LEXPERT MAGAZINE
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JULY/AUGUST 2016 15
LEXPERT: Were lawyers required during
this feeling-out stage?
Berggren: Once we determined that the
strategy and corporate cultures appeared
to be aligned and we were able to reach
the same ballpark on price, we moved very
quickly on the deal. Lawyers were involved
fairly early on in the deal to try to help prep-
arations for the sale process including dili-
gence and the purchase agreement. Given
the international nature of the deal, Bon-
nier decided to retain DLA Piper, being a
long-term client of the firm in Sweden but
a new client to the Canadian practice. is
provided us with a central contact in Stock-
holm to manage the legal side of the trans-
action in a fairly seamless manner working
closely with the team in Toronto.
LEXPERT: What was the focus of negotia-
tions? Was it just price, or were other ele-
ments just as important?
Jeffrey Cohen (Torkin Manes LLP, for Spin
Master): e focus was related to price,
structure and the vendors' comfort with
respect to making representations and
warranties in a manner typical of a North
American transaction. With three targets
in three jurisdictions – Canada, US and
Sweden – tax structure was also a signifi-
cant focus throughout.
Berggren: Bonnier Group was also con-
cerned with finding a purchaser that was
well positioned to successfully complete
the transaction in a timely manner, includ-
ing a purchaser with sufficient available fi-
nancing, few regulatory- or governmental
approval-related issues.
LEXPERT: What were the biggest challeng-
es to getting this deal done?
Harrs: e biggest challenge was for us to
understand their business model. e value
in a company like Toca Boca is in their
creative talent and also in the number of
unique visitors and users, and the number
of downloads. It was something new for us
to conduct due diligence around this. Also
Toca TV was a big investment for Toca, so
it was difficult at first to understand the
business model for that initiative.
Vaughn MacLellan, DLA Piper (Canada) LLP
(for Bonnier Group): From a legal perspec-
tive, the biggest challenge faced in getting
the deal done was simply working across
multiple jurisdictions … in an extremely
aggressive period of time.
Glen Eddie (Torkin Manes LLP, for Spin Mas-
ter): is transaction involved the acquisi-
tion of three separate corporate entities
– Sago Sago, Toca Boca Sweden, and Toca
Boca US – operating in Europe, North
America and Asia, all of which were essen-
tial and integral to the continued operation
of the Toca Boca business. Completing
due diligence while draing and negotiat-
ing a purchase agreement to reflect such
due diligence in real time was a challenge.
Eddie: is required excellent collabora-
tion among the parties involved and co-
ordination among legal counsel in each of
the jurisdictions, including among
DLA's
Stockholm and Toronto offices.
LEXPERT: What would you say was most
memorable about this deal? And what can
we expect to see from Toca Boca?
Cohen: e takeaway for us will be how
the buyer team was able to swily get up
to speed on this business and get the deal
completed in the quick time frame re-
quired by both parties.
MacLellan: Yes, the pace at which the trans-
action was consummated and the ease with
which the parties were able to navigate ju-
risdictional issues through the coordinated
efforts of counsel.
Harrs: It was amazing that we could bring
the whole thing together in such a short
period of time. Our hope and expectation
is that Toca can continue their strong posi-
tion in the kids' app space while simultane-
ously building their brand through Toca
TV and their merchandising initiatives.
(For a summary and full list of legal
advisors, visit lexpert.ca.)
ON THE TREND
Brexit's Impact
For Canadian dealmakers, Brexit will have particular impact. Language and historical ties have made the United
Kingdom our greatest European transaction destination by far. Over the past three years, acquisitions in the UK comprised 45 per cent of all M&A
in the EU. Annually, the UK attracts $20.2 billion in Canadian M&A deals, compared to $24.8 billion for the rest of the European Union combined.
GRAPHIC
BY
DAVID
DIAS;
SOURCE:
THOMSON
REUTERS
