Editor: Please tell us about your background and how you came to be partner-in-charge of Jones Day's Singapore office.
Jobanputra: I practiced for 12 years in Toronto and another five in London, working with Linklaters and Barclays Capital, before deciding to move to Asia. I joined Jones Day in February 2009 and then moved to Singapore. I am now one of ten women who run an office or a region for Jones Day. Ten is quite exceptional for an international law firm, and I am honored to be among them. Almost a third of Jones Day's offices are run by women, which is a phenomenal statistic.
Editor: Please describe the Singapore office's current practices.
Jobanputra: With 17 lawyers, we are one of the larger international firms in Singapore. In addition to my practice in banking and finance, two of our partners practice in capital markets and the other two in M&A/PE. We handle all aspects of these matters - from cradle to grave - including fund formation, structured financing, leveraged finance, workouts, debt restructurings, divestitures, securities transactions and general corporate/M&A. Two additional oil and gas partners split their time between Hong Kong and Singapore, enabling us to serve the critical energy sector.
Editor: How does Singapore fit into and coordinate with Jones Day's Asian network and how do you work with the U.S. offices and your clients in the U.S.?
Jobanputra: Jones Day's "One Firm Worldwide" structure enables Singapore-based lawyers to collaborate seamlessly with the firm's 2,500 lawyers in 34 offices across the Americas, Europe, Asia, and Australia. The firm's "no profit center" philosophy nurtures this culture of cooperation. For example, our practice groups hold regular meetings that connect lawyers in each substantive area with their peers in other offices. New matters are staffed across offices (and sometimes continents) in order to assemble the absolute best team, which often includes consulting with our U.S. experts in specific niche areas. Examples of international deals involving the Singapore office include:
Advising Proctor & Gamble (P&G) on an investment in Southeast Asia
Advising Temasek on its US$1.5 billion investments in two separate private placements by Chesapeake Energy Corporation (USA) and on the subscription of US$300 million in convertible debentures issued by Niko Resources, a Canadian oil and gas company
Advising Up Energy Group Ltd, with mining assets in Xinjiang, China, in a capital restructuring and senior debt financing as part of their business combination with Tidetime Sun (Group) Limited
Micron's acquisition of Numonyx Holdings
Coherent's acquisition of the assets of Singapore-based Hypertronics Pte Ltd.
Editor: Please tell us about activity in China and India.
Jobanputra: China and India both have huge energy requirements, which are just going to increase in the future. Therefore, there is a lot of activity in the energy sector, including project financing and M&A. Both China and India have growing middle and upper classes that create wealth as well as an increased demand for consumer goods, such as cars and luxury products. I call them emerging powers - in contrast to the stable or shrinking markets in the West. We are now seeing an increased trend for Chinese and Indian businesses to look for assets not only in Europe and the U.S. but also in other emerging markets such as Indonesia and Brazil.
Editor: Is it true that focus has shifted from BRIC (Brazil, Russia, India and China) to BIIC countries, with Indonesia coming to the fore?
Jobanputra: Absolutely. Indonesia has the world's fourth largest population and a wealth of resources, including oil, gas and coal. It is the best performing economy after China and India among the G-20 countries - outpacing both Brazil and Russia. Indonesia's US$695 billion economy grew at 6 percent in 2010, with trade between Indonesia and China more than doubling to US$25.5 billion from 2005 to 2010. During the same period, U.S.-Indonesia trade rose around 20 percent to US$18 billion. All of these countries have resources and are looking for western infrastructure capital and technology, which creates opportunities for our clients.
Editor: How has Southeast Asia come through the recession and what opportunities do you see for American companies?
Jobanputra: Singapore's economy enjoyed a strong rebound in the first half of 2010. While part of this is cyclical, reflecting the re-stocking of inventories globally, Singapore's recovery is testimony to strong underlying fundamentals.
Singapore's resilience through the crisis, which allowed markets to benefit from a modest recovery in the advanced economies.
For the first time, Asia has led a global recovery. Asia's own turnaround is more entrenched and has progressed further than that of the advanced economies.
Intra-Asian trade and investment outpaced growth in Asia's trade with the rest of the world. The Asian regional economy is now a driver in its own right. And this is not just a short-term phenomenon; it is a longer-term shift that reflects the growing importance and integration of the regional markets.
The quick and successful recovery reflects strong economic fundamentals in the Singapore economy, buttressed by years of reform post the Asian Financial Crisis. Having little inherent vulnerability, Singapore's economy withstood the recent financial shocks well.
Asia's regional recovery looks poised to strengthen, which will create opportunities for businesses and investors.
2010 GDP growth percentages: Singapore: 14.6, U.S.: 2.8, EU: 1.7, India: 8.3, Indonesia: 6 and China: 10.1 (Source - IMF).
Regarding opportunities for American companies, in 2010 the U.S. Government produced a white paper as part of its "National Export Initiative," identifying nine countries that represent the greatest export growth opportunities for American companies. Three of these (Indonesia, Vietnam and India) are serviced by Jones Day's Singapore office. Sector opportunities for American companies include consumer products, automotive, energy, infrastructure and telecommunications.
Editor: Would you talk about Singapore's importance as the infrastructure center for Southeast Asia as well as for India?
