30 November 2016 (Beijing Time), King & Wood Mallesons advised Apex Technology Co., Ltd. (Apex, SZSE: 002180) on successfully acquiring Lexmark International, Inc. (Lexmark), a world renowned printing and software company. Apex led a group of investors including PAG Asia Capital and Legend Capital to acquire 100% of Lexmark at an enterprise value of approximately US$4 billion (about 26 billion RMB). To date, this has been the biggest outbound transaction in the print industry, and is yet another example of China’s successful track record in offshore acquisitions.
Apex is the world's foremost supplier of aftermarket printer consumables, aftermarket consumable chip and core components. Lexmark is a global leading company focused on printing and imaging solutions, enterprise software, hardware and other services, with a network across more than 170 countries.
The transaction will bring forth long-term benefits for both companies. Leveraging Lexmark’s brand, technology and global network, Apex will be able to accelerate its business growth in overseas markets, while Lexmark’s top of the line products will enjoy wider access in the Chinese market. Lexmark will be able to further promote its development strategy by enabling it to fully penetrate the fast-growing Asian markets.
This deal is one of the biggest overseas M&A transactions by a non-financial Chinese listed company. It involves a Chinese listed company’s acquisition of a US listed company, and therefore is required to comply with both PRC and US’s legal and regulatory requirements. Facing multiple challenges, the transaction was concluded in a highly competitive environment with a demanding timetable particularly in the lead up to completion, including during the processes of preparation of terms of delivery to obtain CFIUS’ approval, investors’ investment arrangement, and the implementation of a loan financing. The acquisition took effect local time on 29 Nov, 2016 in the United States.
Acting as Apex’s legal counsel, KWM has advised Apex on a number of its capital market transactions and acquisitions in recent years, including its previous acquisition of Static Control Components, Inc. (SCC). KWM’s professionalism and capability have won high praises from the client. In this transaction, KWM has acted as Apex’s legal counsel, providing legal advice on all aspects of this acquisition. The lead partners include Xu Ping, Pan Yujia, Wang Jianxue, Lv Yinghao, Huang Wen, Yang Xiaoquan and Liu Cheng.
Xu Ping said, “We are honoured to provide legal advices to Apex, which is one of our long-standing clients, to take a significant step closer to achieving its global strategy. And we are proud to have worked on yet another landmark Chinese outbound deal. During the course of the transaction, our team have contributed their professional expertise and experience in multiple practice areas by providing comprehensive legal services in M&A, securities, financing, and antitrust. We also assisted the client in resolving complex legal issues, particularly in satisfying PRC and US legal and regulatory requirements and working out the differences between the market practices of two countries, and ultimately completing the deal.”