Hunton & Williams lawyers on Jan. 15 helped Spanish client Banco de Sabadell close on its more than $142 million purchase of Mellon United National Bank, the Miami outpost of Bank of New York Mellon Corp.

David R. Yates, the Atlanta associate who served as second-in-command on the deal team, which was led by Hunton Miami partner Fernando C. Alonso, said an exact value has not been released on the all-stock deal because the price turned in part on the value of the Mellon deposits.

“Because the deposits increased, the purchase price ended up increasing as well,” he said. Because Sabadell had to file with the Bank of Spain, that country’s equivalent of the Federal Reserve Bank here, he added, “the final amount is still not entirely public.”

The transaction, first announced in July, included the acquisition of Mellon United’s $1.68 billion in deposits and 60 percent of its loans, which amounted to $875 million. Mellon United on Wednesday changed its name to Sabadell United Bank N.A.

Bank of New York Mellon’s most recent 8-K, filed with the Securities and Exchange Commission on Wednesday, indicates that at least some of the 40 percent of the loans that Sabadell did not purchase may have been real estate loans retained by the seller. Bank of New York Mellon in the fourth quarter of 2009 “recorded an after-tax loss of $119 million largely related to additional write-downs primarily for retained South Florida real estate loans,” the SEC filing says in a paragraph discussing the bank’s discontinuance of operations at Mellon United National Bank.

Yates said that most of the loans his client purchased were commercial mortgages, with “very, very few residential mortgages” thrown into the mix. As to why Sabadell did not buy the entire loan portfolio, Yates would say only, “It was a phenomenal deal that was negotiated by Sabadell, and in this current environment with all the regulatory scrutiny, that’s what the parties really believed was necessary and was in the best interest of the target bank in order to make it a very, very attractive transaction to Sabadell.”

This is Sabadell’s third major purchase of a U.S. bank. Sabadell purchased Miami-based TransAtlantic Bank in 2007, followed by Spanish bank BBVA’s private banking business in Florida in 2008. Hunton lawyers also worked on the latter of those deals. Together, the acquisitions bring Sabadell’s total business volume in the United States to approximately $6.4 billion—$4.3 billion in managed assets and $2.1 billion in loans.

Yates said that he spent most of the week prior to closing in a conference room overlooking Biscayne Bay, finalizing documentation and going through a signing round with Sabadell executives.

“Given that there were certain loans that were being transferred, assigned out or participated out of the target bank, there was a lot of dialogue and exchange on that,” he said. But, he added, “in general, both sides were well-prepared. They’d been communicating regularly between signing and closing.”

He added that he and the other lawyers and executives on the deal celebrated over churrasco, a specially cooked steak, at an Argentine restaurant in Miami.

Sabadell’s internal legal team was led in the U.S. by Anna Oestereicher, its U.S. general counsel, and in Spain by the bank’s general counsel, Oriol de Nadal Alier. Bank of New York Mellon was represented by in-house counsel, led by Marcia Wallace and Becket Sorce.

A $400 million deal is rare game these days, but Alston & Bird partner Janine Brown was fortunate enough to bag one.

She and associate David A. Wender, along with Canadian firm Lang Michener, represent Georgia-Pacific in its recently announced deal to purchase four compressed-board facilities from Grant Forest Products, a Canadian company that in June received judicial protection from creditors after a General Electric Co. unit tried to force it into bankruptcy.

The transaction, which is expected to close in the first half of this year, is subject to approval from the Canadian court overseeing Grant’s agreement under the Companies’ Creditors Arrangement Act, which protects Grant from lawsuits and creditors, but allows it to continue operations.

A Georgia-Pacific spokesman said that the deal also will be subject to approval by a U.S. bankruptcy court, but he could not immediately identify which one.

Brown and Wender could not be reached for comment by this blog’s posting deadline.

The deal also is subject to U.S. and Canadian regulatory review.

The factories, which produce what is called oriented strand board, an engineered wood product used for, among other things, subflooring, are located in Englehart and Earlton, Ontario, and in Allendale, S.C., and employ about 300 workers. When market conditions allow, Georgia-Pacific plans to complete construction on another plant, in Clarendon, S.C., which could employ 100 more people. The company, in a statement, also said it plans to make capital investments of “several million dollars” to improve facilities.

