Mergers and Acquisitions

10 Things To Know About Corporate M&A Practice

Almost universally, the long and unpredictable hours are what attorneys dislike most about this practice area.

By Ana Guzman  
on

Ed. note: Welcome to the latest installment of Better Know A Practice Area, a series introducing readers to different practice areas. Each post is written by an editor at Practical Law who previously practiced in that area and currently writes about it. Prior columns have covered capital markets and corporate governance, securities litigation and enforcement, patent litigation, executive compensation, commercial transactions, labor and employment, real estate, startup law, bankruptcy, antitrust, being an in-house generalist, employee benefits law, entertainment law, tax, working overseas, consumer financial regulatory practice, and federal clerkships.

Today’s topic: corporate M&A practice.

  1. What do you do in a typical day?

For a corporate M&A (mergers & acquisitions) lawyer, a typical day includes some combination of working with documents and speaking to clients or colleagues. The day varies largely depending upon the stage of the particular deals being worked on, since a corporate lawyer is often staffed on more than one transaction at a time. Early in an acquisition transaction, buyer’s counsel is immersed in conducting due diligence and preparing initial drafts of the necessary documents. Between various calls and meetings, documents will then be revised and negotiated to address issues discovered in due diligence and reflect the evolving business deal among the parties. As the closing of a deal approaches, attorneys will spend time finalizing agreements, ensuring that closing conditions are satisfied, and obtaining signatures to documents.

  1. Who do you work with?

In private practice, the lead corporate attorney is typically a senior partner, who manages the workflow of the M&A deal by assembling a team. The associates and junior partners on the team often work with various groups: the client, including the business people on the deal team and in-house counsel, and other professionals advising on a transaction, like bankers and accountants.

Corporate M&A attorneys also work closely with other lawyers within their firm specializing in areas of law relevant to the specific transaction. Oftentimes, this includes attorneys with tax, real estate, environmental, employment, intellectual property, finance and antitrust expertise. In multi-jurisdictional or cross-border M&A transactions, corporate lawyers will engage local or foreign counsel to make sure the deal is consummated in compliance with applicable laws.

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To negotiate documents and close the deal, the corporate team members will have substantial interaction with counsel for each other party involved in the deal. Very often, third-party consents or regulatory approvals are also required to complete a transaction, in which case counsel will need to negotiate with the third-parties’ lawyers or regulators to obtain them.

  1. What does a common career path look like?

Within a law firm, a corporate M&A attorney has the same traditional career progression as attorneys in other specialties: junior associate, midlevel, senior associate and partner. Because the prospect of making partner can be uncertain, and some lawyers do not aspire to become partners, more attorneys are taking advantage of the alternate career paths offered by many large firms. For example, senior associates with knowledge in a certain area of law may seek out counsel or special counsel roles to acknowledge their expertise while avoiding the considerable business development obligations associated with staying on the partner track. Other attorneys may choose to work part-time or move into other non-partner-track positions, such as career associates or practice attorneys, which typically come with shorter work hours and lower compensation.

  1. If variety is the spice of life, how spicy is this practice area?

Even when corporate M&A lawyers work on the same types of transactions throughout their careers, there are always nuances that arise from deal to deal. For instance, acquisitions using the same deal structure will vary in complexity depending upon the industry, the size and bargaining power of the parties, and whether the transaction is a strategic one between competitors or by a financial sponsor. Working on a merger of two nationally known companies is vastly different than representing a party in a merger between two small, regional companies, or an acquisition by a private equity fund.

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  1. How much wear and tear?

Corporate M&A practice is demanding and fast-paced. Ultimately, the burnout an attorney experiences depends upon various factors: the typical staffing on transactions, the complexity of the deals, timing for getting them closed and the clients’ expectations.

Lawyers that regularly work on complex transactions that are understaffed and subject to aggressive timelines for demanding clients are likely to endure considerable stress. When experienced attorneys are able to influence these elements, by managing client expectations regarding desired closing dates, or obtaining adequate staffing for a deal on a short timeframe, they can minimize the pressure and weariness felt by their team.

  1. Of the people in this practice group who hate it, what exactly do they hate about it?

Almost universally, the long and unpredictable hours are what attorneys dislike most about the practice. Practically every corporate M&A lawyer will have an anecdote about breaking plans with family or friends due to work.

At certain stages of a deal, like the period right before a closing, the hours can be unforgiving as attorneys concentrate on addressing open issues and last-minute hiccups to complete the transaction. When a deal is set to close by a certain date, there is little leeway to wrap up work at a decent hour and put off pending items until the following day.

  1. Of the people in this practice group who love it, what exactly do they love about it?

Attorneys love the challenge of taking the outlines of an M&A deal described in a term sheet and bringing it to fruition. When negotiating a transaction, seemingly insurmountable issues inevitably arise — whether legal, business or logistical. Corporate lawyers can feel a great sense of accomplishment in resolving these points for their clients and getting the deal done. For corporate attorneys with high-profile clients, they also enjoy being part of transactions that others read about in the news.

  1. Are there common avenues out of this practice area?

One of the most organic career paths for a corporate M&A lawyer is to join or lead an organization’s in-house legal department. Attorneys with corporate experience commonly even move away from legal practice altogether and move into a business role at a company or firm.

Corporate lawyers with significant experience representing publicly traded companies or regulated businesses may work for a government agency like the Securities and Exchange Commission (SEC) or a self-regulatory organization like the Financial Industry Regulatory Authority (FINRA).

  1. What are some market trends that impact this practice area?

Market trends that impact the economy and liquidity can have a strong influence on M&A deal activity. When the economy is strong and predicted to remain so for the future, there are more acquisitions. Clients that typically borrow money to fund deals will be most active in a robust credit market where acquisition financing is available at attractive interest rates. Public companies that use their own stock in purchase offers are more likely to make acquisitions when stable equity markets allow them to present compelling bids.

The political and regulatory climate can also affect deal flow. For instance, when antitrust scrutiny is high, companies that compete in the same market are less likely to pursue transactions with one other. If the current administration has a plan to enact or repeal regulations or change the tax structure, this may cause deal activity to increase or decrease depending upon whether individual companies perceive the impending action as good or bad for their particular business or industry.

  1. If you had to recommend one candidate from a room crowded with recent bar exam graduates, what specific qualities would he or she have that would ensure success in this practice area?

Since drafting and negotiating documents are integral parts of corporate M&A practice, the ability to write well and express positions persuasively are two fundamental skills for corporate lawyers. Willingness to learn about diverse industries and how they operate is important because corporate lawyers do not always specialize in representing clients, or doing deals, in a specific industry. Corporate attorneys should also have an aptitude for project management as closing deals efficiently requires managing the workflow of transactions and the different groups of people involved.

The hallmark of the most successful corporate lawyers, however, is the capacity to understand their clients’ business needs and goals for each transaction.

Ana Guzman is a senior legal editor on Practical Law’s Corporate and M&A team. She focuses on corporate transactions. Prior to joining Practical Law, she was a senior attorney with Greenberg Traurig, LLP and a senior associate with Schulte Roth & Zabel LLP.

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