Bingham McCutchen has found a way to expand during the recession. Just weeks after losing 11 lawyers (5 partners and 6 associates) to Morgan Lewis, Bingham McCutchen has acquired McKee Nelson. The American Lawyer reports:
After enduring a rough few years caused by the collapse of the structured finance market, the elite specialty firm of McKee Nelson has agreed to be acquired by the larger Bingham McCutchen.
Partners at both firms were informed Monday morning of the merger, which is scheduled to take effect August 1. The combined firm will be called Bingham McCutchen, and will include all of McKee Nelson’s lawyers.
No word on whether the McKee attorneys have the CHARACTER to become Bingham attorneys. But the merger looks good on paper:
McKee Nelson, which is known as one of the pre-eminent firms for tax planning and tax litigation, was viewed by Bingham as an attractive addition. “It’s really rare to find a firm that is this size that has three market-leading practices,” says Bingham chairman Jay Zimmerman, referring to McKee’s expertise in tax, financial institution litigation, and capital markets-structured finance. Structured finance might be moribund now, but Zimmerman sees it as an area worth investing in. “It will be part of our longterm strategy for serving the financial institution industry.”
How does this work on the McKee side of the ledger? We check in after the jump.
McKee has been shedding people, but firm management says that the firm wasn’t desperate to find a merger partner:
Reed Auerbach, a co-chief executive partner of McKee Nelson, says his firm wasn’t under pressure to find a merger partner. “We had already done the hard work to size the [structured finance] practice appropriately,” he explains. At its peak in 2006, Auerbach notes, the group had more than 120 lawyers; today that number is about a quarter of that with roughly 30 attorneys. (Twenty-three lawyers were laid off, 30 joined Ashurst in February, 26 departed under a voluntary program, and 9 moved to other practice areas.) McKee is not carrying excessive debt, Auerbach says, noting that it owes less than $10 million to banks.
Certainly, slimmer is better if you are looking to merge. And it appears that McKee had already done the heavy lifting of firing its structured finance attorneys in response to the near-death experience of the structured finance market.
But this merger feels a lot more like an acquisition. Bingham McCutchen will still be the name of the firm, and only a few McKee partners will hold leadership positions at their new firm:
McKee Nelson’s leaders will hold some positions of power at the combined firm, but Bingham’s management will clearly be in charge. Auerbach will be the only partner from the smaller firm to sit on Bingham’s 12-person management committee. Nelson and McKee will co-head the tax group, Jeffrey Smith will run the financial institutions litigation group, and Auerbach will manage the capital markets group.
Good luck to Bingham McCutchen and former McKee Nelson attorneys.
Bingham McCutchen Acquires McKee Nelson [American Lawyer]
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