Lawyers from Hartman, Simons, Spielman & Wood and Sutherland are the legal advisers on the bankruptcy court-approved sale of a Georgia natural gas marketer.

Sutherland partners Tom Byrne and Knox Dobbins advised MXenergy Inc. on its agreement to acquire Catalyst Natural Gas LLC for about $2 million. Hartman Simons partners Sam Arden and Joe DeLisle were counsel to Catalyst on the deal. The sale has received approval from U.S. Bankruptcy Court Judge Joyce Bihary and from the Georgia Public Service Commission.

Catalyst, of Atlanta, filed for Chapter 11 protection on Oct. 1 in U.S. Bankruptcy Court for the Northern District of Georgia. Catalyst was a natural-gas marketing company that had served 34,000 customers in Georgia. MXenergy, of Stamford, Conn., provides natural gas and electricity in the U.S. and Canada.

In addition to the sales agreement, a host of Atlanta-area attorneys are advising clients in the Catalyst bankruptcy proceedings.

Jones & Walden partners Leon Jones and Denise Dotson are bankruptcy counsel to Catalyst, while Powell Goldstein partner Robert Mercer is legal counsel to the official committee of unsecured creditors to Catalyst.

Cohen Pollock Merlin & Small partner Gus Small is representing interested party Gas South LLC, which said in a court filing that it estimates that it’s owed about $1.5 million by either Atlanta Gas Light or by Catalyst. That debt is a result of Catalyst under-supplying the natural gas system shared by the state’s gas-marketing companies, Small wrote in a court filing on behalf of natural-gas marketer Gas South.

McKenna Long & Aldridge partners Gary Marsh and Craig Dowdy and associate David Gordon are counsel to creditor Atlanta Gas Light Co.

Rogers & Hardin partners Kimberly Myers, Tony Powers and Robert Remar are representing creditor Georgia Natural Gas, a unit of SouthStar Energy Services.

King & Spalding partner Paul Ferdinands is counsel to creditor SCANA Corp.

Morris, Manning & Martin partners Becky Patrick and David Rabin are counsel to Infinite Energy Inc. on litigation it filed against Catalyst. Hartman Simons partner David L. Pardue is defending Catalyst in the Infinite Energy litigation.

Scroggins & Williamson partners Robert Williamson and Hayden Kepner are counsel to interested party Constellation Energy Commodities Group Inc. McDermott Will & Emery partners Nathan Coco in Chicago and Robert Stephens in Houston are also advising Constellation Energy.

Troutman Sanders partner John Mercer advised Wisconsin Electric Power Co. on a $300 million securities offering.

The electric utility said in a regulatory filing that it plans to sell $300 million of unsecured debentures at 6 percent due Apr. 1, 2014. Wisconsin Electric Power will use the proceeds from the offering to “repay short-term debt, for working capital and for other general corporate purposes, including the payment of dividends,” according to a prospectus.

Troutman associates Patrick Macken and Brad Resweber assisted Mercer. All three Troutman lawyers work out of Atlanta. Dewey & LeBoeuf is advising the underwriters, Citigroup Global Markets and Wachovia Capital Markets.

Wisconsin Electric Power is a subsidiary of Wisconsin Energy Corp. Wisconsin Electric Power sells electricity to more than 1.1 million customers in its home state and in the upper peninsula of Michigan.

David Stockton’s client, an Appalachian coal mining company, got in just under the wire.

James River Coal Co., the morning of Monday, Sept. 29, raised $44 million through the sale of 1.5 million shares of common stock. The deal happened just in the nick of time, said Stockton, a corporate partner at Kilpatrick Stockton in Atlanta. That’s because later that Monday, the Dow Jones Industrial Average dropped 777.68 points, its largest one-day drop in history, after the U.S. House of Representatives rejected a $700 billion bailout bill for the financial sector.

“The sale closed on Monday morning, and then the market tanked that afternoon,” Stockton said. “If [the James River securities offering] had not closed on Monday until the end of the day, there could have been problems.”

