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IPO REPORT

India'sIPOkings
Though the Indian IPO market has taken a recent blow from falls in the country's stock
markets, no one doubts the market is waiting to take off again. ALB spoke to some of the
key firrns cornering this lucrative market to find out just how they are winning business
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issuer underwriters Lead Manager
in. the Indian capita.l markets growth story, leading to intense Dorsey &Whitney 3 2 1
competition for new business. Davis Polk & 1
John Chrisman, head of the Indian capital markets practice at Wardwell
Dorsey & Whitney, says firms will swarm over the market trying " !
Jones '- Day 1" ;3 ;
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to capture business while the market is hot. "Most internationa.l 1


Cravath, Swaine & -j
law firms have only been focusing on China, but India now offers Moore j
a chance for diversification," Chrisman says. ---
Lin kl aters 1
Jones Day's GeoffMaddox agrees, and says that until recently
it was a market that only a few:firms were interested in entering. Milbank, Tweed, 1
"It takes a lot oflocal market expertise," Maddox explains. Hadley & McCloy
However, with the internationals just starting to set their eyes
on the Indian IPO pie, it is the firms that have been active in
India for some time that are winning business. Chrisman formed Dorsey's capita.1 markets practice in October
Chrisman's practice has to date been perhaps the most 2005 with two associates he brought with him after the collapse
successful in India, which is a direct result of his history working of Coudert Brothers, and has managed to put together a
on these deals from the early 19908. He worked on his first Indian substantitive deal list over the past eight months.
offering in 1993 as an associate at Sullivan & Cromwell and Maddox is another internationa.l success story in the Indian
has since worked on over 100 securities offerings and corporate market, having this year advised the underwriter on three IPOs
transactions by Indian companies while a partner at Freshfields and the cOlnpany on one. "Wfive been active in India for about 10
Bruckhaus Deringer, Jones Day and Coudert Brothers. years," Maddox says. "We've managed to win business through a
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IPO REPORT

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"If the market
!,f'fijm8N/M;;IIOI\I?,!ti}(i(i'",}'. "'}i}';fi!iii,.
'.'i'/JJi:;!f.
Firm Number of grows and needs
eals
Amarchand & Mangaldas B more resources,
& Suresh A Shroff &Co
S
then we will
J Sagar Associates
MIs Crawford Ba}'leY& Co 5 respond to that,
Rajani Associates 4
Khaitan & Co 3
but if the market
2
ALMT Legal is turning down,
AZB &'Partners 2
_...
MIs V S Raju and 2
we will divert
Associates
Dua Associates - 1
our resources to
Economic Laws Practice 1 ShardulSlu'off
something else"
Junnarkar &Associates 1
. --
Kanga & Co 1 up experience and know-how in the market relationships and trust, developed over
KANJ & Associates 1 during recent boom years, all are expecting many years rather thanjust during recent
the wave of !PO business to continue years, as !POs have grown spectacularly
Little & Co 1
coming their way when this short market- in size, complexity and numbers. The
M/sARALAW 1 driven hiatus comes to an end. length ofinvolvement in capital markets
Mustafa Motiwala 1 First among these is Amarchand & is also playing a role, as is the amount of
(advocate and solicitor) Mangaldas & Suresh A Shroff & Co, the experience that firms have attained in
Note: Figures are for January to the end of May 2006 :firm most involved in the market this year the sector.
Source: Bombay Stock Exchange until the end of May according to figures Amarchand & Mangaldas managing
sourced from prospectuses available on partner Shardul Shroff says the firm has
combination of working with investment the BSE. built good relationships with clients over
ban1<..8across the region and working with . Of the transactiGJwi."'lthc t;;;118compiled a perioa of 15-20 ye-ars due to quality
Indian law firms." ,by ALB, Amarchand & Mangaldas has of service. He says the capital markets
Jones Day is currently in the throes of taken a 20% slice of the pie in terms of practice area started back with his father
working on six more !POs in India. "It's a acting as adviser to companies on their and has evolved since then.
case of the more you do, the more you are !PO issues. Other key players that have . "It isn't only these working relationships,

asked to do," he says. been able to scoop up business advising for but :i1so the fact we've been involved in
Chrisman says along-term commitment the company were Crawford Bayley & Co some of the most complicated, cutting-edge
to India and strong relationships are the and J Sagar Associates, who each advised deals in the market," Shroff says.
ingredients for a successful practice - and five companies on their issues during the One of the -most complex, according
he has no doubt India will keep growing. period, followed by Rajani Associates.
"The Indian miracle will continue in my - S&R Associates has also managed to INDIAN FIRMS ADVISING
lifetime, I look forward to seeing the world's score a high percentage of business in
largest democracy become a major economic acting for the underwriter on issues, when UNDE[WRITES ON IO",r . -.r
power, and the capital markets will help compared to the competition. TRANSACTIONSUAN;?;MAY 2°9"6) -siF;
fund this growth," Chrisman says. Though it might seem a law firm's size Firm Number of
In recent weeks, the Indian stockmarket would be a deciding factor in its ability to deals
has taken a beating from investors. Though source more of this growing market, the ss,RAssociates 3
the Bombay Stock Exchange (BSE) Sensex spread of business proves that this is not 1
Amarchand &Mangaldas
index reached historical highs of well over necessarily true. &SureshA Shroff &CO
12,000 in mid-May, it has since plummeted RajaniAssocia~s only has 16 lawyers and
dramatically back to under 10,000. two partners, compared withAmarchand's
AZB &l'armel'S ._---
1
With the !PO market having ridden high 31 partners from 188 lawyers, but has J Sagar Associlrtes 1
on the back of rising stock valuations and still managed to advise four companies Khaitan & Co 1
investor sentiment, :firms key to the !PO this year. 1
MIs Crawford Bayley & Co
market in India are expecting a slowdown So what do the leading firms say are
in the amount of !PO business coming P&lawOffices 1
the factors enabling them to succeed in
their way over the next three months. the market? Note:Figuresare for January to the end of May 2006
However, with these firms having built The consensus seems to be solid client Sourre: Bombay Stock Exchange