Grant’s financial troubles, which were exacerbated by the lagging construction market, had about $516.8 million in secured debt, according to a Bloomberg story published in June. The article said that General Electric asked a judge to put Grant into bankruptcy because of debts related to airplanes Grant leased from a GE division.

The wave of foreclosures that swept across Florida is beginning to yield some deals in the battered commercial real estate sector.

Arnall Golden Gregory partner Scott A. Fisher knows that firsthand, because he just closed a $32.5 million deal representing Bay Isle Key LLC, which includes Atlanta-based real estate investor Pollack Partners among its backers, in the purchase of 510 foreclosed apartment and condominium units in St. Petersburg.

“My client said to me … 'You know, this is the first deal we've closed in 18 months,'” recalled Fisher, who has represented Pollack Partners for years. “I said, 'You don't need to tell me that.' The fact that [the client] could find an equity partner to do the deal with is indicative of a recovery in the market.”

Fisher said competition for good real estate deals is keen these days. His client was able to land this one in part because it is a so-called “fractured condo deal,” meaning some of the units are condominiums and others are apartments. That structure, Fisher said, tends to discourage buyers looking for a simple deal.

He said the Bay Isle Key community, which includes a lake, three swimming pools, tennis courts and other amenities, initially was designed as an apartment complex. Then an investor bought it and began converting it to condos. About 70 units had been sold when the market collapsed and lender GE Capital foreclosed. A GE affiliate, Echelon Acquisition Co. LLC, represented by lawyers from Greenberg Traurig's Fort Lauderdale office, sold the units to Fisher's client.

The foreclosed units, Fisher said, sold for an average of about $63,700 each. Atlanta developer McRae & Stolz paid $59.4 million for the property in 2006, or $150,000 per unit, and then added nearly 200 units, according to a report in the Tampa Bay Business Journal.

“My understanding is that the property had been under contract before, but it was Pollack's ability to close quickly that facilitated their ability to buy the property,” Fisher said. He added, “Hopefully, this is indicative of what we will see in 2010. I would call 2009 … the year of indecision, primarily by banks.”

This year, he said, if banks get more decisive, “You're going to see more transactions like this available where you have an opportunity to buy foreclosed property or to buy loans from banks that will generate more transactional business. But in the end, the volume is going to depend on what happens in the financing market.”

Bankrupt Mesa Air Group Inc. wants to keep Jones Day as its outside lawyers, according to an application Mesa filed with the U.S. Bankruptcy Court for the Southern District of New York.

Jones Day, according to the filing, represents Mesa in a wide range of pre-petition litigation against Delta Air Lines and United Airlines Inc. In the past year, the firm has billed Mesa nearly $1.7 million for its services.

The filing lists the primary Jones Day lawyers expected to work on the litigation, along with their hourly rates. Among them are four Atlanta lawyers: partners G. Lee Garrett Jr. ($675) and David M. Monde ($625); and associates Robert A. Schmoll ($400) and Jason Burnette ($325).

According to the filing, Jones Day represents the beleaguered airline in four separate legal actions in three states.

Three of those suits were initiated in 2008 in U.S. District Court for the Northern District of Georgia. In one, Mesa and its subsidiary, Freedom Airlines, sued Delta seeking to enjoin Delta's termination of a jet operation agreement. The court issued a preliminary injunction in favor of Mesa, which was upheld by the 11th U.S. Circuit Court of Appeals. The parties now are awaiting a trial date in the district court. In another suit, Mesa and Freedom allege that Delta wrongfully terminated another agreement and are seeking $40 million in damages. The third Georgia suit involves Delta's allegation that Mesa and Freedom breached a “most favored nation” contract provision. In that case, the file of which is sealed, the court has not ruled on Mesa's motion to dismiss.

Mesa also sued Delta in August in federal court in Arizona over the termination of an engine maintenance agreement and Delta's allegedly unauthorized retention of seven aircraft engines. Delta filed a mechanics' lien on the engines and a counterclaim seeking to foreclose on the liens, but the court found that Delta had forfeited its lien claims. Delta has filed a notice of appeal to the 9th U.S. Circuit Court of Appeals; Mesa has a pending motion for summary judgment.

And United, in October, sued Mesa over the parties' code-sharing agreement about the in-service dates for certain aircraft in federal court in Illinois. The suit is pending.

