Mergers and Acquisitions

Wall St Wall Street investment banking finance financial.jpgIn case you hadn’t heard, Wall Street is in meltdown mode right now. Our colleagues over at Dealbreaker have been working over the weekend and around the clock to cover all the latest developments.
Here are the two big stories from the financial world. First, the top-level parent company of Lehman Brothers, Lehman Brothers Holdings Inc., is filing for Chapter 11 bankruptcy protection. (But no sleeping in for Lehmanites; they have been informed that they’re still expected to show up to work this morning.)
Second, Merrill Lynch, the investment bank that some feared might be next to go down the Bear Stearns / Lehman Brothers path, has reached a deal to sell itself to Bank of America, for $50 billion.
What do these deals mean for lawyers? Well, at least in the short term, they bring good news: more work. (Over the long term, of course, the news may be less good, as current and potential future clients vanish from the landscape on Wall Street.)
For its bankruptcy, Lehman is turning to Weil Gotshal & Manges, long known for its top-notch bankruptcy practice. From Dealbook:

Weil.gifLehman has hired Weil, Gotshal & Manges, the law firm that handled Drexel [Burnham Lambert]‘s bankruptcy filing [in 1990]. Harvey Miller, the head of Weil’s restructuring practice, is known as one of the deans of the bankruptcy bar.

In addition, Lehman is trying to sell its more valuable assets, including its broker-dealer and asset-management operations. It appears to be represented in those efforts by Sullivan & Cromwell, according to TheDeal.com (subscription).
Wachtell Lipton Rosen Katz WLRK AboveTheLaw Above the Law blog.jpgMeanwhile, Wachtell, Lipton, Rosen & Katz, a powerhouse in financial-institutions M&A, is getting a piece of the action on the Merrill deal. As reported by the Wall Street Journal, the Merrill / B of A deal was hammered out in “a marathon series of meetings at Wachtell, Lipton, Rosen & Katz, the law firm which has long represented Bank of America in its deals.”
Shearman & Sterling logo Above the Law blog.jpgWachtell isn’t lending out their offices for free. As TheDeal.com reports, WLRK is indeed representing Bank of America in the transaction (for a fee that will be well into the eight figures — Ed Herlihy doesn’t come cheap). Merrill Lynch is being advised by Shearman & Sterling.
If you’re aware of other winners and losers from these deals, please share what you know, in the comments.
Lehman Announces Bankruptcy Filing For Holding Company [Dealbreaker]
Bank of America Reaches Deal To Buy Merrill Lynch [Dealbreaker]
What a Lehman Bankruptcy Filing Might Look Like [DealBook]
Bank of America to Buy Merrill [Wall Street Journal]

As we can see from the comments, you’re already all over this NYT story. We linked to it in Morning Docket, but here’s a little more. Andrew Ross Sorkin writes:

Wachtell Lipton Rosen Katz WLRK AboveTheLaw Above the Law blog.jpgJPMorgan and Bear were prompted to renegotiate after shareholders began threatening to block the deal and it emerged that several “mistakes” were included in the original, hastily written contract, according to people involved in the talks.

One sentence was “inadvertently included,” according to a person briefed on the talks, which requires JPMorgan to guarantee Bear’s trades even if shareholders voted down the deal. That provision could allow Bear’s shareholders to seek a higher bid while still forcing JPMorgan to honor its guarantee, these people said.

When the error was discovered, James Dimon, JPMorgan’s chief executive, who was described by one participant as “apoplectic,” began calling his lawyers at Wachtell, Lipton, Rosen & Katz to seek a way to have the sentence modified, these people said. Finger pointing over the mistakes in the contracts began as bankers blamed the lawyers and vice versa.

