Practice Areas & Industries: Sullivan & Cromwell LLP

Practice/Industry Group Overview

Sullivan & Cromwell's Tax Group has a global reputation for innovative tax planning and the successful resolution of important tax controversies. Well known for its expertise in all aspects of tax practice, the group advises some of the most sophisticated corporations and individuals on their most important and most sensitive U.S. and French tax concerns.

On transactional matters, the group works closely with the Firm's General Practice and Estates and Personal Groups to deliver seamless advice that is responsive to the overall business and personal objectives of our clients. We pride ourselves on advancing solutions to tax problems that are practical - that meet the real constraints under which our clients operate.

In tax litigation, we work closely with our Litigation Group so that our clients have the full benefit of both experienced tax lawyers and innovative litigators.

Located in London, New York, Paris, and Washington D.C., the Tax Group consists of more than 35 U.S. and French tax lawyers. We are available to advise, on a regular basis, clients solely on taxation matters, as well as clients who retain Sullivan & Cromwell generally or with respect to particular transactions.

The Tax Group is ranked in the highest tier by the major law firm ranking services. The S&C team is especially "celebrated for its overall insight and breadth in dealing with the most complex transactions," according to Chambers USA 2005.

The S&C Approach

Sullivan & Cromwell's Tax Group is:

• Adept at forming tightly integrated teams with other practice groups to help S&C clients complete complex transactions in a tax-efficient manner.
• Valued for crafting practical solutions for even the most complicated issues and formulating proposals that clients can actually implement.
• Known for providing sage advice to clients on an ongoing basis and for its ability to handle follow-on matters even after the big deal has closed.
• Close to clients and responsive to their unique needs.

For information about our tax practice as it impacts executive compensation/ERISA matters or matters involving personal, charitable or family tax planning, please also see the descriptions of our Executive Compensation/ERISA Group and our Estates and Personal Group.

Rankings

Sullivan & Cromwell's Tax Group has been cited for its excellence by the following publications in the past five years:

• Chambers Global
• Chambers USA
• Practical Law Company, PLC Which Lawyer Yearbook
• The European Legal 500
• The Legal 500, Europe, Middle East, and Africa

Sullivan & Cromwell Tax Group lawyers have been recognized as leaders in their field by the following publications in the past five years:

• Chambers Global
• Chambers USA
• Euromoney, Best of the Best
• Euromoney, Guide to the World's Leading Tax Advisers
• Euromoney, Guide to the World's Leading Transfer Pricing Practitioners
• Law Business Research, The International Who's Who of Business Lawyers
• Law Business Research, The International Who's Who of Corporate Tax Lawyers
• Legalease/Legal Business, European Legal Experts
• Mondaq, Guide to the World's Leading Tax Advisors
• Mondaq, Guide to the World's Leading Tax Lawyers
• Practical Law Company, PLC Cross-Border Tax Law Handbook
• Practical Law Company, PLC Global Counsel Tax Handbook
• Practical Law Company, PLC Which Lawyer? Yearbook
• Woodward/White, The Best Lawyers in America

Professional Excellence

Sullivan & Cromwell has a tradition of recruiting the brightest stars from the best law schools and providing them with the highest quality training.

Nearly all of the Firm's lawyers spend their entire legal careers at Sullivan & Cromwell, where they adopt the Firm-wide culture of dedication to professional excellence and unwavering service to clients.

Academic institutions from which Tax Group partners have earned law degrees include:

• Columbia Law School
• Harvard Law School
• Stanford Law School
• UCLA Law School
• Université de Paris II
• University of Virginia Law School
• Yale Law School

Selected Clients, Cases & Deals

Selected Clients

Sullivan & Cromwell's Tax Group serves corporate and individual clients worldwide in a wide range of industries, including:

• energy
• financial services, including insurance
• health care
• hospitality
• manufacturing
• natural resources, including oil & gas
• publishing
• real estate
• technology
• telecommunications
• transportation
• utilities

Clients engage Sullivan & Cromwell again and again because of the trust the Firm earns by providing the best level of service and sound counsel.

The Tax Group's major clients include some of the largest global companies, such as:

• Abertis
• AIG
• Alcan
• Barclays
• BHP Minerals
• BP
• Cablevision
• Citigroup
• Deutsche Bank
• Diageo
• ExxonMobil Corporation
• France Telecom
• Goldman Sachs
• ING
• Microsoft
• Morgan Stanley
• Philips Electronics
• Pitney Bowes
• Royal Bank of Canada
• RR Donnelley
• The Securities Industry and Financial
• Markets Association
• Thomson
• UBS
• Vodafone
• Vornado Realty
• Wachovia

Selected Cases and Deals

• Created and implemented tax-efficient hybrid debt and equity instruments for many of S&C's investment banking clients, including Goldman Sachs, Merrill Lynch, Lehman Brothers and JPMorgan Chase.
• Worked in seamlessly integrated teams with the Firm's Mergers & Acquisitions Group on major transactions. Recent deals have included:
  • BlackRock, Inc. merger with Merrill Lynch Investment Managers, creating an independent asset management firm with nearly US$ 1 trillion in assets under management, making it the top fixed income manager in the U.S.
  • Goldman Sachs' acquisition of the variable life insurance and variable annuity business of Allmerica Financial Corporation.
  • GS Whitehall's acquisition of KarstadtQuelle AG, a German department store.
  • Hilton Hotels Corporation's acquisition of Hilton Group plc, a cross-border deal valued at US$ 5.7 billion.
  • NYSE/Archipelago merger in a transaction creating a for-profit, publicly held company, NYSE Group, Inc., which is 70% held by NYSE members.
  • Rhone Capital's US$ 170 million acquisition of Rexair Inc. from Jacuzzi Brands, Inc.
  • RR Donnelley's acquisition of Poligrafia S.A., Poland's third largest printer.
  • SBS Broadcasting's sale to private equity groups in a US$ 2.2 billion transaction.
  • The acquisition of France's SANEF by Spain's Abertis, a cross-border transaction involving French tax matters.

