Santos, Jr. represent Terra in connection with its agreement to acquire Lycos and related transactions. Also involved with the transaction are New York Corporate Associates Anthony J. Marsico and Thomas Humbert, Jr.; New York Intellectual Property Associate David M. Greenberg; New York Technology Shareholder Jonathan D. Bick; New York Technology Associate Ellen Goldberg; Miami Corporate Associates Bert Diaz, Rafael Castro and Carol Fernandez; New York ERISA Shareholder Robert M. Fields; and Philadelphia Finance Shareholder Rick L. Frimmer.

Terra is the leading provider of Internet access and interactive content and services to the Spanish- and Portuguese-speaking world, and Lycos is the world’s leading multi-brand network. Telefonica S.A. (MC: TEF), which currently owns approximately 67% of Terra’s shares, is the largest broadcaster and the second largest pay-TV operator in Spain and Argentina.

In addition to the acquisition, Terra will conduct a cross-border rights offering to its existing shareholders to raise 2.2 billion (Euros). Upon completion of the rights offering, Terra will receive approximately (U.S.) $3.0 billion in cash, placing it among the most capitalized Internet companies in the world.

Completion of the Lycos acquisition is expected in the third quarter of calendar year 2000 once requisite regulatory and shareholder approvals are obtained.

New York Corporate Shareholder, Clifford E. Neimeth, observed, "This deal exemplifies the trend toward multinational synergism by means of strategic business combination. While the relative percentage of cash, stock-for-stock and hybrid deals will shift with prevailing market conditions, we should continue to experience heightened cross-border M&A activity for the foreseeable future as corporate enterprises race to attain new economies of scale, global market share, increased profitability, and more diverse shareholder constituencies."

II. Rexall Sundown

A Greenberg Traurig team consisting of Miami Corporate Shareholders Paul Berkowitz and Ira N. Rosner; Miami Tax Shareholder Steven B. Lapidus; Washington, D.C. Antitrust Shareholder Shirley Z. Johnson; Miami Corporate Associates David A. Barkus and Julie M. Levitt; and Miami Tax Associate Mindy B. Schultz, recently completed the acquisition of long-standing GT client, Rexall Sundown, by Royal Numico of the Netherlands for approximately (U.S.) $1.8 billion in cash and assumed debt.

Rexall Sundown is best known for its vitamins and nutritional supplements, but in recent years the company has scored hits with such products as Osteo-Bi-Flex, an arthritis remedy, and Cellasene, a controversial yet fast-selling pill designed to combat cellulite. The company posted $596 million in revenue and $60.1 million for profit for the fiscal year ended August 31, 1999.

Royal Numico, based in Zoetermeer, Netherlands, is the world’s largest vitamin maker with approximately $1.9 billion in revenue last year.

On a combined basis, Royal Numico and Rexall anticipate having approximately $4.5 billion in annual sales and 28,500 employees.


As recently reported in The New York Times, New York Corporate Shareholder Clifford E. Neimeth and Associates Alan S. Gaynor and Steven I. Glantz, as well as Washington, D.C. Corporate Shareholder Jeffry R. Dwyer, New York Litigation Shareholder Alan Mansfield, and Washington D.C. Litigation Shareholder Ronald W. Kleinman are representing ILM Senior Living Inc. and ILM II Senior Living Inc. (two affiliated publicly traded REITs) in connection with $155.0 million cash merger and "going-private" transactions. If approved by ILM’s public shareholders at a special meeting to be convened in late June, each of ILM I and ILM II will be merged into a 100% owned acquisition subsidiary of Capital Senior Living Corporation (NYSE: CSL) for approximately $11.63 and $13.04 per share in cash, respectively.

Capital Senior Living Corporation is one of the nation’s largest operators of assisted senior living communities and has managed the ILM portfolios for almost four years. Lehman Brothers, Cohen & Steers Capital Advisors, LLC, GMAC (Commercial Mortgage Group), Schroders & Co. and Ernst & Young also are involved in the transaction which is being led by Greenberg Traurig’s New York Office.

Greenberg Traurig’s Mergers and Acquisitions practice encompasses a broad spectrum of domestic and cross-border transactional engagements and includes:

  • negotiated and contested mergers and acquisitions
  • consolidations
  • business combinations
  • asset sales and purchases
  • proxy contests
  • tender and exchange offers
  • open-market transactions
  • cross-border acquisitions
  • going-private transactions
  • leveraged buyouts
  • spin-offs
  • strategic investments
  • implementation of anti-takeover programs and defenses
  • corporate governance matters
  • structuring and consummating complex business
  • combinations
  • change-in-control transactions
  • poolings
  • stock-for-stock mergers
  • cash acquisitions
  • exchange offers
  • consent solicitations
  • any other transactions involving the restructuring of publicly held debt and equity securities

In connection with these transactions, our attorneys regularly represent:

  • buyers
  • sellers
  • investors
  • stockholders
  • financial advisors
  • investment banks
  • special committees and boards of directors


© 2000 Greenberg Traurig

This GT ALERT is issued for informational purposes only and is not intended to be construed or used as general legal advice. Greenberg Traurig attorneys provide practical, result-oriented strategies and solutions tailored to meet our clients’ individual legal needs.