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

After a tough period following the economic crisis, business is booming for M&A lawyers. According to a report by deal-tracking firm Dealogic, global M&A activity hit $1.5 trillion in the first half of 2011 - up by 22% compared to 2010 levels. "After the financial crisis, non-assisted M&A essentially came to a halt," says one attorney. "There was a period of over a year where there was no M&A other than distressed activity." However, what some in the industry refer to as "the dark days" are now just a bleak memory. "There's optimism and a lot of activity," says another lawyer. "There's a lot of available liquidity, which is a major driver of the M&A market."

The widespread availability of cash, helped by corporate downsizing during the downturn, has resulted in higher asking prices. According to research by Standard & Poor's, the top 50 publicly-traded companies were collectively sitting on over $1 trillion by January 2011. Low interest rates have created additional competition from private equity firms, which can borrow cheaply to finance speculative investments. "Sellers have an inflated idea of what their company is worth, and buyers don't want to pay it," says one lawyer. Another remarks, "It's a matter of waiting out some of the sellers and that's what people are doing."

Relatively high corporate profits have been another factor driving prices. "There's the sense that the proceeds of a lot of companies are high considering the recession, so there's a lot of restructuring to the pricing models that are out there," says one attorney. With good deals difficult to find, yesterday's underdogs of real estate and technology are now prime targets for bargain-hunters. However, activity was spread across a variety of sectors, which M&A lawyers interpret as a good sign.

Several firms report that deals are taking longer to complete. Some buyers are utilising a combination of cash and stock, and transactions are increasingly cross-border propositions. "That adds a whole new element," says one partner. "You can't move as quickly because a tender offer isn't as practical. Also, so many transactions are multi-national - you end up with questions of where are the shares going to trade, are they going to trade in the US, what knowledge of liquidity are they going to provide?" The Americas was the top target for M&A during the first half of 2011. While European activity was still high, optimism was dampened somewhat by the debt problems of countries such as Greece, Portugal, and Ireland. In Asia, China was the biggest focus of M&A activity.

Lawyers see market volatility as the biggest obstacle to doing deals over the coming year. Upheavals such as the nuclear crisis in Japan and uprisings in the Middle East have rocked the markets, and with roadblocks such as the US budget deficit and European debt ahead, attorneys report an increased focus on due diligence. Additionally, the provisions of Dodd-Frank and other regulatory measures have focused many clients on getting their own houses in order. "A number of buyers are pretty occupied with improving their own situation, either by improving compliance or increasing capital levels or improving their own business," says one partner. The increased scrutiny of the financial markets may also have effects in terms of the types of deals that can get done. "Generally speaking, I think anti-trust enforcement will be much tougher than it has been in the Bush years," says another partner.

Cravath Swaine & Moore has worked on some of the most complex deals to come out of the financial crisis, and has been a pioneer of innovations in hostile transactions. Within a two-week period in September 2010, the firm won three proxy contests on behalf of three separate clients. Competitors say Cravath has "a respectable practice" with "an enormously talented bunch of lawyers".

In June 2010, long-time partner Ronald Cami left the firm to work as a general counsel at private equity firm TPG. His departure was followed by those of prominent partners Gregory Shaw, who retired in December that year, and James Woolery, who joined JPMorgan's investment banking group in February 2011.

However, Cravath retains plenty of star lawyers, according to clients. "They are very qualified, they are very experienced, they are very knowledgeable," says one customer. "They are very intelligent, they give practical advice." Another client remarks, "I have worked with all the best firms and without any exception I think they are absolutely unparalleled. They are super-smart, they are very approachable, and they are responsive beyond belief."

In one of the largest negotiated minority squeeze-out transactions, the firm is representing Alcon in connection with a definitive agreement to merge the company into Novartis. As a condition of the $12.9 billion transaction, Novartis will pay $168 per share for the Alcon shares it does not currently own, through a combination of Novartis shares and cash if necessary. The merger will be governed by Swiss law, and is expected to be completed during the first half of 2011.

Cravath also represented Millipore during its $7.2 billion acquisition by Merck. The deal, which closed in July 2010, utilised a plan of share exchange structure, which had not previously been used in Massachusetts in connection with a public company transaction.

Davis Polk & Wardwell continues to live up to its reputation as one of the country's most cutting-edge M&A practices. At the IFLR Americas Awards 2010, which recognise innovation, the firm's M&A group scooped prizes including M&A Deal of the Year and M&A Team of the Year. "Davis is a very able small M&A shop," says one competitor. "I like them - they are capable. They have good people." Another rival remarks, "I think they are focused, experienced and practical."

