Preparation is paramount
Launching or defending against a bear hug or hostile bid requires careful coordination across legal, financial and communications workstreams. In an environment where approaches can emerge publicly and at short notice, the ability to act quickly and decisively often depends not only on preparation, but also on understanding the groundwork the other side is likely to have undertaken before an approach is made or received.
For target boards, preparation may include:
- Advisor readiness: legal, financial and investor relations/PR advisors identified in advance, with a clear allocation of responsibilities and agreed response protocols should an approach emerge.
- Strategic self-assessment: periodic review of the company’s strategy, valuation, vulnerabilities and long-term investment case, including areas likely to attract challenge from a bidder.
- Shareholder intelligence and engagement: monitoring the register for stakebuilding, activist activity and other changes in shareholder composition, while maintaining regular dialogue with investors and articulating the company’s equity story, supported by the latest valuation analyses.
- Market surveillance: monitoring of unusual trading activity, website traffic and other indicators that may suggest bidder or advisor interest.
- Takeover readiness and training: periodic board-level consideration of takeover preparedness, including director and management training, simulation exercises, and consideration of how decisions would be taken under compressed timelines and public scrutiny.
- Defense playbooks: development of a comprehensive defense playbook setting out anticipated shareholder concerns, likely bidder attack themes, key defense messages, advisor responsibilities and proposed lines of response.
- Supporting materials and verification: identification and maintenance of verifiable information capable of supporting the board’s defense of the company’s standalone value proposition, including valuation analyses and any evidence likely to be relied upon publicly.
For bidders, preparation may include:
- Valuation discipline: a clearly articulated valuation framework, together with a defined price ceiling and a considered understanding of where the board’s expectations are likely to sit.
- Shareholder intelligence and communications planning: analysis of the target register, including key shareholders, likely supporters and potential swing investors, together with consideration of the messages likely to resonate with those investors should an approach become public.
- Regulatory planning: early assessment of antitrust, FDI and other regulatory requirements, together with a credible pathway to obtaining any required approvals, since conditionality is often among the first aspects of an offer scrutinized by a target board.
- Defense anticipation: a clear understanding of the target’s standalone investment case, together with anticipated defense themes and substantiated responses to them.
- Financing and internal approvals: financing arrangements and internal approvals sufficiently advanced to support a compressed timetable.
- Execution readiness: assessment of whether a firm offer could realistically be announced within the 28-day PUSU period (if triggered), including the status of any diligence workstreams and other steps required to support a firm offer announcement.
- Stakebuilding strategy: assessment of whether, when and to what extent a stake should be acquired, taking into account disclosure requirements, tactical considerations and the potential impact on the target board, shareholders and competing bidders.
- Process planning: consideration of the implications of a public approach, including the possibility of competing bidders emerging once the target is put "in play", the role of any existing shareholding, and the effect that competition may have on valuation, timetable and deal certainty.
While bear hugs and hostile bids remain the exception rather than the rule, bidders are showing an increasing willingness to take approaches public and force the pace of engagement. A decision to go public is itself a strategic choice, requiring bidders to be confident in their valuation, financing, regulatory planning and ability to navigate a compressed timetable. For target boards, it increases the importance of being able to defend strategy, value and long-term prospects under public scrutiny. For both sides, the groundwork undertaken before an approach is made or received will often prove as important as the decisions taken once the situation becomes public.
Deal focus: helping Indonesia’s biggest sovereign wealth fund invest to improve nation’s nutrition
Landmark USD2.5bn investment gives Danantara a stake in a major food platform, supporting stronger protein supply chains and future growth across Southeast Asia.
We are advising Danantara, Indonesia’s largest sovereign wealth fund, on its USD2.5bn equity investment into, and partnership with, JBS Australia, the biggest integrated protein and food producer in Australia and New Zealand. Headquartered in Brazil, JBS Group is the world’s largest meat processor. Signed on August 7, 2026, the transaction remains subject to approval from Australia’s Foreign Investment Review Board (FIRB) and merger clearance from the Australian Competition and Consumer Commission (ACCC).
Fund’s first significant cross-border investment
The investment is Danantara’s first major move outside Indonesia and its biggest transaction to date. It gives the fund exposure to a large cash-generative food platform while supporting its objective to build Indonesia’s protein processing sector through future acquisitions and investments across Indonesia and Southeast Asia.
The deal materialized following government-to-government discussions between Brazil and Indonesia around a number of partnership and trade opportunities including food and nutrition. JBS was positioned as a partner able to strengthen protein supply chains into Indonesia and build regional operating capacity.
Novel governance structure gives Danantara enhanced rights
Danantara will acquire an initial 9.64% interest in a new Dutch HoldCo, JBS Australia Holding Company, for USD800 million at completion and then invest a further USD1.7bn through staged capital calls over three years, taking its stake to 25%. This may rise to 30% through a reverse earn-out linked to JBS Australia’s future EBITDA performance. JBS will carve out JBS Australia into the new holding company after the relevant regulatory conditions are satisfied.
From day one Danantara will receive governance rights as if it held 25%, giving it board, committee, reserved matter, dividend, information and business development rights during the build-out period.
The structure reflects a broader trend in Southeast Asia towards Holdco financing and platform investments as sovereign wealth funds and infrastructure investors deploy capital into long-term growth platforms as well as traditional acquisition targets. It drew on lessons from infrastructure platform deals that our Singapore team has led in the region; in both cases, the objective was to align governance with the commitment to inject capital from the outset. However, in the JBS transaction, the platform is being created around an established operating business that can serve as a vehicle for future expansion rather than a new or developing platform.
Danantara’s capital is ring-fenced during the first two years exclusively for acquisitions and investments in the Indonesian protein and food sector. After the sixth anniversary of completion, the parties must pursue best efforts to seek an IPO on mutually acceptable terms. Danantara also has a right to exchange its shares in the platform company for newly issued NYSE-listed shares, giving it a listed equity exit route independent of a flotation.
Addressing complex legal and regulatory hurdles
The transaction documents were drafted such that the initial investment, subsequent tranches and reverse earn-out provisions become binding only after FIRB approval (required due to the importance of JBS Australia to the country’s food sector) has been secured and completion has occurred.
The competition analysis was complex because the joint venture requires aggregation of the parties’ global holdings, which in Danantara’s case encompass all sovereign-owned enterprises in Indonesia. Australian merger review thresholds were triggered by the market capitalization of JBS Australia, while future increases in Danantara’s stake are likely to require further antitrust filings in certain jurisdictions.
Our global team provided M&A, antitrust, foreign direct investment, tax, commercial, real estate, debt finance, sanctions, export controls, environmental, employment, benefits, governance, litigation and restructuring advice, and were instrumental in reconciling differences in business practices between Brazil, the Netherlands, Australia and Indonesia.
Spotlight on sports
Our dedicated sports group advises the biggest names in professional sports, including leading clubs and investors, on M&A, financing, commercial arrangements, IP, disputes and regulatory matters. Here are a few examples of our most recent deals.
Fenway Sports Group sale of a stake in Liverpool FC
We advised Fenway Sports Group on the sale of a minority stake in Liverpool FC to a consortium led and managed by Amit Bhatia, with investments from Amit Bhatia and the Mittal Family Trusts, K5 Sports (with Jeff Bezos as the lead investor) and EE Capital, the family office of Elaine and Eduardo Saverin.
Apollo Sports Capital’s acquisition of Atlético de Madrid
We advised Apollo Sports Capital (ASC) on its acquisition of a majority stake in Atlético de Madrid. The investment by ASC will reinforce the club’s position among football’s elite and support its ambition to deliver long-term success for its millions of fans worldwide.
