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Deal 5: C3's Executive Director of Corporate Development on Acquisition of Majority Stake in PM

Deal 5

On June 30, 2016, CEE Legal Matters reported that Selih & partnerji had advised German company C3 on its acquisition of a majority stake in PM, Slovenia’s largest content marketing agency, making C3 the biggest content marketing agency in Europe.

Christian Brugger, Executive Director of Corporate Development at C3, kindly agreed to answer our questions:


Tell us a bit about the drive behind the deal. Why Slovenia and why PM in particular as the target of your expansion? 

Piotr WitkowskiC.B.: We’ve known PM's managing directors Igor Savic and Primoz Inkret for a couple of years before the deal and were always very impressed with the outstanding work they provide for their clients. We also understood quite early in these regular interactions that we share a common strategic perspective on the marketing market and its future development. During that period we also worked together with PM on various client opportunities and projects. Hence this transaction was the vehicle to strengthen the ties between us. Within the C3 agency network PM will now be the part driving further growth in the attractive Slovenian market as well as further expansion of the business into the Western Balkans region. 


According to the press release announcing the deal, "talks regarding capital ties and a strategic-development partnership between C3 and PM ran for more than a year.”  How much of that was spent on your due diligence and how much on the negotiations of the actual terms of the deal? Did they run in parallel or was one concluded prior to the other in this case?

C.B.: As indicated in the previous question the process of our discussions was very smooth as the transition between high-level strategic thoughts on joining forces, joint project work for individual clients, and actual drafting of the appropriate deal structure and terms was a gradual process. We were under no specific time pressure and rather wanted to make sure we get the right structure and terms in place to reflect the partnership approach for our joint undertaking. We spent roughly 4 weeks on the actual due diligence and continued fine-tuning the structural elements in parallel.


Are we likely to see further similar steps to strengthen your position in CEE? If so, what were your main takeaways about the specifics of the region from this deal that you will be applying in the future?

C.B.: We have recently opened a C3 office in Prague to serve our key client Skoda, among others, directly from this local subsidiary. Our Prague and Ljubljana teams will now jointly drive business in the CEE region developing further client relationships and project opportunities. Further inorganic activities would then be considered opportunistically as they arise.


Did Selih & partnerji represent you directly on negotiating the terms of the deal or only on applying them to the relevant framework? How did you assign the responsibilities between your in-house team and your external advisors?

C.B.: We worked very closely with the Selih & partnerji team on fine-tuning the transaction structure and terms to make them fit our strategic intention for this deal. Our in-house team mainly focused on the commercial elements of the transaction and the Selih team was responsible for advising us both on the due diligence as well as on the SPA drafting and negotiations, providing the required legal expertise in specific matters as well as for local particularities.  


How will you manage the legal needs of the new Slovenian member? Will you rely on the existing structure? Will you rely on ongoing external counsel support? And so on. 

C.B.: PM is a strategically well-positioned and well-functioning agency, hence we will mostly rely on the existing structure. We would rely on external counsel support only if deemed necessary for specific legal matters. 


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