IFLR 1000
The Guide to the World's Leading Financial Law Firms

Kirkland & Ellis has a solid capital markets practice, with particular expertise in reverse-LBO public offerings, where a company that was taken private or acquired in a LBO is selling new stock to the public, and in high-yield debt offerings, with the proceeds used for acquisitions or refinancing of existing debt.

In March 2011, the firm represented General Motors as the selling security holder in its $1 billion offering of 8.5% fixed-rate perpetual preferred stock of Ally Financial.

Other notable work includes representing Clearwire, a provider of wireless broadband services, in the offering of $3.4 billion of high-yield notes and a $380 million secondary offering of subscription rights to purchase common stock. Clearwire plans to use the net proceeds from this offering, in December 2010, for working capital and general corporate purposes.

Kirkland & Ellis is a new entry to the bank lending ranking this year, following favourable feedback from peers. The firm's banking group benefits from the expertise of its top-notch private equity practice, representing private equity investors in both control and non-control investments in financial institutions, and advising some of the largest banks in the United States on capital-qualified debt and equity products. "They have a very strong practice because of their private equity clients," says one rival.

On the regulatory side, the firm recently lost Zach Brez, who joined Ropes & Gray as a partner in October 2010. In November 2010, partner Gregory Bauer joined the firm's banking practice from Jones Day.

Kirkland & Ellis is involved in the ongoing representation of Ally Bank in its secured credit facility. A recent transaction created a $7 billion revolving credit warehouse facility through three issuers, each issuing notes secured by financial assets of a particular motor vehicle asset class. The facility included an interest rate hedging capacity. The unusually-structured transaction is one of the largest currently outstanding motor vehicle related securitisations sponsored by a bank that does not need to rely on either the FDIC Safe Harbor to protect investors from the sponsoring bank's insolvency risks.

In one of the few non-assisted acquisitions announced in the banking industry during 2010, the firm also represented BankFinancial in its purchase of Downers Grove National Bank.

Kirkland & Ellis continues to build on the success of its M&A practice, which is boosted by its reputation as a go-to shop in private equity. The firm's clients include Fortune 500 companies and more than 250 private equity firms, and one competitor describes it as "a bit of an up-and-comer".

Kirkland & Ellis recently boosted its M&A group with the addition of partner Michael Kim in June 2010, and Alexander Fine, former executive vice president & corporate counsel for Allied Capital Corporation, in October 2010. A client of the firm describes its lawyers as "very easy to get in touch with", and "very easy to talk to, down to earth, honest, and trustworthy."

In a deal announced in April 2011, the firm is representing long-time client Constellation Energy Group in relation to a planned merger with Exelon in a stock-for-stock transaction. Constellation shareholders will receive approximately $7.9 billion in total equity, which values Constellation at over $11 billion. The resulting company will be worth $52 billion and will retain the Exelon name.

In another ongoing transaction, Kirkland & Ellis is advising Teva Pharmaceutical Industries, the world's largest generic drugmaker, in its agreement to acquire Cephalon for $6.8 billion. Valeant Pharmaceuticals International had made several hostile offers to acquire Cephalon, which were all rejected by the Cephalon board. Following Cephalon's announcement of its agreement with Teva, Valeant said it would end its effort to buy Cephalon. The deal is expected to be completed in the third quarter of 2011.

With "a very deep client base in the middle market" and "a large number of lawyers who are very good in the practice", peers agree that Kirkland & Ellis is a frontrunner in deal volume. Private equity is integral to the firm, with around 60% of its 600 corporate lawyers regularly advising private equity sponsors. Its attorneys, who serve over 250 private equity firms, are known for pioneering structures and techniques.

"We view Kirkland as the model for the middle market because they represent a slew of middle market firms, and I don't think anybody else does that well," says one competitor. "They are very deep and they know all the arguments. There's nothing out there that they haven't thought of."

Peers identify Kirk Radke as one of the firm's stars, noting that he is "at the top of their pole". "They are great people and are incredibly responsive," says one client. "They really provide a first-rate service." The client singles out "exceptional" partner Sanford Perl for praise. "He's an incredibly good lawyer, a great advisor," he says.

Kirkland partners Stephen Fraidin and Bill Sorabell received widespread media attention for an innovative 'dual track' acquisition structure in 3G Capital's $4 billion going-private acquisition of Burger King. This involved 3G beginning a tender offer to acquire control of Burger King, while the fast food giant filed a proxy statement and held a meeting to approve the acquisition. Burger King would be acquired through whichever method was completed first. The agreement for the transaction, which closed in October 2010, also contained mechanics to address potential financing failures.

In an ongoing deal, the firm is representing Apax Partners in the combined $2 billion acquisition of software companies Epicor Software and Activant Solutions to form a single new company. It is unusual for a going-private transaction to include a condition that the acquisition of a separate private company occurs simultaneously.

With over two decades of representing the management companies of sponsors, private equity is a key practice area of Kirkland & Ellis. Around 60% of the firm's 600 corporate lawyers regularly work with private equity sponsors. Since 1995, it has represented over 280 sponsors in raising over $350 billion of capital for more than 536 funds. One competitor says, "K&E is very established in this space."

The firm regularly represents leading institutional investors in connection with their investments in private funds. At the IFLR Americas Awards 2011, which celebrate innovation, Kirkland & Ellis was named Private Equity Team of the Year.

Peers credit long-time partner Jack Levin, who has handled fund formation matters for big-name clients including Madison Dearborn Partners, First Chicago, and Bank of America, with helping to build the firm's first-rate practice. Levin, together with other Kirkland lawyers, has written two widely-read treatises on private equity. "They probably came to the private equity fund formation earlier than others because of Jack Levin," says one competitor. "They clearly have a significant private equity practice."

With what peers describe as a "top-notch" practice and a "substantial group of very talented people", Kirkland & Ellis distinguishes itself as one of the leaders of the pack. The firm handles some of the largest and most complex insolvency matters domestically and abroad, and has earned an international reputation for achieving results.

In March 2011, the firm was named the Restructuring Team of the Year at the IFLR Americas Awards 2011, which recognise the most innovative cross-border transactions. "I think Kirkland & Ellis probably has the lion's share of debtor cases by a fair margin, and if anything they are on the ascendancy," notes one competitor. Another rival remarks, "You have them as number one for a reason - I think they are the best at this."

Partner James Sprayregen, who returned to the firm in 2008 after leaving to work at Goldman Sachs for several years, is widely recognised as one of the top lawyers in the industry. "K&E is a machine, and that's even more true since Jamie Sprayregen went back to Chicago," says a third peer. One client, who has worked with a team led by partner David Eaton, says, "They were very up on all the options in bankruptcy and what needed to take place. Particularly in the beginning, when we didn't know anything about it, they were very good at laying out options and providing different alternatives."

The firm represented chemical company Chemtura in a $3.1 billion Chapter 11 reorganisation, completed in November 2010. Chemtura restructured its 4000-employee business, resolved billions of dollars in environmental and mass tort claims, and emerged with a plan to fully pay all creditors, including $1.5 billion in funded debt. The plan was confirmed after a four-day trial, in which the company successfully defended its calculation of enterprise value, and a series of complex settlements underlying the plan.

Other notable work includes advising shopping mall operator General Growth Properties on restructuring $29.6 billion in total assets and $27.3 billion in total liabilities. All creditors will receive a 100% recovery of their claims against the debtors, and equity interests were reinstated under the plan. The transaction was completed in November 2010.