We don’t have much to add to Ted Frank’s excellent observations. Here’s an open thread for anti-Wachtell schadenfreude.
(They’re big boys — and they send their clients big bills. So the WLRK folks can take a little snark and ribbing from the ATL commentariat.)
Update (11:40 AM): Actually, did Wachtell make a mistake? If so, what exactly was their error? Over at Dealbreaker, our colleague John Carney wonders: “How do you ‘inadvertently include’ a provision everyone is talking about?” (Gavel bang: commenter.)
How Do You Inadvertently Include A Provision Everyone Is Talking About? [Dealbreaker]
The dangers of doing an M&A agreement over a weekend [Overlawyered]
Did Mistakes in the JPM-Bear Contract Help Lead to Renegotiation? [WSJ Law Blog]
JPMorgan in Negotiations to Raise Bear Stearns Bid [New York Times]

* New accounting rules for M&A. [DealBook]
* Lilly contemplates $1 billion payment to settle civil and criminal investigations relating to its marketing of Zyprexa. [New York Times]
* NYPD officer accused of pimping child. [MSNBC]
* Ex-priest jailed for murder via exorcism. [CNN]
* Indiana man arrested for making his own crosswalk. [The Indy Channel]
* Nader takes steps toward another run for the presidency in 2008. [Bloomberg]

The combined firm will have over 1,500 lawyers in 23 offices. It will “employ the K&L Gates brand and have the legal name of Kirkpatrick & Lockhart Preston Gates Ellis LLP.” Press release here.
Update: Some commentary from an inside source, after the jump.
K&L Gates, Hughes & Luce Partners Vote to Combine Firms Effective January 1 [K&L Gates]

double red triangle arrows Continue reading “Law Firm Merger Mania: K&L Gates + Hughes & Luce”

Here is the latest Job of the Week, courtesy of ATL’s career partner, Lateral Link. To refresh your recollection:

“Because Lateral Link does no cold-calling and is more efficient than traditional recruiting firms, successful candidates receive $10,000 upon placement.”

Position: M&A Associate (Media)
Description: This highly sought after media and advertising law firm is seeking a mid-level associate with a strong M&A background to work on media and advertising-related deals. Work primarily involves private transactions, but will have the occasional public transaction.
Founded over hundred years ago, this firm is renowned as the top marketing communications law firm in the world, representing four of the largest advertising agency holding companies. The firm is remarkable in the fact that it maintains worldwide leadership in a key field of law with only 100 attorneys, based in a single office in New York City. Having grown from less than 40 attorneys in the 1990s, the firm serves clients in a full range of practice areas, including corporate governance, litigation, M&A, employment practices and executive benefits and compensation, intellectual property, new media, real estate, taxation and estate planning. The firm also enjoys a sterling reputation among not only its major advertising and marketing communications clients, but among its attorneys as well. The firm has a one-to-one partner to associate ratio and is regarded as an unusually rewarding, reinforcing and humane place to work.
Position Requirements: Four to six years of experience. M&A background, top credentials, good personality.
To apply for this position, or to learn about other career opportunities, please visit laterallink.com.
Earlier: Prior Job of the Week listings (scroll down)

Facebook Dealbook Special Section Fall 2007 Above the Law blog.jpgThe excellent DealBook Special Section, in today’s New York Times, has a piece by Andrew Ross Sorkin that the New York deal lawyers among you will love. It’s entitled The Facebook of Wall Street’s Future:

Here is a snapshot of more than 100 people who make up the next generation of deal makers, everyone 40 years old or younger and linked by where they went to college (and chosen based on dozens of interviews). Think of the list as a Facebook of Wall Street’s future.

This is not an exhaustive inventory of all the up-and-comers on Wall Street, where new faces constantly come up with the next clever idea. But it demonstrates the power of certain schools as career starting points.

In terms of law schools — there are lots of business schools on the chart, too — the “certain schools” include Harvard, NYU, Georgetown, and Penn (among others; these four seem to have the most graduates on the map — 6, 6, 4, and 4, respectively).
Correction: Oops, sorry (and thanks to this commenter for pointing out our error). Columbia Law School has 7 featured alums. CLS, holla!
It’s tough to escape “tier-ism,” even when you move from the heart of the legal world to the point where it overlaps with the deal world. But do take note of the large area at the center of the illustration for people with “No Graduate Degrees.”
Some of the names on the map will be familiar to ATL readers. A few shout-outs, after the jump.

double red triangle arrows Continue reading “Attention Young Legal Deal Makers: Did You Make the Cut?”

DealBook special section merger lawyers AboveTheLaw Above the Law blog.jpgAs some of you have noticed, we have an article in today’s New York Times, in the DealBook Special Section. It’s about fee arrangements in the (highly lucrative) context of mergers-and-acquisitions work. Here’s a teaser:

For some firms, billable hours are just the beginning. As the boom rolled on, law firms specializing in mergers and acquisitions increasingly engaged in premium billing, charging fees in excess of their total hourly billings. Think of it as a tip for good work. Whether a client pays a premium depends upon its satisfaction with the result, the size and complexity of the transaction, and the nature and length of the attorney-client relationship.