Clients appreciate the firm's technical expertise and professionalism. "They know the law inside and out and they also help me make important judgements," says one customer. "They give you very high-level, sophisticated advice that helps you make important decisions." Another client says the firm's advice is "timely, it's very high quality and I think they treat us as an important client, so we get very good service from them."

Recent highlights of the firm's work include advising PepsiCo on its $3.8 billion acquisition of a 66% stake in Wimm-Bill-Dann Foods, a food and beverage company. Davis Polk is now advising PepsiCo on an offer for all outstanding ordinary shares and American Depositary Shares of Wimm-Bill-Dann Foods that it does not already own. The tender offer was announced in February 2011, on the same day as the acquisition closed.

The firm is also advising CVSCaremark on its $1.25 billion acquisition of the Medicare Part D business of Universal American, New York-based Medicare prescription drug plan sponsor. The ongoing deal was announced in December 2010.

Simpson Thacher & Bartlett's M&A practice draws strength from the firm's dominance in private equity, according to competitors. "Simpson has two of the largest private equity firms on the planet - KKR and Blackstone," says one peer. "That's what drives their volume."

The group has had several personnel changes over the last year. In September 2010, partner John Finley left the Firm to become senior managing director and chief legal officer of Blackstone. In January 2011, corporate attorney Elizabeth Cooper, whose practice focuses on M&A, was promoted to partner. In April 2011, Stacie McGinn, who advises on regulatory matters including those related to M&A, joined the firm. McGinn was previously the deputy general counsel at Bank of America.

Peers describe long-time partner Casey Cogut as "one of the top lawyers" in M&A. A client says, "They are experienced and knowledgeable, and they are very nice people."

Partners Lee Meyerson and Ellen Patterson led a Simpson team working on TD Bank Financial Group's $6.3 billion acquisition of Chrysler Financial. Following the transaction, which closed in April 2011, TD expects to be positioned as a top five bank-owned auto lender in North America.

The firm also represented energy company PPL Corporation in its $7.6 billion acquisition of EON US. The acquisition includes payments of approximately $6.7 billion to the seller and the assumption of $925 million of tax-exempt debt. The firm also assisted PPL in connection with arranging a $6.5 billion bridge facility from Bank of America Merrill Lynch and Credit Suisse in case permanent financing was unavailable.

Skadden Arps Slate Meagher & Flom remains at the top of its game in terms of both deal volume and complexity. One peer says the firm is "probably our strongest competitor" while another rival notes, "I believe they belong at the top of the pile."

"They have got good results for us," says one client. "They are responsive and pleasant to work with, and they are experts in their field."

In an ongoing transaction, Skadden is representing long-time client DuPont in its $6.3 billion acquisition of Danish food ingredient manufacturer Danisco. The firm also represented DuPont in a related $6 billion acquisition financing.

The firm is also advising News Corporation on its ultimately withdrawn offer to acquire the entire current and to-be-issued share capital of BSkyB, which is not already owned by News Corporation. The proposal values the fully diluted share capital of BSkyB at $17.8 billion.

Sullivan & Cromwell is a leader in global M&A, advising principals in more than $1.45 trillion of transactions over the last five years. According to end-of-year statistics by Thompson Reuters, the firm led the field by value of M&A transactions successfully completed worldwide in 2010.

The firm's international scope and responsiveness has scored it points with its clients. "You could get hold of them 24-7," says one patron. "I could send out an email at 3 o'clock in the morning and someone would get back to me. That was good because it was a global acquisition."

Another client singles out partner Duncan McCurrach for praise. "We were doing a structure that is very complex and he came out with constructive ideas on how to assemble it," he says. "From my perspective, he has been very helpful."

In the largest deal announced so far in 2011, the firm is advising AT&T on its $39 billion acquisition of T-Mobile from Deutsche Telekom. The transaction is expected to close in first quarter 2012.

The firm also represented the independent director committee of eye care company Alcon in the largest merger in Switzerland's history. The transaction involved the $12.9 billion acquisition of the remaining publicly held minority interest in Alcon, by health care company Novartis. It closed in April 2011.

The first-class M&A practice of Wachtell Lipton Rosen & Katz continues to occupy a place in the top tier of the rankings this year. The firm has particular expertise in defending companies that are under attack by shareholder activists. "They have got a lot of good people at Wachtell," says one competitor.

In particular, peers express respect for founding partner Marty Lipton, whom one describes as "the godfather of M&A". "When you think of Wachtell and high-profile deals, you think of Lipton," says one competitor. Steven Rosenblum, the co-chair of the firm's corporate group, is described by one rival as "Someone I like a lot. He's very easy to do business with - very straightforward and focuses on the important issues." Partner David Katz is also "very well thought-of" in the industry, according to competitors.

