Ronnen Gaito is singled out by peers as a key name in Luxembourg's M&A market, particularly for international corporate and financial transactions.
Ronnen Gaito’s practice focuses on advising clients in the area of mergers and acquisitions, private equity and venture capital transactions, joint ventures, corporate finance (debt and equity offering) and fund formation, as well as corporate governance matters. Ronnen and his team have a strong interdisciplinary corporate and litigation practice with a focus on cross-border transactional disputes. Ronnen’s experience includes extensive negotiations of Series A and Series B financing for founders and venture capital firms, international group reorganisations for optimising exit strategies and providing extensive Luxembourg law advice for international law firms.
Which types of matters does your multidisciplinary practice encompass?
M&A, private equity, venture capital and securities’ transactions are, by their very nature, interdisciplinary, and they require a practitioner to be well versed in acquisition and investment techniques. In addition to the deal structuring and negotiations, we have a solid understanding of the areas of law and industries that drive our transactions, such as technology licensing, asset management, data management and GDPR, as well as financial services.
How has your role as corporate mergers and acquisitions counsel at Novartis International and SES SA enhanced your practice?
These companies are leaders in their fields of pharmaceuticals and satellite communications. Working in these roles was an opportunity to work with Europe’s most senior management and the world’s top investment bankers. I gained a solid understanding of the decision-making processes within such large organisations and the expectations of legal teams at this level of business.
Is covid-19 and the corresponding economic downturn a time to halt acquisitions or pursue them?
I do not feel there is a “one size fits all” answer since covid-19 has affected business sectors in very different ways. It seems that within the technology, data and healthcare sectors there are opportunities; however, valuations may need to be revised downwards. Venture capital is still active and is strategising the future in those sectors that are responding to needs during and after the pandemic.
Other sectors, such as real estate, transport, leisure, hotels and entertainment, may look very different after the pandemic and it is too difficult to make predictions. In the absence of an effective vaccine, it seems that many sectors will go into survival, rather than expansion, mode.
How have clients sought to continue transactions during lockdown? Have there been any notable positive or negative changes in how clients approach deals?
Lockdown had a negative impact on transactions and a slowdown was certainly felt. Deals and projects were put on hold and work shifted to reorganisation of group structures. Deal activity is slowly resuming and business activity did not hold for technology and venture capital.
In your opinion, how will shareholder activism evolve due to the covid-19 crisis?
In my professional life I have been through two major financial crises: the dot-com crash and the 2008 financial crisis. Both of these triggered a tremendous amount of shareholders activism and litigation and it is inevitable that shareholder will resort to their statutory rights, corporate governance and contractual protections that they may have negotiated to protect the value of their investments.
I believe that board decisions will be tested and corporate governance as well as risk management will be on top of the agenda of shareholder activism. Prior practices of assumption of excessive level of debt and collateralising company assets as well as company risk management are highly likely to be tested by shareholders.
How is technology driving growth in M&A?
Technology has been the ultimate driver in M&A and transactional work. Its impact is felt on the deal flow side where new technologies have driven and created so many new businesses, which spurred unprecedented growth in data-driven business, e-commerce, software, hardware, fintech and pharmaceutical, and, ultimately, trickled down into all sectors of the economy. Today, most, if not all, companies are technology businesses and they rely heavily on technology for the optimisation of their business.
The amount of information produced by companies is greater than ever and the software tools available to M&A practitioners, such as sophisticated virtual data rooms and contract analysis conducted by software, have increased the transparency in the acquired targets and accelerated the M&A process and, consequently, deal flow.
What inspired you to set up your own firm?
I saw law not only as a pure and separate discipline, but as a business that required management, marketing and finance. In addition, I wanted the challenge of building a business and building those skills that business people hone over the years, as well providing clients with the infrastructure to do cross-border business.
What advice would you offer to junior lawyers looking to pursue an M&A practice?
M&A is a field that brings legal practitioner as close as one can get to being a general legal practitioner. Young lawyers require development of a very broad set of skills and understanding of business. They ought to develop that general business acumen and understand the business drivers, financial considerations of their clients and the drivers for the decision-making process from senior management to board level.
Ronnen J Gaito is the founder of the law firm of RJ Gaito (2011), and the Luxembourg chapter chair of the international section of the New York State Bar Association.
Ronnen’s practice focuses on advising clients on private equity and venture capital transactions; mergers and acquisitions; joint ventures; corporate finance (debt and equity offering); fund formation; corporate governance matters; and post-transaction, cross -border dispute resolution and litigation.
Ronnen’s most recent experience has involved extensive negotiations of Series A and Series B financing for founders and venture capital firms; international group reorganisations for the purpose of optimising exit strategies and IPOs’ debt facilities; and negotiations of complex technology licensing agreements. He provides extensive Luxembourg law advice for major international law firms.
In addition to Ronnen’s extensive Luxembourg law experience, he has acquired global international deal experiencee as a senior corporate counsel at SES (the world’s largest satellite operator), and as corporate mergers and acquisitions counsel at Novartis International.
Ronnen’s practice includes extensive experience of delivery of international legal opinions for equity and debt issuances, and secured and unsecured debt transactions. He is a frequent panel speaker on international legal opinion practice.
Ronnen has been recognised by many publications as a leading transactional lawyer. In 2018 and 2019 Global Law Expert named Ronnen’s firm Private Equity and Joint Venture Law Firm of the Year for Luxembourg.