Handled numerous transactions on behalf of Real Estate Investment Trusts including:

• Purchase by Health Care Property Investors, the nation's largest healthcare REIT, of CNL Retirement Properties, the nation's third largest healthcare REIT, for US$ 5.2 billion, the largest transaction in healthcare REIT history.
• Vornado Realty Trust, an equity REIT, which along with Bain Capital Partners and Kohlberg Kravis Roberts acquired Toys "R" Us for US$ 6.6 billion.
• Vornado Realty Trust in its acquisition of a portion of First Union Real Estate Equity and Mortgage Investments.
• Currently representing a number of clients in disputes with the IRS regarding cross-border leasing transactions, including acting as counsel in one of four docketed cases that are proceeding to trial. This is one of the first cases involving the tax treatment of lease-in lease-out (LiLo) leasing transactions.

Transactional Work

In transactional matters, the Sullivan & Cromwell tax team specializes in working to accomplish both clients' business goals and their tax objectives.

Sullivan & Cromwell is among the top firms in cross-border mergers & acquisitions and investment. Both domestic and non-U.S. clients rely on S&C to handle the U.S. tax aspects of cross-border financings and domestic and international mergers & acquisitions, real estate, joint venture and partnership transactions.

Sullivan & Cromwell is also the leading firm in developing novel financial instruments and products. S&C has been prominently involved in the structuring of new securities that are treated as debt for U.S. tax purposes while still meeting various rating agency, regulatory, financial accounting or foreign legal requirements.

Due to S&C's deep understanding of the relevant capital markets, the Tax Group's lawyers are often called upon to assist banking clients in creating new products for these markets and to advise corporate clients in evaluating these newly created investment vehicles.

In recent years, the Tax Group has also played a major role in establishing a variety of investment entities for its clients and counseling them on an ongoing basis on their operation. These have included public and private investment vehicles, such as public Regulated Investment Companies (RICs) and Real Estate Investment Trusts (REITs), and private equity funds, hedge funds and real estate funds.

For more information, please see Selected Clients, Cases and Deals.

Trusted Advisors

The Tax Group attorneys serve as trusted advisors to the Firm's clients who consult with Sullivan & Cromwell on a wide range of tax issues. They value the Tax Group for its sage advice and deep understanding of clients' specific business situations.

Sullivan & Cromwell works with some of the world's largest and most sophisticated institutions, which repeatedly call on S&C attorneys because they provide clients with pragmatic advice tailored to their needs.

Due to S&C's dispute resolution expertise and awareness of legislative and regulatory issues, the Firm is well-situated to advise clients about when it is proper to set a conservative course.

Sullivan & Cromwell attorneys take the time to listen to clients, focus on their unique needs, and offer workable solutions. The Tax Group provides value by solving problems, not merely by pointing out their existence.

For more information, please see Selected Clients, Cases and Deals.

Dispute Resolution

Sullivan & Cromwell's Tax Group has been involved in all levels on dispute resolution from the audit level and IRS appeals to court litigation. The Firm takes an approach to tax litigation that differs from some of our peers. We do not have tax litigators whose experience is limited to handling tax disputes.

The Firm uses its top-level Litigation Group lawyers to bring the innovative methodologies employed in complex corporate controversies to tax disputes, where they work in close cooperation with experienced tax lawyers who are experts in the substantive tax law. We believe that this provides our clients with the best of both skill sets and is the most effective response to IRS challenges that have become more sophisticated and confrontational.

For more information, please see Selected Clients, Cases and Deals.

French Tax Practice

In addition to its U.S. tax practice, Sullivan & Cromwell has a Paris-based French tax practice which offers commercially sophisticated and globally oriented expertise in French tax matters.

The French Tax Group is highly recommended by Chambers Global, which notes that "the Tax Group's reputation in Paris is bolstered by its experience in advising major French corporates with U.S. subsidiaries and North American companies with interests in France."

This French tax practice is headed by Gauthier Blanluet, an attorney and professor of Business Tax Law at the University of Paris II, who is supported by some of the most prominent tax lawyers in Europe, including senior counsel Jean-Pierre Le Gall.

The French Tax Group combines its international perspective with French tax expertise. Known for being modern and highly responsive to clients, the French Tax Group specializes in:

• capital markets
• dispositions
• financing transactions
• international and domestic French joint ventures
• mergers & acquisitions

In addition to the Paris office, Sullivan & Cromwell has a presence in Brussels, Frankfurt and London. Approximately 100 of Sullivan & Cromwell's lawyers are based in Europe. About half of the Firm's clients are non-U.S. entities, and nearly half of those non-U.S. clients are European.

For more information, please see Selected Clients, Cases and Deals.

Contacts for the Tax Practice

For more information on Sullivan & Cromwell's tax practice, please contact Andrew P. Solomon or one of these tax lawyers:

UNITED STATES: New York Office

Ronald E. Creamer, Jr.
David P. Hariton
Jeffrey D. Hochberg
William F. Indoe
Eliyahu D. Jacobson
Andrew S. Mason
Andrew P. Solomon
David C. Spitzer
Willard B. Taylor
Diana L. Wollman

UNITED STATES: Washington, D.C. Office

Emily S. McMahon

WORLDWIDE and EUROPE: London Office

Andrew P. Solomon

EUROPE: Paris Office (French Tax Practice)

Gauthier Blanluet