What had made James River’s securities sale possible was a recent rise in the company’s stock price along with rival coal companies. Coal stocks had risen in the past year because the price of coal had risen. That paralleled an increase in price of oil, Stockton said.

James River’s stock had risen significantly over the past 12 months, touching a 52-week high of $62.83 per share in late June, Stockton said. With its stock price up, that made it an opportune time to proceed with a stock sale, Stockton said. James River’s investment bank, UBS Securities LLC, made the decision on Monday morning to proceed with the stock sale.

Mining disasters that occurred in Kentucky and West Virginia in 2006 indirectly led to James River’s decision to raise capital through a stock sale. Because of increased health and occupational safety regulations that were implemented in the wake of the Kentucky Darby and Sago mine disasters, coal companies have had to boost spending to comply with the new rules.

“These new regulations have been very costly and have required major capital expenditures,” Stockton said. “They have been a major financial burden for the coal companies.”

According to a regulatory filing, among the expenses that James River incurred from the new regulations were: constructing and maintaining caches for the storage of additional self-contained self rescuers throughout underground mines; installing rescue chambers in underground mines; and installing cable lifelines from the mine portal to all sections of the mine to assist in emergency escape.

Working with Stockton on the securities offering was Kilpatrick associate Josh Galante in New York. Cravath, Swaine & Moore advised UBS.

James River is headquartered in Richmond, Va., and operates 15 underground mines and 11 surface mines in Kentucky and Indiana. James River’s largest customer is Georgia Power Co., according to regulatory filings.

In the hunt for renewable source materials to make biofuels, researchers are leaving no stone unturned. Everything from green algae to switchgrass to corn stalks is being studied for its potential as a commercially viable fuel.

Another potential source material is grease, which is what drove a recent deal made by a McKenna Long & Aldridge client.

American Proteins Inc. in Aug. sold three facilities in Georgia that collect used cooking oil from restaurants and turn it into yellow grease. The assets were acquired for an undisclosed price by Darling International Inc. of Irving, Texas.

While traditionally used for animal feed, yellow grease can also be used to make biofuels, said McKenna partner Jeremy Silverman. Consequently, the market for yellow grease has risen dramatically in the past year, he said.

Silverman was lead corporate counsel to American Proteins, along with associates Trey Wainwright, Doug Eingurt and Stacey Robinson. McKenna has been a legal advisor to American Proteins since 1982, Silverman said. Weil, Gotshal & Manges advised Darling.

American Proteins, of Cumming, is the largest U.S. processor of poultry by-products. Darling collects and recycles animal by-products and used cooking oil from restaurants, butchers and grocery stores and then re-sells tallow and meat, bone and blood meal. Darling also provides grease trap cleaning services.

During the past seven months, when Alston & Bird and its client EnergySouth Inc. have been accepting and analyzing bids to acquire the natural gas company, a host of private-equity funds and other so-called financial buyers took turns kicking EnergySouth’s tires.

But in the end, the winning bidder for EnergySouth wasn’t a private equity fund. Instead, as seems to usually be the case these days, the winning bid came from a company that operates in the same industry as EnergySouth, known in the M&A world as a strategic buyer.

Last month, EnergySouth, of Mobile, Ala., agreed to be acquired by Sempra Energy of San Diego for $510 million in cash. Sempra will also assume about $224 million of EnergySouth’s debt. The offer does not come with a financing contingency and both companies’ boards have approved the deal. EnergySouth owns underground salt dome caverns on the Alabama Gulf Coast that are used the storage of natural gas. EnergySouth also distributes natural gas in the Mobile, Ala. area. Sempra owns Southern California Gas and San Diego Gas & Electric and also owns and operates liquid natural gas terminals.

Alston partners Hill Jeffries and Justin Howard in Atlanta are lead corporate counsel to EnergySouth. The company is a new client for Alston. Jeffries said he met EnergySouth General Counsel G. Edgar Downing Jr. at a recent meeting of the American Gas Association and the two struck up a friendship.

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One of the biggest U.S. coal-mining companies tapped Troutman Sanders to provide advice on two securities sales.