But since the credit market began to tighten this summer, an event that brought new deals to a crawl and has upset several old ones, many lawyers have been wondering whether the premium party is over…

And here’s one of the more juicy portions:

One firm, though, has moved beyond billable hours to the flat fee preferred by bankers: Wachtell, Lipton. A former Wachtell lawyer described a typical bill as follows: “There’s a paragraph stating something like, ‘For legal services rendered in connection with Transaction X,’ then a dot leader, then a number followed by six zeros.” He said he worked on some deals where Wachtell was paid more than the bankers.

Wachtell charged a flat fee when it advised the Bancroft family, which controlled Dow Jones & Company, during the $5 billion bid by Rupert Murdoch’s News Corporation For its work on the deal, Wachtell first submitted a bill for $10 million.

You can read the full piece here (or here). Feel free to email it liberally to friends and family. Thanks!
When $1,000 an Hour Is Not Enough [Dealbook / NYT]

Martin Lipton Marty Lipton Wachtell Lipton WLRK Above the Law blog.jpgWe should have written about this earlier — in fact, weeks earlier, since it has been up since early August. But sometimes things fall through the cracks, emails get caught in our spam filter, etc. Anyway, better late than never.
From a helpful reader:

check out this blog. it’s sort of a one trick pony, but its good for a laugh and is pretty out there. as a wlrk alum, figured you would get a kick out of it. thanks.

We agree — it’s funny and bizarre. From the inaugural post of The Poison Pill:

This blog is devoted to our hero and idol, corporate law phenom Martin Lipton. Mr. Lipton, name partner in the prestigious and venerable firm Wachtell Lipton Rosen & Katz, has been practicing law since the mid-1960′s after he graduated from NYU law school, and is considered by most in the industry to be the “dean” of the M&A bar. This legendary advocate is most famous in legal circles for inventing the “poison pill,” a takeover defense now used by virtually all public companies to delay and deter hostile tender offers and other solicited acquisitions.

That’s right, you heard me–not only is Mr. Lipton a skilled and accomplished lawyer, he is an inventor as well. We also hear that he is a marvelous ballroom dancer, but have yet to receive confirmation on this point.

You can read the rest of the post over here.
Could this blog turn into the Biglaw equivalent of the Fake Steve Jobs blog, which developed into a sensation of the business world? Stay tuned.
The Poison Pill

White Case LLP Above the Law blog.JPGHere’s some law firm merger scuttlebutt that’s making the rounds:

Rumor is that White & Case is acquiring Moore & Van Allen, a native Charlotte firm with a national syndicated finance practice. Any truth to this?

We reached out to both firms for comment. A White & Case spokesperson issued this statement:

“We do not respond to inquiries of this kind.”

Should we take that as a “yes”?
If we hear back from Moore & Van Allen, we’ll let you know. If you have any info, please email us. Thanks.

People in the offices of both Dewey Ballantine and LeBoeuf Lamb have been gossiping about a possible merger between their firms.
Here’s some circumstantial evidence in support of the rumors. If you go to Whois.Net and enter the domain name DeweyLeBoeuf.com, you get this info:
Dewey Ballantine 2  LeBoeuf Lamb Greene MacRae Above the Law blog.jpg
We have a call and an email in to Michael Groll. We’ll let you know if and when we hear back from him.
Update: Might this be a practical joke, as one commenter suggests? Quite possibly. That’s why we’ve reached out to Mr. Groll for comment.
Further Update (4:45 PM): No, this is the real deal. About an hour after our post went up, the WSJ Law Blog chimed in with this write-up: “LeBoeuf Lamb and Dewey Ballantine are in merger talks, with an announcement of a deal expected as early as Monday, according to people familiar with the situation.”
Further Further Update (8/25/07): The New York Times has an article on the merger talks here.
More discussion, plus links, after the jump.

double red triangle arrows Continue reading “Law Firm Merger Mania: Dewey LeBoeuf? (You Heard It Here First)”

Page 8 of 101...45678910