M&A Upswing Creating More Work for BigLaw

Mergermarket, which tracks deals, has reported that, for the 1st and 2nd quarters of 2011, $1.185 trillion in mergers were orchestrated throughout the globe. During the first half of the year, all of this activity was behind the 30% increase in M&A deals over the same period last year.  And large law firms were reaping the benefits.

The busiest law firm was Latham & Watkins. The firm was called in to advise on 138 deals.  With thirty-one locales throughout the world, L&W’s International Arbitration Team was recently named (by The American Lawyer) as one of the most active practices in the world.

Another firm brought in even more in terms of capital, topping well over $200 billion.  Sullivan & Cromwell, with its twelve offices in eight regions, has “shot to the top”, according to The Washington Post’s “Capital Business”.  They counseled clients on two of the most lucrative and most all-encompassing deals.

What were some of these deals?  The two Sullivan & Cromwell advised on were  AT&T’s takeover of T-Mobile from Deutsche Telekom for $39 Billion and Johnson & Johnson’s successful bid of $21 Billion on Swiss medical-device manufacturer Synthes.   When Mergermarket tracked where this placed the firm, in comparison to the previous year’s activity for the same time frame, they came up with a whopping 45% increase in their M&A work.

So what, if anything, can be pointed to as the overriding reason for the remarkable acquisitions and outlay of capital?

“Many corporates have restructured themselves during the downturn and are now realigning themselves and making strategic acquisitions,” said Alberto Luzarraga, head of the corporate practice at Linklaters, which ranked fourth in deal value”, we read in the Post.    Even more invigorating to read might be Luzarraga’s statement that: “It was almost like someone flipped a switch and suddenly everyone got very busy. We’ve been running strongly in New York and across the globe since last June.”

A sense of thumbs-up positivity and optimism does seem to have gripped the arena.  Some up-and-down activity is to be expected, however,  when this sense of optimism wavers from week to week, as industry watchers say that it does.

Another medical company stands to be taken over: Kinetic Concepts, a “medical therapy” firm has caught the eye of Apax Partners, who are represented by Simpson Thacher & Bartlett.  They’re offering $6.3 billion.

In order of revenue allotment, the industries that have seen the most M&A activity are: energy, mining and utilities; industrials and chemicals; financial; pharma, medical and biotech, and consumer.  Go to the Washington Post piece to learn the exact amounts involved.



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