Legal Business Blogs

Deal View: Life after Hatchard – does Skadden hunger to take its peerless M&A team to the next level?

‘Theirs is the biggest succession issue faced by any firm in the City,’ says one Magic Circle partner of Skadden, Arps, Slate, Meagher & Flom’s prospects, following the retirement of veteran dealmaker Michael Hatchard (pictured right) at the end of last year.

The widely-admired Hatchard did much to make Skadden a US trailblazer in public M&A work in Europe. Though leveraged finance hogs the headlines these days, Hatchard and Skadden were still the competitive forces most cited by top M&A partners at London rivals. Having moved from Theodore Goddard in 1994, Hatchard (who remains a consultant to Skadden) was one of the most successful transfers ever in City law.

‘Michael is urbane, charming and clever, while being no-nonsense,’ gushes one Herbert Smith Freehills partner. ‘The epitome of an English M&A lawyer – he’s exactly the person you’d want on a pitch.’

Dwelling on the man’s deal highlights in any length would require a longer article, but representative standouts include advising Pfizer on a $69bn bid for AstraZeneca, advising Colfax Corporation on its $2.4bn acquisition of Charter International and the 2015 work on Ball Corporation’s acquisition of Rexam for £4.3bn.

Still, many question why a Wall Street institution with such a strong M&A heritage has not built more on that early progress. Yes, Mergermarket’s UK M&A league tables place Skadden at number three by deal value, having advised on $99bn of transactions over 27 deals in 2017, more than twice the ranked value of 2016. But such benchmarks are volatile and invariably inflate the role of American counsel in substantive European deal work.

The UK figures were bolstered, advising Cincinnati-based Vantiv on its £9bn acquisition of UK-listed payment processor Worldpay, with a team featuring London partners Scott Hopkins and Linda Davies.

You can question – and some do – if Skadden has enough depth to its ten-partner City M&A bench, which includes elder statesman Scott Simpson (pictured left), Lorenzo Corte, Sandro de Bernardini, Hilary Foulkes, Pranav Trivedi, Robert Stirling, Richard Youle and Katja Butler.

De Bernardini was the last internal promotion back in 2016, while the rare lateral hires of White & Case dealmaker Youle along with Butler last year brought in an M&A hand with a genuine following and presence.

The debate about how Youle’s buyout business fits into Skadden’s M&A machine has been much rehearsed, but Skadden is bullish given that Youle helped to secure a key role advising Hg Capital, the lead member of the consortium bidding for Norwegian software firm Visma for €4.64bn.

One M&A partner at a rival points to the 2014 hire of Freshfields Bruckhaus Deringer insurance head Robert Stirling as another significant addition. Stirling was instrumental in sealing a role earlier this year advising UK-listed Phoenix Group on its £3.2bn acquisition of Standard Life Aberdeen’s insurance business.

Simpson, co-head of Skadden’s global transactions practice, comments on life after Hatchard: ‘Michael laid the foundations for us to be the only firm to take on the Magic Circle on UK M&A on a regular basis. Over 20 years he also helped to build out our capabilities in banking, tax, litigation, white-collar crime, regulatory work, funds and employment law. Our strategy remains the same: be the firm of choice in Europe for the most challenging deals.’ And with an M&A tradition as rich as Skadden’s no-one doubts the firm will remain a potent force in the transatlantic deals community.

Yet the glory days of Skadden’s iconoclastic dash under Joseph Flom – when it was the most influential law firm in the corporate legal market – have surely long since passed. And the firm has been wary of expansion since being forced to shed hundreds post-Lehman. Skadden will have to be do more in Europe’s M&A market to be not only respected but once again feared.

See our Life During Law with Skadden’s Richard Youle