Legal Business

Pillsbury and Chadbourne in merger talks as NY’s legal mid-tier continues to consolidate

Pillsbury and Chadbourne in merger talks as NY’s legal mid-tier continues to consolidate

US firms Pillsbury Winthrop Shaw Pittman and Chadbourne & Parke are in early merger talks, with the potential to create a 1,000 lawyer firm.  

San Francisco founded Pillsbury, which sits in the top-75 firms of the Global 100, generated revenues of $560m in 2014, while profit per equity partner (PEP) stood at $1.2m. 

New York-based Chadbourne, on the other hand, has eleven offices worldwide and focuses on cross-border transactions and disputes in emerging and growth markets. The firm’s core practice areas include project finance, energy, litigation, corporate, bankruptcy and financial restructuring, insurance and reinsurance, tax and real estate, and it is particularly known for its work in energy matters across Central and Eastern Europe, Russia, Turkey, the Middle East, Africa, Asia and Latin America.

The merger discussions would not be the first for Pillsbury which in 2013 was in talks with US firm Orrick Herrington & Sutcliffe, which would have created a firm of about 1,800 lawyers with revenues of around $1.4bn, putting it in the top 15 law firms in the world by fee income. The deal was called off in November of that year, after a conflict of interest emerged between clients in Orrick’s public finance practice and Pillsbury’s tax, environmental and real estate practices.

Pillsbury’s lawyer headcount fell in March this year, after 15 lawyers quit to join Winston & Strawn, with the firm’s Abu Dhabi managing partner Stephen Jurgenson, London-based co-head of energy, infrastructure and projects James Simpson and New York-based structured products chief Jeffrey Stern exiting the firm.

If the deal goes through, the combination will see the US’ legal mid-tier consolidate as more firms join hands to keep up pace with the globalisation of law. In late 2014, Morgan Lewis & Bockius acquired Boston-based firm Bingham McCutchen’s assets after the latter firm suffered major losses in mortgage-backed securities and restructuring work.  

jaishree.kalia@legalease.co.uk

Legal Business

Mass hires: Fresh wave of Pillsbury partners join move to Winston & Strawn

Mass hires: Fresh wave of Pillsbury partners join move to Winston & Strawn

Eight more Pillsbury Winthrop Shaw Pittman partners have resigned in New York, Washington DC and San Francisco to join Winston & Strawn, taking the firm’s haul of Pillsbury partners up to 11.

Winston & Strawn, which was revealed by Legal Business yesterday to have been targeting up to 15 lawyers from Pillsbury and having already secured Abu Dhabi managing partner Stephen Jurgenson, London-based co-head of energy, infrastructure and projects James Simpson on top of New York-based structured products chief Jeffrey Stern, has hired senior Pillsbury partners to manage its investment management and M&A and securities practices. 

As part of the firm’s push into the corporate market, Winston & Strawn has brought in Pillsbury Washington DC-based corporate partner Chris Zochowski. He joins as co-chair of the firm’s M&A and securities group. Zochowski joined Pillsbury in 2011 from McDermott Will & Emery, where he had spent four years as a partner. He started his career as an associate at Sullivan & Cromwell.

Joining the influential Stern in New York are two finance partners, restructuring specialists Peter Alfano and Anthony Schouten, alongside corporate partner James Kelly, corporate trust partner Bart Pisella and employment partner Scott Landau.

Landau works closely with the finance team and is well known for representing private equity clients in acquisitions, divestitures and restructurings. The moves bring the number of partners making the switch in New York up to five, with more expected to follow.

‘The addition of this talented group enhances our M&A, private equity, finance and corporate trust practices while augmenting our footprint in key markets,’ said Dominick DeChiara, chair of Winston’s corporate department. ‘These partners will integrate exceptionally well with our existing practice and client base.’

Winston & Strawn’s raid on Pillsbury also hit the West Coast with the arrival of financial services partners Jay Gould and Michael Wu.

Gould headed Pillsbury’s investment funds and investment management practice and takes up a similar position at Winston & Strawn, gaining the title of financial services and investment management co-chair.

Gould’s book of business centres on investment companies, hedge funds, offshore investment companies and broker-dealers. He has served long stints within the financial services sector too, having been chief counsel at US online brokerage platform E*TRADE Global Asset Management, vice president at life insurance firm TransAmerica and senior counsel to Bank of America National Trust and Savings Association. He has been an attorney at the Securities and Exchange Commission.

Wu’s practice focuses on investment management regulation, advising broker dealers, private equity funds and hedge funds.

DeChiara said the duo were ‘important hires’ due to their ‘strong track record of helping clients in the financial services sector to navigate the challenges presented by the continuously changing regulatory environment’.

