fivehundred magazine > Practice area spotlight: M&A > Restructuring is key for Jersey firms

Restructuring is key for Jersey firms

But the consolidation of insurance and fiduciary businesses is also significant, along with developments in FinTech and cryptocurrency, explains Wendy Benjamin

Please give us an overview of the current legal market in Jersey and how any recent developments have impacted your practice?

2017 was a relatively busy year for Jersey M&A activity, reflecting the global market. Despite the current global geopolitical and regulatory concerns, the high number of deals seen in the last three years is looking to continue throughout 2018.

There have been no material legal developments in the M&A space in Jersey. However, a new demerger regime for Jersey companies will come into force on 1 September 2018 (pursuant to the Companies (Demerger) (Jersey) Regulations 2018), which may provide an alternative to a court-sanctioned scheme of arrangement. As these regulations should result in significant cost and time savings for those looking to divide the undertaking, property, rights and/or liabilities of a Jersey company, we may see a rise in the number of restructurings of Jersey companies. We note that certain Jersey companies will not be able to utilize these new regulations, including companies registered to carry out banking business in or from within Jersey and companies holding a permit to carry out insurance business in or from within Jersey.

New limited liability partnerships legislation is also expected to come into force in the second half of 2018, which will also modernise Jersey’s limited liability partnership laws and aims to make Jersey LLPs more competitive for use as a vehicle of choice.

What significant trends exist in the M&A market presently? Are you seeing these just domestically or internationally as well?

We are seeing continued consolidation between fiduciary and fund services providers on the Island. There is also a large amount of insurance restructuring and consolidation taking place, which reflects the position in the UK surrounding Brexit. Jersey is also working to establish itself as a leading FinTech and cryptocurrency hub (with a number of ICOs having occurred on the Island in the first half of 2018), which may open new opportunities for watchful buyers.

What advice would you give to the next generation of M&A lawyers?

When encountering issues on transactions, be practical and commercial – clients generally only want to hear about an issue once you’ve found a suitable workaround solution. In addition, stay informed on the current trends in the market and keep on top of what the big players in the various sectors are doing (reading the Financial Times is useful).