Recent highlights of the firm's work include advising Wyeth's board of directors in the $68 billion acquisition of the company by pharmaceutical giant Pfizer. Wyeth was previously owned by American Home Products Corporation. The firm also represented Morgan Stanley in its $9 billion sale of equity securities to Mitsubishi UFJ Financial Group.

Cleary Gottlieb Steen & Hamilton has worked on many of the most significant M&A transactions announced during the past year. The firm has particular expertise in complex, cross-border deals, according to peers. "Cleary has a very strong international network," says one competitor. "They tend to get involved in a lot of big international deals."

The dedication of the firm's attorneys has impressed its clients. "When they take on a matter they are absolutely committed, no matter what the pressures may be, and we have had very successful outcomes with them," says one patron. The client singles out partner Glenn McGrory as being "at the top of my list". The client says, "He will work 24-7 to make sure we have what we need." In September 2010, partner Filip Moerman, who advises on M&A, private equity and restructuring, transferred to the firm's New York office from Beijing and Hong Kong.

In the largest deal announced worldwide during the first three quarters of 2010, the firm represented BHP Billiton in its $40 billion all-cash offer to acquire PotashCorp. The August 2010 transaction was ultimately blocked by the Canadian government.

The firm also counselled Google in multiple transactions including its $750 million acquisition of AdMob, a mobile display advertising technology provider, and its $700 million acquisition of ITA Software, a developer of software for the travel and airline industry.

Weil Gotshal & Manges has impressed peers with its increasing influence on the global M&A market. During 2010, it acquired significant new clients such as French aerospace and security conglomerate Safran, the UK-based Man Group, radio group Citadel Broadcasting and Eli Lilly. "Weil Gotshal has certainly been moving up," says one competitor. "They have some real bright sparks and they have had a couple of big deals. For a firm that was not traditionally a powerhouse, they have earned their place on the list." The firm has particular strength in evaluating takeover defences and in connection with hostile bids, proxy contests and shareholder activism.

In one of the largest media deals in recent years, the firm represented General Electric and NBC Universal in a $37.3 billion joint venture with Comcast. The transaction resulted in a new media powerhouse, with Comcast holding a 51% share and GE holding 49%. The new entity controls a broadcast network, cable TV networks, local TV stations, a movie studio and theme parks. The transaction closed in January 2011.

In another blockbuster deal, Weil Gotshal advised Sanofi-Aventis in a $20.1 billion transaction which represented the pharmaceutical company's first acquisition of a US biotech company. The deal closed in April 2011.

Cadwalader Wickersham & Taft has worked on some of the largest and most complex M&A deals. The firm suffered the loss of rainmaker Dennis Block, who left in September 2011 to join Greenberg Traurig, where he will chair the global M&A practice group. However, it recently boosted its M&A team with the addition of several partners. These include Rocky Lee and Drew Chapman, who arrived in May 2010 from DLA Piper, and Karen Dewis, who came from McDermott Will & Emery in January 2011.

In a deal announced in October 2010, the firm represented Pfizer in its $3.6 billion acquisition of King Pharmaceuticals. The transaction closed in March 2011.

Other recent triumphs include advising JPMorgan as financial advisor to Clinical Data in its $1.2 billion sale to Forest Laboratories. Forest Laboratories expects the deal to leverage its antidepressant business with the addition of Clinical Data's Viibryd. The transaction closed in April 2011.

Debevoise & Plimpton's M&A lawyers consistently lead transactions for household names. In 2010, the firm worked on over 100 announced or completed M&A deals worth over $177 billion.

In a deal which closed in February 2011, the firm represented Prudential Financial in its $4.8 billion acquisition of Japan-based AIG Star Life Insurance and AIG Edison Life Insurance from AIG. AIG intends to use the proceeds to pay down its debt to the US government.

The firm also advised Hewitt Associates in its $4.9 billion merger with Aon Corporation. The $4.9 billion deal closed in October 2010.

Described by one competitor as having a "solid US practice", Gibson Dunn & Crutcher has particular experience in M&A deals with a cross-border component. The firm recently added four new M&A partners to its ranks. Peter Hanlon arrived in January 2011 from Willkie Farr & Gallagher, Jeffrey Chapman and Robert Little joined from Vinson & Elkins in February 2011, and Christopher Dillon came from investment bank Union Square Advisors in March 2011. A client of the firm describes its lawyers as "very responsive, creative and thorough".