Outlining Winston & Strawn’s overall aims, managing partner Tom Fitzgerald added: ‘We are placing an emphasis on strategically expanding our corporate practice in key markets, including Houston, London, Los Angeles, New York, Silicon Valley, and Washington DC.’

tom.moore@legalease.co.uk

Legal Business

Mass hires: Pillsbury sees partners start to move to Winston & Strawn across three offices

Mass hires: Pillsbury sees partners start to move to Winston & Strawn across three offices

Up to 15 lawyers are set to quit from US firm Pillsbury Winthrop Shaw Pittman for Winston & Strawn, with the firm’s Abu Dhabi managing partner Stephen Jurgenson, London-based co-head of energy, infrastructure and projects James Simpson and New York-based structured products chief Jeffrey Stern having already resigned from the firm.

An internal announcement to the Winston & Strawn partnership on Monday confirmed that Stern had joined the firm. Legal Business understands the New York structured finance specialist also attended Winston & Strawn’s annual partners meeting in Scottsdale, Arizona, last week. Management at Winston & Strawn was hoping to announce what one partner told Legal Business is ‘up to 15 lawyers, mainly partners, and mostly heads of departments’ at the four-day gathering which ended on Sunday, but was delayed as some Pillsbury partners are still to resign.

The swoop reinvigorates what has been a flagging international strategy at Winston & Strawn following a number of partner exits in 2014 and bolsters the firm’s finance credentials in the US, London and the Middle East. The firm is well known and regarded for its litigation capabilities in the US, with disputes accounting for around 50% of the firm’s global revenue, and this move is viewed by partners as a major push to rebalance the firm and build up in corporate.

Jurgenson’s arrival will result in Winston & Strawn launching in the Middle East, with the firm contemplating whether he continues to operate in Abu Dhabi or relocates to Dubai. The new office will become Winston & Strawn’s 19th global office, but one issue that will need to be resolved is that the firm will need to obtain its own license for him to practice under its banner, as it is necessary for him to be employed to stay in the jurisdiction.

Stern is seen by Winston & Strawn management as a major coup in New York, with two decades of experience in structured finance and derivatives under his belt. He has also moved into the crowdfunding arena, helping to launch a number of financings. He previously spent time as a partner at US firms Stroock & Stroock & Lavan and Thacher Proffitt & Wood.

Meanwhile, Simpson is set to join Winston & Strawn’s London office in April and is expected to bring across a team of associates as well. Simpson works closely with Jurgenson in the Middle East, given his large book of business in the region, and has more than 25 years of corporate transaction experience. He leaves after just three years at Pillsbury, having joined in May 2012 from now defunct Dewey & LeBouf, where he was also a partner.

Commenting on the departures, Pilsbury said in a statement: ‘While Pillsbury has had excellent partner retention in recent years, it is nevertheless a fact of life that partners come and go at all firms. We are very sorry to see any partner leave us. We wish these partners nothing but the best in their new endeavor.’

tom.moore@legalease.co.uk

Legal Business

Merger talks: Orrick and Pillsbury call time on talks after client conflict issues dominate

Merger talks: Orrick and Pillsbury call time on talks after client conflict issues dominate

The potentially game changing merger between California-based Orrick, Herrington & Sutcliffe and New York-headquartered Pillsbury Winthrop Shaw Pittman is off after the firms said issues surrounding client conflicts of interest had proved insurmountable.

The firms disclosed around a month ago that they were in talks, with a view to creating a 1,800-lawyer practice with revenues of around $1.4bn, putting the combined entity in the top 15 law firms in the world by fee income.

The declaration that the firms were in talks was made in the name Orrick Pillsbury and widely interpreted as meaning that a deal could be sealed within weeks. However, in a mutual statement issued in the US yesterday (25 November) the firms clarified that their decision to call off the talks came ‘prior to the execution of a letter of intent or submitting the matter to either partnership for a vote.’

The firms added: ‘We mutually determined that we will not be able to proceed due to prospective client conflicts that we have not been able to resolve, notwithstanding each firm’s best efforts. Our two firms come away from these discussions with enormous respect for each other both institutionally and across our management teams, a mutual respect that has only grown throughout our discussions.’

Orrick chairman Mitch Zuklie commented: ‘Pillsbury has long been known to us as a firm with high calibre legal talent and a client-focused culture much like ours. Large law firm combinations are always complex, and both our firms are disappointed that we could not clear the way for a merger.’

Both firms have previously sought merger partners in recent years without success. Orrick entertained and publicly pulled out of talks with Dewey Ballantine in 2006, a move that saw the New York firm instead merge with LeBoeuf, Lamb, Greene & MacRae, creating the ill-fated Dewey & LeBoeuf. Orrick has also previously held discussions with UK firms Bird & Bird and SJ Berwin.

jaishree.kalia@legalease.co.uk

Legal Business

Those US mergers keep coming – Orrick closes in on deal with Pillsbury to forge top 10 giant

Those US mergers keep coming – Orrick closes in on deal with Pillsbury to forge top 10 giant

One of the most prolific merger suitors of recent years – Orrick Herrington & Sutcliffe – is at it again with the top 30 US practice close to securing a merger with the 600-lawyer practice Pillsbury Winthrop Shaw Pittman.

