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Wachtell, Latham Take Lead in Uber’s Postmates Purchase (1)

July 6, 2020, 4:38 PMUpdated: July 6, 2020, 8:37 PM

Wachtell, Lipton, Rosen & Katz is advising Uber Technologies Inc. in a $2.65 billion all-stock acquisition of the meal delivery service company Postmates, Inc., which is represented in the deal by Latham & Watkins.

The deal will boost Uber’s food delivery service capabilities in the company’s bid to compete with DoorDash, the current market leader in the U.S. Uber previously failed in a bid to acquire GrubHub Inc., a privately-held company that was later purchased by Netherlands-based Just Eat Takeaway.com.

Uber has cut more than a quarter of its staff since the beginning of the coronavirus pandemic, and pared back certain projects including those in financial services, according to Bloomberg.

It’s also been mired in litigation and regulatory battles over the classification of its drivers. The company has been pushing back against California’s A.B. 5 law, which makes it harder to classify workers as independent contractors.

The California Public Utilities Commission published an order in June determining that Uber drivers are covered by the law. The company was later hit with a proposed class action by a food delivery worker arguing that Uber Eats drivers have been misclassified as contractors and denied benefits like overtime pay.

In getting the work on the Postmates acquisition, Wachtell and Latham have notched a win amid a major overall slowdown in M&A. According to Bloomberg data, deals have plunged since the coronavirus outbreak became widespread in the U.S. in March, with global deal activity in the first half of the year dropping to $1.1 trillion from $1.9 trillion in the same period in 2019.

Deals in the technology sector, like the Postmates transaction, accounted for $111.9 billion of all M&A deals in 2020.

The Wachtell team on the Uber deal is led by New York-based corporate partners Andrew J. Nussbaum, whose recent work has included advising Salesforce in its $15.7 billion purchase of analytics platform Tableau, and Mark A. Stagliano. They are joined by antitrust partner Joseph D. Larson, executive compensation and benefits partner Michael J. Schobel, finance partner Michael S. Benn, intellectual property counsel Selwyn B. Goldberg, litigation partner Ian Boczko, and tax partner Jodi J. Schwartz.

The Latham & Watkins team representing Postmates is led by Bay Area corporate partners Tad Freese and Chad Rolston. Advice was provided on antitrust matters by partner Joshua Holian; on tax matters by partner Grace Lee; on benefits and compensation matters by partner James Metz; on intellectual property matters by partner Anthony Klein; and on data privacy matters by counsel Robert Blamires.

Latham’s global vice chair of M&A Luke Bergstrom recently told Bloomberg Law that the firm’s deal lawyers have remained busy thanks to their tech and life sciences focus.

“It’s surprisingly been robust for a number of pockets within our global platform,” he said.

(Added new information throughout about Uber's recent legal and business challenges as well as about firms and lawyers involved in the deal.)

To contact the reporter on this story: Stephanie Russell-Kraft in New York at srussellkraft@gmail.com

To contact the editor on this story: Rebekah Mintzer in New York at rmintzer@bloomberglaw.com;
Chris Opfer in New York at copfer@bloomberglaw.com

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