In a deal which closed in June 2010, the firm advised Kraft Foods on its $19 billion acquisition of confectionary company Cadbury. The transaction involved working with the US SEC and the UK Takeover Panel, and handling conflicts between regulations in the two jurisdictions.

Other recent highlights include representing Heineken in its $7.7 billion acquisition of FEMSA Cerveza, the Mexican and Brazilian beer subsidiary of Fometo Economico Mexicano. The transaction, which was named M&A Deal of the Year in IFLR magazine's Americas Awards, was the largest worldwide M&A deal in the beverage industry in 2010. It was the first time since 1968 that Heineken issued shares in connection with an acquisition.

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.

Paul Weiss Rifkind Wharton & Garrison is regarded by competitors as having an increasing presence on M&A deals. "Paul Weiss is interesting," says one competitor. "They are obviously doing very well as a firm. They have a couple of local relationships and have done a great job of growing market share over time. It's a fine firm." The firm recently promoted M&A/corporate lawyer Neil Goldman to partner in its New York office.

The firm recently couselled Genco Distribution on its $575 million merger with ATC Technology. The deal, which closed in October 2010, enabled Genco to double its size by making ATC a wholly-owned subsidiary of Genco. Private equity firm Greenbriar Equity Group acquired a 20% interest in the combined company.

Other notable work includes representing The Carlyle Group in the $2.4 billion sale of its majority stake in kbro, one of Taiwan's largest cable TV operators, to Wealth Media. The transaction closed in December 2010.

With a global practice that is the envy of its rivals, Shearman & Sterling is ideally positioned to tackle big, cross-border M&A deals. In 2009 and 2010, the firm advised on M&A transactions totalling $707 billion worldwide. One client praises its lawyers' "crisp and concise" communication, adding, "They are able to give a very comprehensive answer. Their lawyers are exceptionally good at the large transactions."

In a deal announced in April 2011, the firm is representing Nasdaq OMX in its joint $11.3 billion bid with IntercontinentalExchange for NYSE Euronext. The proposal represents a 19% premium over the price proposed by Deutsche Boerse, based on Deutsche Boerse's closing share price as of March 31, 2011, and a 27% premium over NYSE Euronext's unaffected stock price on February 8, 2011.

Other notable work includes advising mobile software provider Sybase in its agreement to be acquired by SAP America, a subsidiary of Germany-based SAP, which provides business software. SAP America made an $5.8 billion cash tender offer for Sybase common stock. The tender offer was followed by a merger, and included a top-up option. The deal, which was announced in May 2010, was a cross-border transaction with a foreign buyer, and involved German and US law. The firm also represented Sybase in related shareholder litigation in California and Delaware.

During 2010, Weil's M&A team attracted significant new clients, such as French aero-space and security conglomerate Safran, Man Group, Citadel Broadcasting and Eli Lilly. A client says, "I think a couple of things I value are the high-tech, excellent service, the immediate responses, the professionalism. We believe that they have good judgement." A competitor remarks, "They have some real bright sparks and they have had a couple of big deals."

In one of the largest media deals in recent years, the firm represented General Electric and NBC Universal in a $37.3 billion joint venture with Comcast. The joint venture resulted in Comcast holding a 51% share while GE holds 49%, creating entertainment holdings including a broadcast network, cable TV networks, local TV stations, a movie studio and theme parks. The transaction closed in January 2011.

In another high-stakes deal, the firm counseled French pharmaceutical company sanofi-aventis in its $20.1 billion takeover of American biotechnology firm Genzyme. The transaction closed in April 2011.

Sidley Austin continues to be regarded as a strong competitor in M&A, despite the loss of M&A star Christopher Hilbert to Jones Day in June 2010. The firm recently represented Health Care REIT in its $2.4 billion pending acquisition of Genesis HealthCare. The deal was announced in February 2011.

In another noteworthy matter, the firm advised Aon in its $4.9 billion acquisition of Hewitt Associates. The transaction closed in October 2010.

Ropes & Gray is a fresh entry to the M&A rankings this year, following favourable feedback from peers. Competitors say the firm "definitely belongs someplace on the list" thanks to the leadership of the "well-respected" Al Rose.

The firm recently represented biotechnology company Genzyme, in its $20.1 billion sale to sanofi-aventis. The deal closed in April 2011.

In a transaction which made international headlines, Ropes & Gray advised TPG Capital and Leonard Green & Partners in the $3 billion acquisition of clothing retailer J Crew Group. The deal, which closed in March 2011, involved complicated issues including TPG's pre-existing relationship with J Crew, the presence of TPG founding partner James Coulter on J Crew's board, and the issue of retaining the services of J Crew's chairman and chief executive Millard "Mickey" Drexler after the deal.