The discussions, which were confirmed on Friday (25 October), could see Orrick sign a letter of intent as early as this week to recommend a combination with Pillsbury to its partners. A deal would create a 1,800-lawyer practice with revenues of around $1.4bn, putting it in the top 15 law firms in the world by fee income.

Pillsbury chairman James Rishwain and Orrick chairman Mitch Zuklie issued a joint statement to the US media stating: ‘Our firms are in exploratory discussions about a possible combination. These talks are serving to confirm the great respect our firms have for each other.’

The deal would likely be an effective takeover with the San Francisco-based Orrick being the larger of the two and also enjoying a stronger position financially. Orrick generated revenues of $866m in 2012, up 2% annually and a rise of 12% over the last five years. Its profits per equity partner (PEP) were up 10% annually to $1.63m, though the firm’s profitability is flattered by high leverage, with only 124 of its 1,128 lawyers last year holding equity status.

Pillsbury saw revenues up 7% in 2012 to $561m, though its fee income has fallen 5% over the previous five-year period. The firm’s 164 equity partners earned an average of $1.09m in 2012, a relatively low figure for a top 100 US practice.

Both firms have previously sought merger partners in recent years without success. Orrick had entertained and publicly pulled out of talks with Dewey Ballantine in 2006, a move that saw the New York firm instead merge with LeBoeuf Lamb Greene & MacRae, creating the ill-fated Dewey & LeBoeuf.

Orrick has also previously held discussions with UK firms Bird & Bird and in 2010 with SJ Berwin.

A union would create a huge practice on the West Coast of America but arguably leave both firms relatively under-weight in New York and Europe. Neither Orrick or Pillsbury has had sustained success in London, though Orrick has a large Paris practice. Major clients of Orrick include Apple and Oracle, which it has acted for in a patent dispute with Google. Pillsbury’s clients include Chevron and BNY Mellon.

The deal comes amid challenging trading conditions in the US economy, though the legal market has generally out-performed Europe on the back of high levels of disputes and regulatory work. Despite the focus among advisers on major technology clients, California’s wider economy has remained subdued over the last five years in part due to locally-based bluechips and banks focusing their efforts nationally.

The talks come amid a run of recent discussions among major US practices. Aside from the union agreed last year between Fulbright & Jaworski and Norton Rose, Dentons is currently in discussions with McKenna Long. Reuters reported on Sunday (27 October) that Washington DC’s Patton Boggs is in discussions with the Dallas-based Locke Lord.

Whether such deals can improve the fortunes of the combining law firms will remain open to debate as many of these institutions have struggled to sustain momentum in recent years. Orrick is generally regarded to have squandered much of the international profile it had built up a decade ago, while the leadership of Ralph Baxter – who stood down as chief executive in March this year after 23 years at Orrick’s helm – drew increasing criticism in the latter years of his term.

alex.novarese@legalease.co.uk

Legal Business

Wall Street in London: Weil Gotshal and Davis Polk lead on $1.6bn takeover of UK’s Edwards Group

Wall Street in London: Weil Gotshal and Davis Polk lead on $1.6bn takeover of UK’s Edwards Group

As British industrial technology firm Edwards Group is today (19 August) bought out for $1.6bn by Swedish engineering group Atlas Copco, it is notably being advised by the London office of Wall Street firms Weil, Gotshal & Manges and Davis Polk & Wardwell.

The Weil Gotshal team, which represented Edwards Group on its initial public offering on the New York Stock Exchange last May, is being led by London-based corporate partner Peter King, assisted by New York corporate partners David Blittner and Jackie Cohen.The firm has a longstanding relationship with the major shareholders of the company, private equity firms CCMP Capital and Unitas. Peter King told Legal Business: ‘We’re very happy to be acting for Edwards on a deal of this size and importance.’

The Davis Polk team is being led by London-based heavyweight corporate partner Simon Witty, who joined from Freshfields Bruckhaus Deringer in 2012 to launch the firm’s English law capability in London, alongside fellow corporate partner John Banes. Davis Polk represented the underwriters in Edwards’ initial public offering.

Pillsbury Winthrop Shaw Pittman are leading for Atlas Copco with a team led by New York-based corporate partner Stephen Rusmisel.

The deal follows last month’s £3.3bn takeover bid by France’s Schneider Electric for UK engineering firm Invensys, in which Magic Circle firms Linklaters and Freshfields Bruckhaus Deringer advised the respective companies.

david.stevenson@legalease.co.uk