A note to our followers

As many of you know, we’ve been sending a monthly summary of joint venture transaction activity for years. These past few months have been different. The coronavirus has upended corporate M&A departments, and we expect the number of joint venture transactions – both the creation of new and the restructuring of existing – to decline as companies work to figure out how an economic downturn will impact them and their potential partners.

However, if history is a guide, JV transaction volumes will decline less severely than M&A activity, and the number of JV transactions will increase sharply in the early stages of the recovery. We hope that recovery isn’t too far off. In the meantime, we will continue sending monthly updates, and we will remain available if you would like to chat about a JV transaction or restructuring that is ahead of you.

Diavik official claims Dominion kept partner in the dark about creditor protection bid

May 5, 2020 | CBC

A rift seems to be developing between Dominion Diamond and Diavik Diamond Mines, its partner in the Diavik diamond mine joint venture in the Northwest Territories.

Dominion, one of the largest employers in the Northwest Territories, is being protected from its creditors because it cannot pay its bills, particularly a $20 million US interest payment that was due May 1 and a $16 million Cdn payment due to Diavik as part of their partnership.

Related Water Street Insight: Contemplating Your Joint Venture Exit Strategy: Structuring Exit Terms in JVs

Liberty and Telefonica agree $38 billion UK tie-up to take on BT

May 7, 2020 | Reuters

LONDON/MADRID (Reuters) - Liberty Global (LBTYA.O) and Telefonica (TEF.MC) have agreed to merge their British businesses in a $38 billion deal that will create a powerhouse in mobile and broadband to take on market leader BT (BT.L).

In the biggest shake-up of the British telecoms market for five years, the deal will bring together the biggest cable TV provider in Liberty’s Virgin Media with Telefonica’s O2, the second-largest mobile operator.

Related Water Street Insight: How to Shape Joint Venture Strategy

Another Big Deal Sunk by Coronavirus: Amex GBT Investment Deal Falls Through

May 10, 2020 | Yahoo Finance

Private equity firm Carlyle Group and Singapore sovereign wealth fund GIC are pulling out of a deal to invest in American Express Global Business Travel, a corporate travel booking service that is 50 percent-owned by American Express, according to published reports.

The investment would have given Carlyle and GIC a 20 percent stake in American Express GBT for $900 million and placed a value on the company of $5 billion. It’s just one of several deals so far that are being tripped up by uncertainties created by the coronavirus pandemic.

Related Water Street Webinar: Joint Ventures and Partnerships in an Economic Downturn: What History Teaches Us

Politics and Porgera: why Papua New Guinea cancelled the lease on one of its biggest mines

May 11, 2020 | Guardian

Late in April, in the middle of a global pandemic and slow-boiling domestic economic crisis, the government of Papua New Guinea made the surprising announcement not to extend the mining lease on a goldmine that contributes roughly 10% of the country’s total exports.

The announcement not to renew the special mining lease for the Porgera mine was a shock, not least to the mine’s operator, Barrick Gold, and their joint venture partner Zijin Mining.

Related Water Street Insight: Joint Venture Portfolio Management: The The End of Adhocracy

Voith, Moog Form Joint Venture

May 11, 2020 | Compressor Tech

Voith Group and Moog Inc. have formed a joint venture to expand the hydrostatic servo-hydraulics business in various industrial markets.

The joint venture, known as Hybrid Motion Solutions GmbH (HMS), will use Voith Group and Moog’s shared experiences to focus on research and development, design, assembly and service to enhance hydrostatic servo drives and enter new markets.

Related Water Street Insights: Key Observations on Joint Venture Launch Planning

Ineos energy venture seeking up to £500m of emergency government loans

May 13, 2020 | Cycling Weekly

Petroineos, an energy business part-owned by Jim Ratcliffe, is looking to secure up to £500m in government loans amid low oil demand, which was triggered by the coronavirus pandemic.

The energy company is jointly owned by Ratcliffe’s Ineos Group and a state-owned Chinese company called PetroChina. Petroineos, which is based at Scotland’s only oil refinery near Falkirk, and has been discussing a loan package worth hundreds of millions of pounds with the UK and Scottish governments.

Related Water Street Webinar: Joint Ventures and Partnerships in an Economic Downturn: What History Teaches Us

Atul Gawande to depart as CEO of health venture, Haven

May 22, 2020 | The Drinks Business

It seemed an ideal partnership: Three of America’s most powerful companies were teaming up with one of its most celebrated physician writers to topple a health care system with out-of-control costs and mediocre patient outcomes.

But two years later, Atul Gawande is leaving the CEO role at Haven, the venture formed by Amazon, Berkshire Hathaway, and JP Morgan Chase & Co.

Related Water Street Insight: Maintaining Alignment in Your Joint Venture: A Full Contact Sport

NTPC in pact with ONGC to set up Joint Venture Company for Renewable Energy Business

May 22, 2020 | NTPC

NTPC Ltd. and Oil and Natural Gas Corporation Limited (ONGC) have signed a Memorandum of Understanding (MoU) to set up a Joint Venture Company for Renewable Energy business. The MoU will enable both companies to accelerate their footprint in Renewable Energy.

The MoU was signed by Shri A K Gupta, Director (Commercial) NTPC and Shri Subhash Kumar, Director (Finance) and In-charge Business Development and Joint Venture, ONGC. The MoU signing activity has been done on Virtual conferencing mode in the august presence of Shri Gurdeep Singh, CMD NTPC and Shri Shashi Shanker, CMD ONGC along with the other Directors and officials of both the companies.

Related Water Street Insight: The Joint Venture Operating Model Blueprint

Comcast, Charter and ViacomCBS Announce Blockgraph Partnership

May 29, 2020 | Business Insider

NEW YORK--(BUSINESS WIRE)--Today, Comcast Corporation (NASDAQ: CMCSA), Charter Communications, Inc. (NASDAQ: CHTR) and ViacomCBS (NASDAQ: VIAC; VIACA) announced that they have entered into an agreement to take equal ownership of Blockgraph, an industry initiative and software platform designed to create a more secure way to use aggregated and anonymized data and share information. This joint venture is focused on ushering in a new way of using audience data for advanced TV and premium video advertising. Using Blockgraph technology, media companies can help marketers form insights across their collective platforms without relying exclusively on third parties.

Related Water Street Insights: How to Sctructure a Joint Venture: 5 Essential Elements

VW to take full control of Chinese EV joint venture

May 29, 2020 | Automotive News Europe

BEIJING -- Volkswagen Group has agreed to invest 2.1 billion euros ($2.33 billion) in two separate Chinese electric vehicle players.

VW said it will invest 1 billion euros to take a 50 percent stake in the state-owned parent of Anhui Jianghuai Automobile Group (JAC Motors). The automaker will also raise its stake in an existing EV joint venture with JAC to 75 percent from 50 percent.

This will give VW full management control of the JV, said Stephan Wollenstein, the company's China CEO. The joint venture will launch five more electric models by 2025 and establish an EV factory in Hefei, VW said.

Related Water Street Webinar: Dealmaking in a Downturn - Pitfalls and Best Practices