The M&A market isn’t dead. It’s just changed locations. Instead of the open marketplace, deals are getting done inside bankruptcy court. 

In a deal involving a bankrupt title insurance company, Miller & Martin partners Joe DeLisle and Nick Whittenburg advised an Alpharetta client on its purchase of four of the bankrupt company’s subsidiaries.

LandAmerica Financial Group Inc., which is operating under Chapter 11, has agreed to sell two business units to Buyers Protection Group Inc. for $12.2 million, subject to post-closing price adjustments. The units being sold are LandAmerica Home Warranty, which is headquartered in Alpharetta, and LandAmerica Property Inspections. The deal has been approved by U.S. Bankruptcy Court Judge Kevin R. Huennekens of the Eastern District of Virginia. However, it still requires approval from California state insurance regulators, DeLisle said.

DeLisle and Whittenburg are counsel to BPG, along with associates Tim Silvis and Charles Elrod. All the Miller & Martin lawyers are based in Atlanta except Whittenburg, who’s based in Chattanooga, Tenn.

BPG was formed by Revell Fraser, who is the former president of the LandAmerica Financial subsidiaries, for the purpose of acquiring the assets from Glen Allen, Va.-based LandAmerica. Arkansas investment firm Stephens Group LLC is an investor in BPG along with Fraser.

DeLisle said that Miller & Martin had not previously done work for Fraser, and was brought into this assignment via a referral.

BPG was tapped as the “stalking horse” bidder in the bankruptcy court-supervised sale, DeLisle said. That meant that LandAmerica had tentatively accepted BPG’s initial offer to acquire the assets, subject to an auction process. After LandAmerica’s biggest rival title-insurance company, Fidelity National Financial Inc., submitted a higher offer during the May 11 auction, BPG increased its initial offer from $10 million to $12.2 million.

Lawyers from Willkie Farr & Gallagher’s New York office and from the Richmond, Va. office of McGuireWoods are debtor counsel to LandAmerica.

An all-night auction produced the $82 million sale of a bankrupt Chattanooga carpet-industry supplier to a Minnesota investment firm, according to court filings.

Wayzata Investment Partners LLC will pay $82 million to acquire the assets of Propex Inc. Chattanooga-based Propex filed for Chapter 11 in January 2008. Propex, formerly known as Amoco Fabrics and Fibers, manufactures polypropylene fabrics used in carpet backings. Propex sells its products to the large number of carpet makers based in nearby Dalton, Ga.

Wayzata, headquartered near Minneapolis, outbid two other parties, Black Diamond Capital Management Inc. and Renco Group Inc. Wayzata’s purchase is subject to the approval of U.S. Bankruptcy Court Judge John C. Cook in the Eastern District of Tennessee.

Propex relied on two law firms for counsel on the sale, King & Spalding and Miller & Martin. King & Spalding partners Henry Kaim and Mark Wege in Houston, and partner Sarah Borders and counsel John Isbell in Atlanta worked on the matter. For Miller & Martin, partners Shelley Rucker and Nick Whittenburg, both of Chattanooga, were counsel to Propex.

Kirkland & Ellis partner David Agay in Chicago and Husch Blackwell Sanders partner Jeff Norwood in Chattanooga advised Wayzata.

During its efforts to secure economic incentives for its $1 billion manufacturing plant near Chattanooga, Volkswagen AG steered legal questions to Balch & Bingham partner Alex Leath.

Now the question becomes, what law firm will the German auto giant pick as its regular outside counsel for future matters in the U.S.? Balch is a contender for the prize assignment, Leath said. Chattanooga-based Miller & Martin is also bidding on the VW job, according to attorneys familiar with the law firm's plans.

Additionally, lawyers are also scrambling to represent other local governments in Tennessee, Georgia and Alabama that wish to lure suppliers that want to locate near VW’s first U.S.-based manufacturing plant, Leath said.

Leath, who is based in Birmingham, Ala., is not a newcomer to this type of legal work. Leath’s resume includes a stint advising the state of Alabama on negotiating incentives with Mercedes-Benz for a plant in Vance, Ala.; and another project advising Toyota on its plans for an assembly facility in Mississippi. His clients have also included Boeing, Northrop Grumman and General Motors.

“Probably no lawyer in the Southeast has benefited from the re-industrialization of the South more than the one you’re talking to,” said Leath [photo, right].

In addition to the winning site in southeastern Tennessee, VW also looked at sites in Alabama and Michigan. Leath advised VW on the site-selection process and has continued advising VW on implementing its economic-incentive package and on negotiating details on construction agreements.

Among the incentives is a payment-in-lieu-of-taxes agreement, in which Volkswagen has agreed to pay 29.23 percent of its Hamilton County, Tenn. property taxes between 2010 and 2039, according to the Chattanooga Times Free Press. After that, VW will pay 100 percent of its property tax bill.

VW’s plant will be located at the 1,300-acre Enterprise South industrial park east of Chattanooga. The 1.9 million-square-foot plant will build mid-sized sedans for the North American market, is expected to employ about 2,000 people, and is projected to begin operations in 2011, according to the Times Free Press.

Leath led a team of about 45 lawyers from Balch in a slew of practice areas, including environmental, real estate, labor and employment, corporate, tax, utilities, and railroad and trucking regulations. The Balch lawyers were spread out among the firm’s offices in Birmingham and Montgomery, Ala., and in Jackson, Miss.

Other attorneys who were involved in the economic-benefits package offered to VW, according to Leath, include: Miller & Martin partner Evan Allison in Chattanooga, who advised Hamilton County on real estate issues; Hamilton County Attorney Rheubin Taylor; Tennessee Department of Economic & Community Development General Counsel Stephanie Tisdale; and Chattanooga City Attorney Randy Nelson.

Three Morris, Manning & Martin lawyers advised apparel maker Boxercraft Inc. on a recapitalization.

MMM partners Sandy Smith and Bernard Coleman and associate Natasha Bell were counsel to Boxercraft, Smith said. Miller & Martin partner Jonathan Kent advised private equity fund River Associates Investments LLC of Chattanooga, Tenn., which provided the new financing. VRA Partners LLC of Atlanta was Boxercraft’s financial advisor. Terms of the recapitalization weren’t disclosed.

Boxercraft, of Atlanta, makes boxers, shorts, pants and shirts targeted to children and teenagers.

Lawyers from four Atlanta law firms were involved in the recent sale of a DeKalb County trucking company to two Atlanta private equity funds.

Last month Navigation Capital Partners and VVS Capital LLC, both of Atlanta, partnered to acquire James Brown Contracting Inc. of Lithonia for undisclosed terms. Wells Fargo & Co. and John Hancock Life Insurance Co. provided debt financing for the deal.

Hunton & Williams partners Joseph B. Alexander Jr. and Kevin F. Hull and associate Daniel P. Rollman advised Navigation.

Powell Goldstein partner Stuart C. Johnson advised VVS.

Miller & Martin partner David A. Flanigan Jr. and associate Timothy M. Silvis represented James Brown Contracting.

Burr & Forman partner Edgar C. Snow Jr. and associate Lindsey R. Arnold advised Wells Fargo.

Sullivan & Worcester was counsel to John Hancock.

James Brown Contracting owns two businesses – Brown Trucking Co. and JBT Brokerage. Brown Trucking hauls freight for paper and packaging-industry customers.