Mesa's bankruptcy court filing seeking to retain Jones Day in these and related actions notes that Mesa's success in restructuring turns on the outcome of these suits, because 96 percent of its passenger revenues for fiscal year 2009 were derived from code-share revenue guarantee agreements with Delta, United and US Airways. “Accordingly, preserving or defending these relationships, and related rights and claims, will be a critical component of the Debtors' overall restructuring in these cases,” the application notes.

Mesa and 10 subsidiaries petitioned for Chapter 11 reorganization on Jan. 5, citing assets of $975 million and liabilities of $869 million. The suit is In re: Mesa Air Group Inc., No. 10-10018.

Smith, Gambrell & Russell lawyers are working on a military housing joint venture slated to be valued at $14 million when it is completed.

Partner Malcolm D. “Mac” Young and associates Jonathan M. Gallant and Eugene D. Bryant represented Atlanta-based Place Properties in a joint venture to capitalize Place's military housing division, Place Base Housing. Gallant said that Place's partner in the joint venture, which has requested anonymity, provided all the funding for the projects.

“We have acquired, built and are operating a number of projects, and are on schedule to develop More...

New private equity funds—especially ones which actually invest—are a bit of a rare breed these days. But DLA Piper partner Gerry Williams managed to land one as a client and help it make its first investment recently.

Williams’ client, the Bethesda, Md.-based RLJ Equity Partners, is a portfolio company of The RLJ Companies, founded by Robert L. Johnson, the owner of the Charlotte Bobcats. Its new fund closed in June with $230 million of committed capital.

Its first investment was the purchase of what Williams calls “a significant minority ownership stake” in LAI International from Minneapolis-based private equity firm Spell Capital.

LAI, which is based in Scottsdale, Ariz., and has outposts around the country, uses state-of-the-art lasers and water jet processing to manufacture precision-engineered components for a variety of industries, including healthcare, power generation, aerospace and defense. LAI has annual revenues of about $55 million, according to Spell Capital’s portfolio description.

The financial terms of the deal were not disclosed.

Williams said RLJ became his client when Rufus H. Rivers, whom he met through a mutual friend about seven years ago, became RLJ’s managing director.

The legal aspects of the deal took about 90 days to put together, and Williams said his team of lawyers handled all the mergers and acquisitions work, as well as issues related to real estate, environmental, intellectual property, employee benefits and tax matters.

“I think the unique aspect is, that given the current environment in the debt markets, the deal was done keeping the senior debt lenders in place,” he said. “It became a partnership between the then-existing private equity fund [Spell Capital] that owned the business and RLJ Equity Partners.”

Spell Capital was represented by Fredrikson & Byron in Minneapolis. The investment bank for LAI was Lincoln International.

The process to develop and finance Atlanta's BeltLine, a proposed 22-mile loop of transit, green space and mixed-use development, has not been an easy one. But in December, lawyers from three Atlanta firms—Hunton & Williams, Greenberg Traurig and Murray Barnes Finister—worked on various aspects of the deal that resulted in a $78.1 million bond issuance that refinances some of the BeltLine's debt on more favorable terms.

Douglass P. Selby, a Hunton & Williams municipal finance partner, represented the city of Atlanta and Atlanta BeltLine Inc. in the reissuance of $64.5 million in Series 2008 BeltLine tax-exempt tax allocation district (TAD) bonds, which were remarketed to new investors. Selby also worked on the issuance of about $13.6 million in new TAD bonds.

The transaction, said Selby, refinances a private placement done in October 2008—right around the time Lehman Brothers collapsed—when credit markets were anything but favorable.

“It was the worst of all possible times,” said Selby. But, he explained, the BeltLine needed the money to acquire what's known as the Northeast corridor property, 4.5-mile section of the proposed BeltLine that was purchased from Gwinnett developer Wayne Mason. “SunTrust and Wachovia were kind enough to extend credit during that time,” Selby said. “The 2008 structure was always meant to be a temporary sort of placeholder.”

Now that credit markets have recovered a bit, he said, the BeltLine was able to reissue the bonds “without the burdensome call features that the 2008 financing had attendant to it … . The 2008 holders could put their bonds, requiring the city to refinance them. The new financing is more traditional long-term financing,” he said.

