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Executive Compensation and Benefits

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The lawyers of Sullivan & Cromwell’s Executive Compensation and Benefits Group advise companies, boards of directors, management teams and individual executives on the complete range of compensation and benefit arrangements in extraordinary corporate events, such as mergers and acquisitions and initial public offerings, in the context of transition and succession planning and in a regular advisory role. Our advice encompasses corporate governance, securities, disclosure and tax considerations.

The lawyers in our group work closely with other members of the General Practice and Tax Groups when special expertise might be needed. We also collaborate closely with our labor and employment litigators to assist clients with the full spectrum of employment issues that confront today’s businesses.

Our expertise is regularly applied to the Firm’s mergers and acquisitions activity, including negotiation of post-merger management structure and employment terms, implementation of new plans, and evaluation of future benefit plan liabilities. In many transactions, executive compensation and other “social issues” are the most critical and highly negotiated aspects of a transaction.

Our lawyers also have extensive experience in the design and implementation of tax-qualified employee benefit plans, and in advising on related compliance and fiduciary matters under ERISA and the Internal Revenue Code. Our practice includes both ongoing advice to plan sponsors and advice on plan termination, merger and other transitional issues that arise in the transactional context. We also regularly advise our private equity, real estate and other investment fund clients, and numerous financial institutions, in connection with the structuring of investments and financial products that will be offered to pension and other ERISA plans.

Recent practice highlights/notable engagements:

Company Representations

AIG in connection with its pending $15.5 billion sale of ALICO to MetLife (which spans more than 50 non-U.S. jurisdictions) and its $35.5 billion sale of AIA Group to Prudential
Cablevision in its spinoff of Madison Square Garden (MSG)
IMS Health in its $5 billion acquisition by investment funds managed by TPG Capital and Canada Pension Plan Investment Board (the largest announced private equity buyout of the year)
Fiat in its acquisition of Chrysler out of bankruptcy
Barclays plc in the pending $13.5 billion sale of Barclays Global Investors to BlackRock Inc.
National City Corp. in its $5.6 billion acquisition by PNC Financial Services Group, Inc.
Silver Lake Partners as the leader of an investor consortium in the pending $2.75 billion acquisition of a 65 percent interest in Skype Technologies S.A. from eBay
Ares Capital Management LLC and Teachers’ Private Capital, the private investment arm of the Canadian pension fund Ontario Teachers’ Pension Plan Board, in their pending $760 million acquisition of Simmons out of bankruptcy
Rio Tinto in the $1.2 billion sale of the U.S. packaging business of its Alcan Packaging unit to Bemis and pending $2.4 billion sale of the majority of its Alcan Packaging unit to Amcor
IPC Holdings in its $1.7 billion sale to Validus Holdings Ltd., which was initiated as a hostile transaction
Wachovia in the distressed sale to Wells Fargo and the related discussions with Citibank
Bank of Tokyo-Mitsubishi UFJ, Ltd. and Mitsubishi UFJ Financial Group in the $2.9 billion acquisition of publicly owned shares of UnionBanCal Corporation
Reed Elsevier in its $4.1 billion acquisition of ChoicePoint
InBev in its $60.8 billion acquisition of Anheuser-Busch Companies
Tenaris in its $1.1 billion sale of Hydril Company to General Electric Company
Commerce Bancorp in its $8.5 billion acquisition by Toronto-Dominion Bank
Medco Health Solutions in its $1.5 billion acquisition of PolyMedica Corporation
Hilton Hotels in its $26.7 billion LBO by The Blackstone Group
TXU in its $45 billion acquisition by a private equity consortium – the largest-ever U.S. utility acquisition

Board Representations

The Board of Directors of CIT in its restructuring, including its $31 billion exchange offer
The Transaction Committee of the Board of Directors of Pepsi Americas, Inc. in the pending $4.2 billion acquisition of Pepsi Americas, Inc. by PepsiCo, Inc.
The Compensation Committee of Procter & Gamble Co. in the $57 billion acquisition by Gillette
The Strategic Review Committee and Independent Directors of the Board of Directors of First Data in the $29 billion acquisition by Kohlberg Kravis Roberts & Co.
The Board of Directors of Albertsons in the $17.4 billion acquisition by an investor group comprised of SUPERVALU Inc., CVS and a consortium led by Cerberus Capital Management

Management Representations

The management of HCA and the Frist family in the $31.6 billion acquisition of HCA via leveraged buyout by an investor group led by Thomas Frist Sr. and Thomas Frist Jr., Bain Capital, Kohlberg Kravis Roberts and Merrill Lynch Global Private Equity—at the time of its announcement the largest leveraged buyout in history
Joseph Neubauer, ARAMARK Corporation’s Chairman, CEO and controlling stockholder, as leader of an investor consortium in the $8.8 billion acquisition of the company
Management of Guitar Center in the $2.1 billion leveraged buyout by Bain Capital