Akin Gump innovates: Counseling two global companies in the unprecedented joint venture formation and financing of a chemical facility
In 2010, a team of Akin Gump lawyers led by corporate partner Sandi Hallmark were brought in by Dow Chemical Company, a global chemical manufacturing company, to help structure a joint venture between it and Mitsui,, a leading Japanese trading company, for the construction and operation of a chlor-alkali facility inside Dow’s facility in Freeport, Texas. Once the JV was formed, Akin Gump went on to represent it in the financing and construction of the $677 million facility. Both transactions were commended by the Financial Times as among the most innovative U.S. corporate deals of 2011.
The matters were anything but “by the book”: Both the formation of the JV as well as the financing of the plant required reconciling the often-conflicting concerns of Dow and Mitsui, as well as of the lenders, in a manner that would ensure successful outcomes for all. Akin Gump’s skillful guidance helped ensure that both the JV transaction and the project financing were successfully addressed and, on the financing front, in record time, thanks to an innovative approach involving developing essential terms for the financing and seeking and responding to advice from lenders’ advisors in advance of lenders being chosen.
In the end, in addition to navigating the JV and financing issues, the innovative solution set a template for similar projects for the companies that may be developed in the future—with other JV partners as well as each other. “It is,” stated a senior Dow official, “a benchmark transaction with impeccable execution and exemplary teamwork combined with the fastest ever project finance timeline.”
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