19 August 2010

Cliffe Dekker Hofmeyr's local and international expertise is an advantage in large infrastructure projects in Africa

Successful bidding for a major project can often depend on the ability to offer legal representation anywhere in the world, and often in multiple jurisdictions for transactions involving several multinational corporations, plus the ability to draw on particular expertise required for a project.

Cliffe Dekker Hofmeyr's association with DLA Piper, one of the world's largest law firms, is assisting its drive into Africa, especially for large infrastructure projects where international reach is often a necessity.

In addition to its operations in South Africa, Cliffe Dekker Hofmeyr operates extensively in Mozambique, Namibia and Mauritius, has worked in a number of other African countries and is bidding for infrastructure projects in Namibia, Mozambique, Nigeria and Kenya.

Its African clients are in the private and public sectors, often involving public-private partnerships.

"Clients like to see specialist skills and competencies as well as depth of resources, and when they know we have that global footprint, with competencies in jurisdictions where they need it, that bolsters the bid," says Claire Barclay, a Cliffe Dekker Hofmeyr director working on infrastructure projects in a number of African countries.

These competencies can range from being able to prepare documents that comply with British or French law, as many African countries require, to being able to provide desalination expertise from the Middle East, energy sector expertise across the project value chain from Germany or Spain or having legal offices in the US, Canada, Japan, South Africa and China.

The combination of South African and International expertise, sourced through South Africa and priced in rands, can also be a decided advantage.

"We provide a global one-stop shop," says Kieran Whyte, a Cliffe Dekker Hofmeyr director specialising in energy projects in sub-Saharan Africa, which are usually complex, cross-border infrastructure contracts. They also include renewable energy projects - solar, wind and biomass electricity generation - which are becoming an increasing focus in Africa.

"Through our link with DLA Piper, we can provide a seamless, wide range of specialist knowledge cheaper and quicker than if the client had to directly engage an international legal firm. We cut time and costs for the client while ensuring access to international best practice, and that makes it attractive.

"We are in Africa and can provide African expertise. When you add to that our ability to operate cross-border on major infrastructure projects, and to ensure international best practice, that's another attractive attribute for the client."

Claire Barclay says law firms operating in Africa need to be able to provide a truly global service.

"For instance, we handled an enquiry from a client interested in buying a mine in Namibia. The client is based in Japan, the mine's current owner is a company listed on the Namibian and Australian exchanges, and its parent is listed in London and Canada. This is the profile of companies entering the African market."

Transaction advisory services on large projects often involve consortiums comprising legal, technical, financial and other project specific expertise. Cliffe Dekker Hofmeyr is the lead company on a number of projects, while its Africa expertise and DLA Piper affiliation make it a sought after partner when other firms are assembling a bid team for African projects.

The South African firm is currently advising authorities in Mauritius on the contractual requirements and project documents for a new harbour bridge, a new ring road around the capital, Port Louis, an electronic road tolling system and an extension to the cargo terminal.

"The Mauritius projects market is really taking off, as there are a number of substantial projects being brought to market. In advising the Mauritian authorities, the legal workstream are required in addition to undertaking a feasibility study of the project, to advise on the procurement process, preparation and negotiation of project documentation and ensuring that the project is financed in an affordable way," says Claire Barclay.

"These are essentially engineering projects, but they also involve a whole host of legal issues including tax, insurance, sector specific regulatory, administrative law, environmental, property, and labour and heritage issues. "

Cliffe Dekker Hofmeyr is also advising on two large infrastructure projects in Namibia, including clients involved in uranium mines in the region.-

In one project, the firm is advising on the financial process to secure the substantial funding required for the extensions to a port terminal. This involves speaking to development finance institutions, export credit agencies as well as commercial lenders and securing the most favourable funding for the port extensions.

Cliffe Dekker Hofmeyr has won these transaction advisor contracts against bids from South African and international firms. It always works with a legal firm in the client country, as local expertise is an essential component of the work.

"Clients, whether in the private or public sectors, want high level specialist input on projects of this size, and realise they need both local and international expertise," says Kieran Whyte.

Cliffe Dekker Hofmeyr was formed in 2008 through the merger of two South African law firms, Cliffe Dekker and Hofmeyr, Herbstein and Gihwala. This resulted in one of the country's largest law firms with more than 130 directors and 300 lawyers based in Johannesburg and Cape Town.

The merger further boosted the 2005 association with DLA Piper, which has more than 3 500 lawyers in 29 countries worldwide and operations across Asia, Europe, the Middle East and the United States. Cliffe Dekker Hofmeyr is the South African member of DLA Piper Group, which has a network of firms across the African continent.

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