The latest move in CitiGroup’s series of divestments involves selling part of its Duluth, Ga.-based Primerica Inc. life insurance business to private equity firm Warburg Pincus & Co., with a little help from its lawyers at Rogers & Hardin.

Partners Steven E. Fox and Alan C. Leet represent CitiGroup and its affiliates, along with attorneys from Skadden, Arps, Slate, Meagher & Flom. Lawyers from Wachtell, Lipton, Rosen & Katz represent Warburg Pincus, and the underwriters are represented by a team from Cleary Gottlieb Steen & Hamilton.

Fox declined to comment because the companies are still in the midst of the registration process.

According to an amended registration statement filed March 2, as part of a reorganization, Primerica will issue shares of common stock and warrants to purchase more to a CitiGroup subsidiary, along with a $300 million note at an annual 5.5 percent interest rate due in 2015.

Warburg will receive an unspecified number of shares and warrants in a concurrent private sale at a 5 percent discount off current book value. The aggregate purchase price of the common stock and warrants can be as high as $230 million, with an option—available for seven years—to purchase additional shares at list price for up to $100 million, according to the SEC filing.

The deal will give Warburg board seats and a significant—though unspecified—share of the company, with no more than 35 percent of the voting power after the initial public offering. CitiGroup will retain the proceeds of the IPO and sale to Warburg.

Prior to the offering’s completion, the amended registration statement says, Primerica also will ink three reinsurance transactions with CitiGroup, ceding to the larger company the bulk of its life insurance policies in force at the end of 2009, along with about $4 billion in assets to support the liabilities that the CitiGroup reinsurers are assuming.

One motivator for the deal, according to the amended registration statement, is to reduce CitiGroup’s insurance exposure. CitiGroup already has segregated or sold off other non-core businesses such as its Smith Barney retail brokerage in an attempt to rebuild its finances in the wake of the economic downturn and a $45 billion loan from the U.S. government.

Are we entering a new evolutionary stage in deal structures? A post on the New York Times Deal Blog by University of Connecticut law professor Steven M. Davidoff answers that question in the affirmative, citing changes in reverse termination agreements. According to Davidoff, who cut his transactional teeth as a deal lawyer at Shearman & Sterling, the structure of acquisitions is changing in the post-economic-crisis world as targets seek to bind acquirers as tightly as possible so as to avoid the type of deal demise that decimates share prices, and acquirers take the opposite tack, arguing for maximum latitude to end agreements if their financing falls through. Check out his analysis at Post-Crisis, the Evolving Structure of Deals. What do you think?

This initial acquisition, lead by Womble partner John F. “Sandy” Smith, involved the purchase of Richmond, Ky.-based Specialized Technical Services Inc.

“At core, they're meter readers, and they have a staff of meter readers that they subcontract to gas companies,” Smith said. “Now they also can offer technology-enhanced meter readings.”

That, he explained, means that a utility truck can drive past a meter and read it via a radio signal, without the driver needing to stop or get out. Or, he said, some meters are equipped to send readings directly back to the company.

“Enhanced technology for the service industry is how an investment banker would describe it,” Smith said.

He said that Specialized Technology Services, or STS, employs several thousand permanent and contract workers, and its business touches on a number of legal areas that required eight specialized lawyers for discrete tasks to get the deal done.

“From a lawyer's point of view, it had a lot of different issues,” Smith said, listing labor and employment, litigation, regulatory and federal and state tax matters that had to be considered in order to get the deal done.

Terms of the deal were not disclosed. Smith said only that STS's revenue, pegged at $18.8 million in 2006 in an Inc. magazine ranking of the nation's fastest-growing private companies, was now higher. He pointed out that Navigation focuses on companies with revenue in the $20 million to $100 million range.

This is the third transaction Smith has done for Navigation in the past three or four months, including helping the private equity firm acquire an audio-visual sales and design company with senior and mezzanine loan facilities from Regions Bank, and follow-on financing through Peachtree Equity Partners.

Jones Day partner Maria F. Farall of Atlanta was one of a team of attorneys advising NII Holdings Inc. in a $1.44 billion cash agreement with Grupo Televisa, S.A.B., the largest media company in the Spanish-speaking world.

At issue was a Mexican operating subsidiary for Reston, Va.-based NII Holdings known as Nextel Mexico.

Grupo Televisa, represented by lawyers from Wachtell, Lipton, Rosen & Katz, will acquire a 30 percent equity stake in NII's group. According to NII's 8-K filing with the SEC, the equity stake “reflects an implied pre-investment value of Nextel Mexico of $4.3 billion.”

The Mexican firm Gallástegui y Lozano, S.C., represented both companies on the Mexican aspects of the deal.

Farall, who worked with lead lawyer Jeanne M. Rickert out of Jones Day's Cleveland office, declined to comment on the transaction.