Troutman Sanders partners David Carter and David Meyers are lead counsel to Massey Energy Co. on the planned transactions. Carter works out of Troutman’s Atlanta and Richmond, Va. offices; Meyers is in Richmond. Partners Mason Bayler and Jamie Canup in Richmond and associates Heather Ducat, Bo Griffith and Erica Jackson in Atlanta were also involved.

Massey Energy, based in Richmond, is selling at least $850 million in common stock and convertible debt in two separate offerings. Simpson Thacher & Bartlett is advising the lead underwriters on the securities sales, UBS Securities and J.P. Morgan Securities.

Massey Energy said that proceeds could be used for two purposes, to repurchase about $335 million in debt, or to cover legal fees. The fees stem from a July 2007 jury decision to award about $220 million in damages to Wheeling-Pittsburgh Steel Corp. In 2005, Wheeling-Pittsburgh had sued a Massey Energy subsidiary related to disagreements over a coal-supply contract. In May 2008, the West Virginia Supreme Court declined to hear Massey Energy’s appeal of the jury awards. Massey Energy has since said it will petition the U.S. Supreme Court to hear the case.

Massey Energy’s securities sales come as the company’s stock has been soaring. Through Aug. 8, Massey Energy’s stock has climbed about 234 percent in the past 12 months, one of the largest gainers in the S&P 500 Index, according to Bloomberg News. Massey Energy has said that it plans to increase annual production about 25 percent to 50 million tons, up from 39.5 million tons in 2007, to take advantage of soaring coal demand and prices.

Massey Energy operates coal mines in Kentucky, Virginia and West Virginia. The company is the fourth-largest U.S. coal miner, and the largest operator of coal mines in central Appalachia.

Seems like King & Spalding can’t open new offices fast enough. Atlanta’s biggest law firm has opened eight offices since 2007, including three in the Middle East—Dubai, Riyadh and, the latest, Abu Dhabi. One reason for the new outposts in the United Arab Emirates and in Saudi Arabia is the firm’s longstanding Islamic finance and investment practice.

Its new Middle Eastern offices notwithstanding, other King & Spalding offices also do Islamic finance work. The London office has cranked out work for Suez Energy International and Mitsui & Co. on a water and electricity project in Qatar; and for United International Bank of Bahrain on acquiring a controlling interest in a company that makes systems for filling and reconditioning liquefied propane gas cylinders.

Corporate partner Mark E. Thompson, an Atlanta native, works in the London office where he co-chairs the firm’s private-equity practice group. Thompson and his Atlanta-based colleague Raymond E. Baltz Jr. were lead counsel on another deal for a Middle Eastern client. King & Spalding advised Arcapita on the Bahrain private-equity fund’s acquisition of Scottish oil-well construction company Downhole Products Ltd. Arcapita acquired Downhole on behalf of its portfolio company, Varel International of Dallas. British law firm Herbert Smith advised Royal Bank of Scotland on its financing of the deal.

We spoke with Thompson about Islamic investments, the European market for private-equity deals and the work done by lawyers in King & Spalding’s London office.

Herbert Smith, RBS’s counsel on this deal, issued a legal alert that said in most U.K. leveraged buyouts involving Islamic finance firms, such as the Arcapita-Downhole deal, British banks have not provided Shari’ah-compliant financing. Instead, the banks used offshore vehicles for financing. Why do LBOs in the U.K. rarely use Shari’ah-compliant financing? Isn’t Shari’ah-compliant financing fairly common when U.S. firms are involved?

Direct Shari’ah-compliant financing is not commonly used in the U.K. for LBO transactions, although it is more frequently used in real estate transactions in the U.K. One reason is that U.K. financial-assistance laws prevent a company from using its own assets to finance the purchase of its shares, thus prohibiting this type of financing unless the target is a limited company (as opposed to a PLC), and what is called a “whitewash” is employed.

I wouldn’t say that Shari’ah-compliant LBO financing is common in the U.S. The demand for it is relatively limited and the structures are complicated.

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