The new debt, which has an average yield of about 7.5 percent, matures in 2031, he said. Nine investors purchased the new issuance, which Selby said was oversubscribed.

“It was a very good sign, the fact that there were more buyers interested in buying the paper than there were bonds,” he said. He also said that the BeltLine project likely will go back to market later this year with an issue for new money purposes that will include city, county and school board increments.

Selby said his team, which also included tax partner William H. McBride in the firm's Raleigh, N.C., and Washington offices and Atlanta public finance associate Rachel L. Devenow, began working on the issuance with the leader of the investment banking syndicate, Wachovia (now Wells Fargo) in October. SunTrust and Jackson Securities also were part of the syndicate, which was represented by Teresa P. Finister of Murray Barnes Finister. Kenneth M. Neighbors from Greenberg Traurig served as disclosure counsel to the city. Veronica C. Jones, general counsel of the Atlanta Development Authority, the implementing agency for the BeltLine project, could not be reached for comment by press time.

Morris, Manning & Martin lawyers have helped a Chinese auto parts company file a shelf registration statement with the Securities and Exchange Commission, preparing the way for offerings of up to $80 million in securities.

Morris Manning partner Jeffrey L. Schulte represented SORL Auto Parts Inc., the largest commercial vehicle air brake system manufacturer in China. SORL is based in Ruian City in Zhejiang Province and is also registered as a Delaware corporation. He prepared the registration statement and coordinated with the company, its auditors and printers to prepare the filing. He said he expects the registration to become effective in the relatively near future.

A shelf registration such as SORL's, filed on Form S-3, deems Securities and Exchange Act of 1934 filings incorporated, allowing a company to take down securities incrementally and go quickly to market by filing a prospectus supplement and without going through an SEC review process.

Two Atlanta lawyers recently helped their clients—one based in China and the other based here—ink a lease agreement on nearly 14,000 square feet of space in Atlantic Station.

Jones Day lawyer R. Mason Cargill assisted business incubator Chinamex in establishing a U.S. subsidiary and negotiating a 7-year, 10-month lease to house its new North American headquarters here. The lease was signed in mid-December, with Philip G. Skinner of Arnall Golden Gregory representing Atlantic Station.

Chinamex, a private Beijing-based company which helps other Chinese firms expand overseas, is the brainchild of parent company Chinamex Middle East Investment and Trade Promotion Centre, which already has established other business outposts in Amsterdam, Netherlands, and Dubai, United Arab Emirates.

Cargill said that Atlanta, thanks to good marketing and lots of personal attention from the Metro Atlanta Chamber of Commerce, won out over San Francisco as the incubator's U.S. headquarters. Chinamex, he said, plans to exhibit products manufactured by companies in the Hubei Province and its capital city, Wuhan, which has a population of about 10 million and is about an hour by air from Shanghai. Chinamex also will offer consulting and temporary office space and will help Chinese companies that want to deal more directly with the U.S. market to set up operations here, primarily for marketing their products.

Cargill and Skinner both said that U.S. leases are longer and more complex than leases in China, which meant that Chinamex officials had a lot of questions about the provisions and that negotiations took a bit longer than they might have with a U.S. tenant. Also, Skinner said, leases for mixed-use projects like Atlantic Station are by nature more complex than for free-standing office buildings because they involve covenants governing how a project can be developed and used and who pays for services that are used by the whole project.

Although Atlanta has been courting Chinese business for some time—Cargill was part of a prospecting trip to China, along with then-Mayor Shirley Franklin and the Metro Chamber in 2006—East-West business hasn't yet taken off in a big way here. The Atlanta-Journal Constitution reported that four much-promoted Chinese investment projects announced in the past three years have yet to come to fruition. These stalled projects include Kingwasong LLC's plans to produce soy sauce in Newnan and construction equipment manufacturer Sany Heavy Industry Co.'s plans for a $30 million investment in Peachtree City.

Still, Cargill—who spent several years in his firm's Shanghai office—said he thinks business relations will someday blossom between Atlanta and China. Developments are slow now because of the economy, he said, and because Chinese companies don't have the same incentives that Japanese companies had to set up operations here—namely, a cheaper work force than was available at home.

Still, he said, “I'm very optimistic. … I think it may be a slow process. A gradual process, but I think it'll happen.”