Televisa will receive an option to acquire an additional 7.5 percent equity interest in Nextel Mexico exercisable on either the third or fourth anniversary of the initial investment. Beginning on the third and each successive anniversary of the deal, according to NII's Securities and Exchange Commission filing, Televisa also will have liquidity put rights that, if exercised, will require NII to purchase up to 33.3 percent of Televisa's initial interest in Nextel Mexico. In general, a liquidity put right is used by an investor as a sort of guarantee of return on its investment. These liquidity put rights, for example, could give Nextel Mexico the incentive to cash Televisa out at some point or to go public.

Televisa also will gain the right to appoint two of Nextel Mexico's six board members.

The investment agreement is conditioned upon, among other things, the Nextel/Televisa consortium being awarded licenses to use specified amounts of spectrum in Mexico's upcoming auctions of its wireless spectrum. As of late last week, 17 bidders had filed documentation to participate in the May 25 auctions, according to an article in the Wall Street Journal.

NII's filings with the SEC indicate that Televisa's initial investment will be $1.14 billion, with the remaining $300 million paid in three equal installments on the first, second and third anniversaries of closing. Televisa's stake in Nextel Mexico will increase from an initial level of 25.3 percent to 30 percent as the installments are paid.

The companies have said that Nextel Mexico's wireless capabilities and Televisa's programming, content and multiple distribution channels, as well as its satellite and cable TV businesses, will combine to allow them to offer services including wireless, television, broadband data and fixed voice services.

The corporate intelligence service mergermarket has released its 2009 edition of Deal Drivers North America, an analysis of deal activity last year.

According to the report, produced in association with Merrill Datasite, North American M&A activity saw a 24.7 percent decline in volume and fell 7.6 percent in value. More than 3,000 deals were announced in 2009, with a combined value of $763.4 billion, compared with just over 4,000 deals with a value of $826.1 billion in 2008.

The deals mergermarket analyzed are valued at more than $5 million; if value was not disclosed, the turnover of the target was at least $10 million.

The most active deal sectors, as mergermarket defines them, were life sciences and health care, which accounted for nearly one-quarter of aggregate deal value, and energy, which posted almost one-fifth of aggregate deal value.

The report also includes a “Heat Chart,” which uses companies-for-sale stories written in the second half of 2009 as a barometer for deal activity this year. The South, which mergermarket defines as covering 12 states and the District of Columbia, posted the highest increase in for-sale stories. The sectors likely to be most active include technology, media and telecoms and energy, mining, oil and gas.

Legal advisers with Georgia offices, ranked from 1 to 20 by deal volume, include Jones Day (1) and DLA Piper (5).

Lawyers from Jones Day and Sutherland worked on a transaction to help Atlanta-based Spectrum Brands Inc. unite with small-appliance-maker Russell Hobbs Inc. in a stock-for-stock deal.

The deal will create a new entity that retains the Spectrum name and is estimated to form a combined company with revenues of about $3 billion.

Jones Day attorneys, led by New York partner Robert A. Profusek and including Atlanta associates William J. Zawrotny and Brendon K. Durkin, represented a special committee of Spectrum's board of directors. Sutherland partner Mark D. Kaufman was lead counsel to Spectrum.

Spectrum and its special committee had different lawyers to avoid conflicts of interest because both Spectrum and Miramar, Fla.-based Russell Hobbs are connected to the same investor, Harbinger Capital Partners.

“The company that owned 100 percent of Russell Hobbs owned 40 percent of Spectrum, so they're getting paid on both sides of the transaction, in essence,” Kaufman said, explaining why the special committee and company had separate counsel.

“They're getting the value for Russell Hobbs and for their Spectrum shares, and they might have an interest different from everybody else.”

Spectrum, which is known for brands such as Rayovac batteries and Remington shavers, is a public company. Russell Hobbs, whose brands include Black & Decker, George Foreman and Farberware, is private.

“In these situations, you typically get a special committee to represent the interests of the public shareholders,” Kaufman said.

The all-stock transaction assesses Spectrum at an enterprise value—equity plus debt—of $2.6 billion, which translates into $965 million net of debt. It equates to $31.50 per share net of Spectrum's outstanding indebtedness.

Russell Hobbs is assessed at an enterprise value of $675 million, or $661 million net of debt.

The deal “provides a de-levered capital structure and longer-term financing,” Kaufman said.

The plan is to refinance Spectrum's secured term debt and asset-based lending facility. According to documents Spectrum filed with the Securities and Exchange Commission, the companies have received commitments from Credit Suisse, Bank of America and Deutsche Bank for about $1.8 billion in financing. The banks will refinance a portion of the existing senior debt of both Spectrum and Russell Hobbs through a combination of new term loans, new senior notes and a new $300 million asset-based lending revolving credit facility. The new term loans and notes are expected to mature in 2016 and 2017, respectively; the current term loans were set to mature in 2012.