Jobanputra: Singapore consistently earned a top spot in international ranking reports, reaffirming the country's role as a key business hub in Asia and beyond. This performance may reinforce confidence in foreign investors to set up regional offices and operations in Singapore and leverage substantial business benefits. Singapore is a short flight from Indonesia, Vietnam and the other ASEAN countries, making it a logical hub for Southeast Asia, as Hong Kong is for North Asia.
Singapore's government embraces this role. Its new international arbitration center is seen as one of the best in the world. The government is efficient and Singapore's legal system is trusted (Singapore, alongside Denmark and New Zealand, top the global index of least corrupt nations). Since foreign lawyers cannot practice in Indonesia or in India, international firms have set up in Singapore, practicing New York and English law. Finally, Singapore's business-friendly regulatory regime encourages hedge funds and private equity funds to set up offices in Singapore.
Editor: Can you describe the current environment for cross-border M&A?
Jobanputra: M&A activity increased over the past three to six months, and the pipeline looks strong. While natural resources are steadily busy, areas such as consumer products and services are increasingly active. Buyout activity is up, including secondary sales (i.e., one buyout fund selling a company to another buyout fund). Unlike slumping Europe and the U.S., Asian M&A boomed in 2010, evidencing a global shift in activity post the credit crisis. Asian activity should continue this year as chief executives shift focus from sluggish domestic economies toward faster-growing markets. According to Dealogic, 2010's M&A activity in Asia-Pacific compared well with other regions, accounting for 30 percent of global M&A activity versus 20 percent in prior recent years. India has emerged as the world's 21st largest outward investor, with more than US$75 billion overseas investment in the past decade.
Foreign direct investment (FDI) equity inflows into India from April 2000 to October 2011 stood at US$123 billion. India ranked second in global FDIs in 2010 and will remain attractive to international investors during 2011-12, according to the United Nations Conference on Trade and Development. Private equity returns are good in Asia. Chinese, Indian and Indonesian governments are paying more attention to transparency in terms of management and corporate governance. They understand the need for greater due diligence and scouting, given their desire to seek capital from foreign investors.
Proceeds from IPOs in Asia excluding Japan in 2010 were the highest on record, beating 2007 proceeds of US$93.3 billion and capturing 62 percent of market share. The trend highlights investors' enthusiasm for equity offerings that give exposure to emerging market growth. Following are some highlights:
In Malaysia, Petronas Chemicals announced plans to raise US$3.4 billion in an IPO, the largest on record in the country. Malaysian IPO proceeds in 2010 reached US$1.4 billion from 23 issues, just below the last record of US$1.5 billion raised in 2002.
In Singapore, Global Logistics is to raise US$2.64 billion, the largest IPO on its exchange since the 1993 listing of SingTel in 1993, which raised US$2.67 billion.
In India, the Coal India IPO raised US$3.8 billion, the country's largest IPO on record. The previous record was held by Reliance Power, which raised US$2.92 billion in 2008.
In 2009 and 2010, Jones Day closed 34 Indian capital markets deals with an aggregate value of over US$4 billion, and for each year between 2007 and 2010, the firm ranked number one among international firms based on the number of completed Indian equity share offerings.
Editor: What is happening with the energy sector, both in terms of Southeast Asian development projects or Asian oil companies' overseas investments?
Jobanputra: In the next few decades, China and India will be the largest energy consumers, and they are in a race to capture global resources from Africa, the U.S., Indonesia and elsewhere. An Indian company is involved in a US$5 billion dollar coal mining project, a Chinese company is looking to invest several billion dollars in Africa, and Jones Day raised US$3.6 billion for an Indonesian coal mining company that we regularly represent.
Editor: Where do renewable resources fit into the overall business and legal landscape? Which country stands to emerge as dominant in this area?
Jobanputra: In China, wind and solar are becoming more prominent, and bio-fuels generally are on the rise. The Indian government recognized that non-renewable energy resources are not sufficient to meet the needs of their growing population and has issued public policy statements about increasing investment in the renewable sector to meet five percent of their needs. Five percent of 1.2 billion people's needs is very significant, so these statements need to be placed in perspective, not only in terms of demand but as increasingly viable strategies in the wake of increased energy prices. In China and India, there is a desire to control pollution but an aversion to hampering business, so they are struggling to achieve the right balance.
Editor: How does the firm manage its diversity policies in the Singapore office?
Jobanputra: We are the United Nations. Since our office is a hub that serves so many jurisdictions, our office population reflects this in its diversity. Our 17 lawyers represent eight nationalities, including English, Canadian, American, Filipino, Singaporean, Australian, New Zealander and Indian.
Editor: How does the Singapore office embrace the Jones Day One Firm Worldwide philosophy in the arena of global and local community service?
Jobanputra: The firm very much encourages community involvement and pro bono activities, and our office is no exception. I am involved in a Singapore women leadership project, fostering learning within the community and mentoring young, up-and-coming women. In terms of how we fit into this Jones Day One Firm Worldwide, 75 percent of our transactions are done with other offices. Either the transaction originated in Singapore and required the assistance of experts or colleagues in other offices or visa versa. For example, an associate and I were working on a deal and trying to finalize a document. It was after midnight and another associate, who was not involved in the deal, came by and offered to stay and help as he had just finished what he had to get to a client that day. The firm rewards that kind of team spirit and therefore loyalty to the client to get the job done and deliver the best product for our clients. This collaborative spirit is a top-down message at Jones Day.