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251
IPO REPORT

Intellectual ... ill

to Shroff, was advising ICICI Bank on an issne that saw


!
I
Property UPDATE =-ATM"O Alban Tay Mabtmi & d. Silva

simultaneous offerings in the US, Japan and domestically to the


value ofUS$1.75bn. Appr9ach to imringeJ.1:l.~nt
Amarchand & Mangaldas has also played a part.in capital
markets reform over the years. The :firm was involved in drafting and registration ui1:de:rthe
the code of the Securities and Exchange Board of India (SEBD, and
more recently wrote a chapter in a revised version of the code. Sinp.po:re Trade Marks Act
Shroff says the :firm will endeavour to keep a hold on this
market, but will not necessarily put a large amount of resources

T
into growing the business too much further. "I think we're all'eady . he Singapore Court of Appeal ("CA") considered the
doing quite a lot. We have fairly large teams. If the market grows statutory requirements for infringement under Section
and needs more resources, then we will respond to that, but if the 27(2) of the Trade Marks Act (Chapter 332) ("the
market is turning down, we will divert our resources to something Act") in the case of The Polo/Lauren Co, LP u Shop In
else," Shroff says. Department Store Pte Ltd [2006] SGCA 14.
Prem Rajani from Rajani & Associates says word of mouth has Section 27(2) of the Act reads:
been the key to growing his :firm's IPO business, despite its smaller A person infringes a registered trade mark if, without the
size compared with its competition. consent ofthe proprietor ofthe trade mark, he uses in the course
While the firm is not often on the panels of the lead managers of trade a sign where because:
of transactions, Rajan,i says that ultimately delivering successful (a) the sign is identical with the trade mark and is used in relation
IPOs has helped the fu:m to gain more business. to goods or services similar to those for which the trade mark
Rajani says the:firm has six people in the capital markets area, is registered; or
and they are never short of manpower, choosing to undertake a Cb)the sign is similar to the trade mark and is used in relation to
maximum of three issues at anyone point in time. goods or services identical with or similar to those for which
J Sagar & Associates partner Somasekhar Sundaresan says the trade mark is registered, itd
being involved in IPOs means being perceived as having a full there exist.s a likelihood of confusion on the part of the public.
perspective of the entire securities market. "Most bankers are The CA examined the express wording of section 27(2), and took
comfortable working with us because we work with them on the view that there wouJd only be infringement if the following
securities market related transactions," Sundaresan says. "You three conditions were present:
can't just say you are an IPO lawyer - you have to get into all (i) the alleged offending sign must be identical or similar to the
ends of the securities market,"he says. registeredmar~ .

To this end, J Sagar & Associates holds seminars on new and (ii)both the sign and the mark must be used in re1ation to identical
evolving regulations in the securities arena to demonstrate its or similar goods or services; and
competence in the area. (ill)on account of the presence of the first 2 conditions, there
But Sundaresan also agree.<; relationships are crucial. "This exi,..~teda 1ikelihood of confusion on the part of the pu!:;lic. The
market runs on relationships,"he says. "When I have :finished a deal, 1ikelihood of confusion was to be assessed with regard to the
I don't measure it on the deal being completed, but on how many surrounding circumstances and extraneous factors such. as
relationships I was able to build during the deal," he says. trade practices.
With the stock market now under pressure, the firms will have The CA also noted that section 27(2) was similar to section 8(2)
to use these relationships to beat off competition as the market ofthe Act, which related to the refusal of registration of a mark.
tightens over the ne,,'t few months. The CA took the view that this same approach could be adopted
At present, some stocks are trading at a discount of between for the refusal of registration of a mark.
20% and 50%, virtually killing the enthusiasm for IPOs that This decision is significant as it clarifies that the same approach
gripped the market only two months ago. "The capital market is is to be adopted for trade mark infringement and opposition
big, so there is work for everyone, but because of the drop in the proceedings. A mark that fails to secure registration as a result of
market there will be a shake-out - everyone is feeling that,.big opposition proceedings based on a prior registration is therefore
or small," Sundaresan says. likely to also infringe the prior registration. However, the merit
However, players in the market are optimistic it will rebound, of such an approach is questionable as infringement proceedings
with the fundamental growth in the Indian economy leading to are considerably more expensive and
the increased need in companies for funds. onerous than opposition proceedings. .
And lawyers are well positioned to capitalise. While in the past Also query whether a Registrar's
bankers used to write most of the documents for IPOs, law firms finding that the marks are similar
are now inseparable from the market. under section 8(2) may be relied
There is even talk that the regulator SEBI could in the future upon in securing summary judgment
choose to register firms that it could recommend as counsel on for trade mark infringement under
IPO transactions. section 27(2).
So, it seems that key firms are coming to dominate the Indian
Karol Goh
IPO market. "In India, there are a number of firms in this Associate
space, but you can count the number of .firms on your hands," Intellectual Property and Technology Group
Sundaresan says. Alban TayMahtani & de Silva
With the existing reputations and experience they have built it Phone:+6565345266
Email:karolgoh@atmdlaV.l.com.5g KarQIGoh
is unlikely this will change much when the market returns. AlB

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