The deal is expected to close this summer. If it does, to further reduce the combined company's leverage, Harbinger has agreed to convert its existing $158 million in aggregate principal of Russell Hobbs' term debt and about $207 million of its preferred stock into common stock of the combined company at a price of $31.50 per share. Harbinger then would own almost 64 percent of the combined entity.

Before the deal can close, it must survive a 45-day “go shop” provision that gives the special committee and its financial advisers a chance to seek other proposals.

Kaufman said his firm has represented Spectrum for about a dozen years. Zawrotny, who said he worked on negotiations and contractual matters, said this is the first time Jones Day has represented an entity connected to Spectrum.

This agreement comes just six months after Spectrum and its affiliated companies exited a Chapter 11 reorganization filed in U.S. Bankruptcy Court for the Western District of Texas, when the company was saddled with $4.4 billion in debt. The company emerged from Chapter 11 in late August, having eliminated $840 million in subordinated debt and closed on a $242 million exit financing facility. Latham & Watkins represented Spectrum in the bankruptcy; Skadden, Arps, Slate, Meagher & Flom along with Vinson & Elkins represented various Spectrum affiliates in the reorganization.

Other Atlanta-based Sutherland lawyers on the Spectrum-Russell Hobbs deal included partners David A. Zimmerman and Eric R. Fenichel, along with associates Jennifer D. Lambert and Brian M. Murphy on corporate matters; and partners Reginald J. Clark on taxes and Alice Murtos on employee benefits issues. Lawyers from Richards Layton & Finger in Wilmington, Del., also represented Spectrum. Russell Hobbs' legal team was from Paul, Weiss, Rifkind, Wharton & Garrison.

On the financial side, Barclays Capital Inc. advised Spectrum's special committee, and Credit Suisse advised Spectrum Brands.

Lawyers from Autry, Horton & Cole and McKenna Long & Aldridge worked opposite sides of a $55 million power company transaction with philosophical roots dating back to the Franklin D. Roosevelt administration.

The deal involved selling Sowego LLC, which owns a 100-megawatt power plant in Mitchell County, to the Georgia Energy Cooperative, or GEC, which is a coalition of energy producers providing power for rural areas.

Kenneth T. Horton Jr. of Autry Horton, who represented GEC, and Robert E. Tritt of McKenna Long, who represented Sowego, both said the deal took more than a year to put together because of the numerous approvals the parties had to obtain from entities including the Rural Utilities Service, the U.S. Department of Agriculture and the Federal Energy Regulatory Commission.

“It was not an asset purchase,” said Horton, but a purchase of the limited liability company which owns the plant. If his client bought only the plant, he said, it would not have preserved Sowego’s existing contracts for water, gas and other services.

The parties also had to get the approval of pre-existing lenders. The Sowego plant had been financed by Ambac Assurance Corp., and in 2001, Sowego issued bonds that Ambac purchased, said Horton, who worked on the deal with partners Charles T. Autry and Roland F. Hall. By purchasing the limited liability company instead of the plant itself, he added, GEC essentially agreed to repay the bonds through power purchase agreements but did not have to directly assume—or refinance—the loan.

The purchase was part of a larger transaction that brought two electric membership corporations, or EMCs—Grady EMC in Cairo and Three Notch EMC in Donalsonville—into the previously 13-member GEC. The two new EMCs were indirect, part-owners of the Sowego plant, Tritt said, and they inked additional power purchase contracts with GEC as part of the deal.

Each member of GEC will pay a pro rata share of the cost of acquiring the Sowego company based on their electricity usage. Payments will be made via a decades-long power purchase agreement, according to Horton.

The deal’s Roosevelt-era roots come from the creation of electric cooperatives, a power production structure that had its beginnings in Georgia when Roosevelt visited Warm Springs for polio treatments and discovered that power costs there were high because of the cost of transmitting electricity to rural areas.

His realization led to the Rural Electrification Act of 1936, which prompted the creation of cooperatives initially designed to generate reliable, affordable power for farmers.

Georgia now has 42 electric cooperatives, which Horton said serve about 70 percent of the state’s land area. The Sowego plant, he said, is a gas-fired “peaking plant,” which means it runs only during extremely hot or cold weather, when lower-cost, coal-fired plants cannot keep up with peak customer demand. All 15 GEC members, he said, will use the plant.

Lawyers from King & Spalding offices around the East Coast helped pharmacy benefits manager BioScrip Inc. put together a cash, stock and debt payoff deal valued at $343 million to purchase Critical Homecare Solutions.

