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Dee Rajpal, a lawyer with Stikeman Elliott LLP in Toronto, is the firm's point-man for drawing in business from India. (Tim Fraser for The Globe and Mail)
Dee Rajpal, a lawyer with Stikeman Elliott LLP in Toronto, is the firm's point-man for drawing in business from India. (Tim Fraser for The Globe and Mail)

THE LAW PAGE

Bay Street firms have eyes on India Add to ...

It would be India’s first big step into the oil sands.

Recent reports from Indian media and international wire services say India’s state-owned Oil and Natural Gas Corp. Ltd. is among the bidders pursuing a $5-billion share in Alberta oil sands concessions owned by Houston-based ConocoPhillips Co.

The potential deal is the latest in a series of rumoured possible major investments by Indian firms in Alberta’s oil patch.

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And it is being closely watched by Bay Street’s top law firms, several of whom have made aggressive moves to capture the attention of potential Indian clients in recent years, sending teams on regular trips. Connections in India are now seen as a key component of their international strategies, as more new investment from the country is expected to flow into Canada. And Canadian law firms are in fierce competition with each other to win the legal work that goes with that business.

Mergers and acquisitions involving Indian companies in Canada have increased since the middle of the last decade, when Indian giants such as the Tata Group made a series of Canadian deals. But activity has cooled as global economic uncertainty has grown.

Bay Street lawyers who travel regularly to India insist it is only a matter of time before the deal-making heats up. Two-way trade between India and Canada continues to increase, approaching $5-billion in 2011. A free-trade deal, now in talks, could be ready for signatures next year. And it is no secret that India, an energy importer, is keenly interested in Canada’s oil sands.

Dee Rajpal, one of two lawyers heading up Stikeman Elliott LLP’s India initiative, says the time is ripe for an uptick in merger-and-acquisitions activity in Canada by Indian companies. For one thing, they tend not to be dependent on the shaky European credit market for financing, he said.

He has been involved in a number of large Indian investments in Canada since his law firm adopted a more aggressive India strategy in 2005. Among them are Mumbai-based Essar Global Ltd.’s $1.85-billion 2007 acquisition of Algoma Steel Inc., and a $4.9-billion mining joint venture announced last year between Tata Steel and Calgary-based New Millenium Iron Ore Corp. in Newfoundland and Labrador and Quebec.

Mr. Rajpal says some mid-size Indian mining firms have recently mulled listing on the Toronto Stock Exchange, or even staging a reverse takeover to secure a listing. And there is no question, he says, that major Indian companies have shown interest in a major oil sands deal: “Over the last number of years … several major players from India have certainly kicked the tires on major transformational transactions.”

Canadian law firm Blake Cassels & Graydon LLP also has a long list of Indian deals it has worked on in recent years, dating back to the landmark 2005 acquisiton of Teleglobe International Holdings Ltd. by Tata Group’s Videsh Sanchar Nigam Ltd.

Montreal lawyer Sunny Handa heads up the Blakes India team, and has travelled to India on trade missions with Quebec Premier Jean Charest. He agrees the worldwide economic uncertainty has reduced the number of transactions. But he is currently working on a “massive” potential Indian investment in Canada, which he could not disclose.

However, he acknowledges that doing business in India is not always easy, despite the common language and the similar legal and political systems. “You definitely have to have people who know the country and are comfortable with the culture, or who are willing to get comfortable with the culture,” Mr. Handa said.

Foreign law firms are not allowed to actually practise law in India, and must instead work with local law firms. This is why, unlike in other countries, Canadian law firms have not opened their own offices in India.

Another problem is the fact that Canada’s profile overall in the country remains low, lawyers who do business there say.

Peter Sutherland, a former Canadian high commissioner to India and now a senior business adviser with Toronto law firm Aird & Berlis LLP, said government, businesses and law firms are working to change that.

“The whole world is courting India, just like they are courting China, so it’s hard to get their attention,” said Mr. Sutherland, vice-chairman of the Canada-India Business Council. “There’s a lot of goodwill for Canada … [but] there hasn’t been as much business as we would like to see. And consequently it’s hard to get as much mind-share as the U.S., or the Brits or even the Australians.”

Toronto lawyer Raj Sahni, who spearheads Bennett Jones LLP’s efforts in India, says any law firm expecting a few trips to Delhi to quickly produce a bounty of mega-deals is going to be disappointed. Indian companies are not as flush with cash as Chinese ones, he said.

“We’ve taken a long-term approach … and that is the way you’ve got to do it,” he said. “The deals are going to come but they are going to be slow coming.”

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