Although most aspects of the deal were handled out of the firm’s New York office under the leadership of partner E. William Bates II—who practiced at K&S’s Atlanta office before decamping to the firm’s Big Apple outpost in 1993—local lawyers worked on tax, benefits and other parts of the transaction.

“From a tax standpoint, the primary consideration is making sure that the transaction qualifies as a tax-free reorganization,” said Atlanta tax partner Robert G. Woodward, explaining that shareholders must receive at least 40 percent of their compensation in stock; the rest can come from cash or warrants. “The key issue is compliance with what’s called the continuity of interest requirement, so that the stock that’s issued to the target company shareholders is not taxable to them, and the transaction doesn’t trigger a tax liability at the corporate level,” he said.

Elmsford, N.Y.-based BioScrip will pay $242 million—including $132 million to retire the company’s debt—and will issue $101.2 million in common stock, based on BioScrip’s Jan. 22 closing share price, according to information from the company. BioScrip also will issue more than 3 million warrants with a $10 exercise price and a five-year term to Critical Homecare shareholders.

Jefferies Finance provided $375 million in financing.

Atlanta partner Donald S. Kohla, who handled benefits issues, said the primary challenge for his team came from trying to figure out how Critical Homecare’s numerous acquisitions over the past few years had been integrated into the entity that BioScrip was purchasing. Another challenge, he said, was Critical Homecare’s workforce structure, which includes both regular and contract employees.

Critical Homecare is a Conshohocken, Pa.-based provider of home health care services whose controlling shareholder is Kohlberg & Co., a private equity firm that will hold about one-quarter of BioScrip’s common stock on a fully diluted basis.

Bryan Cave lawyers—though none from Atlanta—provided regulatory counsel for BioScrip, and Sonnenschein Nath & Rosenthal provided regulatory counsel for Critical Homecare. Lawyers from Paul, Weiss, Rifkind, Wharton & Garrison represented Kohlberg in the deal.

The deal, which is subject to regulatory approval, is expected to close by March 31.

Crawford Communications Inc. has inked the first-ever sale of one of its divisions in a deal likely worth more than $100 million.

Los Angeles-based media services company Broadcast Facilities Inc. acquired Crawford’s Satellite Services Division, which includes television network origination, teleport, satellite uplink trucks, Internet, production services and media services to government clients in late January.

Crawford, an Atlanta-based company founded by Jesse Crawford in 1984, was represented by King & Spalding partners John J. Kelley III and Rahul Patel. Neither returned calls seeking comment. Broadcast Facilities was represented by attorneys from Latham & Watkins.

Terms of the deal were not disclosed. But in a Form D Notice of Exempt Offering of Securities that is part of an 8-K that Broadcast Facilities filed with the Securities and Exchange Commission, the company indicated that it was issuing $128 million in securities in connection with a business combination “such as a merger [or] acquisition” and as “additional consideration for the extension of credit.”

Ellis Jones, CEO of Wasserstein & Co., the private equity firm which owns Broadcast Facilities, said in a statement that financing came from Tennenbaum Capital Partners.

William Sherman, managing director of VRA Partners, an Atlanta-based investment bank which advised Crawford on the deal, said, “I think there was a strong rationale for this transaction because of the benefits available to Broadcast Facilities in combination with the satellite services division of Crawford. It gave them additional capability … and their first East Coast property.”

The combined company’s client base includes ABC, NBC Universal, DIRECTV Sports Networks, Hallmark, NFL Network, ESPN, NASCAR Media Group and government entities such as the U.S. Department of Defense, NASA and the CDC.

A major New York firm headed South recently to help with the acquisition of a troubled Georgia bank.

Wachtell, Lipton, Rosen & Katz lawyers represented Columbia, S.C.-based SCBT Financial Corp. in its agreement with the Federal Deposit Insurance Corp. to assume all deposits and some of the liabilities of Community Bank & Trust, based in Cornelia.

The Georgia Department of Banking and Finance closed the bank in January, and appointed the FDIC as receiver. Community Bank & Trust was founded in 1900 and operates 36 banks in 10 Georgia counties. Based on a June 2009 FDIC summary of deposits, ranked 7^th in market share statewide.

According to a transaction overview SCBT provided in a Securities and Exchange Commission filing, the bank purchased approximately $1 billion in assets and $753 million in loans, with the FDIC assuming 80 percent of losses—which include acquired loans and foreclosed real estate—up to a threshold of $233 million. The FDIC will assume 95 percent of losses in excess of that. The filing also said SCBT assumed approximately $1.1 billion in deposits, for which the bank did not pay a premium.

Matthew M. Guest, the lead Wachtell partner for SCBT on the deal, did not return a call seeking comment. Community Bank & Trust was represented by FDIC in-house counsel.

The transaction closed Jan. 29.