The most complex mergers and acquisitions are usually a nexus of legal issues as much as financial ones.
Due diligence, where much of the value is added, is primarily composed of legal issues.
Thus, it should come as little surprise that the largest legal firms are now prominent in the listings of the largest M&A intermediaries in the world.
DealRoom team works with many M&A law firms helping them organize M&A process and below, we look at the ten biggest, as well as providing detail on some of the transactions they’ve helped to close over the past period.
The role of the M&A legal team is not only to ensure that the headline details of the transaction are sound, but also that the finer details (‘the small print’) do not create any inherent risk for the buyer or seller.
Below, we look at the top M&A law firms in more detail:
1. Cravath, Swaine, & Moore LLP
The client portfolio of Cravath, Swaine, & Moore, is probably the envy of many first tier investment banks, let alone the legal industry.
The deals closed by this legal firm in 2020 are testament to its prowess in the M&A industry. It advised on deals such as:
- Mylan’s $50 billion acquisition of Upjohn,
- Justeat.com’s $7.3 billion acquisition of Grubhub,
- and Viacom’s $30 billion merger with CBS Corporation.
Interestingly, a prominent client of this company is Walt Disney, whom it advised on its acquisition of Marvel, widely regarded as one of the most successful deals of the 21st century.
2. Davis Polk & Wardwell LLP
Davis Polk & Wardwell is always on the top ten of this list, but this is the first time that it has reached second place for dealmaking.
Its client list is an indication of how the industry views its capability in this realm.
In 2020, it advised on Morgan Stanley’s game-changing acquisition of E*Trade for $13 billion, Charles Schwab’s all-stock acquisition of TD Ameritrade (valued at $26 billion) and Gilead Science’s $21 billion acquisition of Immunomedics.
Other clients on its roster include ExxonMobil, Heineken, and Comcast.
3. Kirkland & Ellis LLP
Kirkland & Ellis is considered to be the law firm of choice for most of America’s technology giants.
It worked alongside Cravath, Swaine & Moore on the Justeat and Grubhub deal, for example.
However, its intermediary work during the Covid-19 pandemic has been much more centered on deals involving big pharma.
Examples include advising Bristol Myers Squibb on ifs $90 billion cash and stock acquisition of Celgene Corporation, and advising AbbVie on its $83 billion cash and stock deal for Allergan.
4. Latham & Watkins LLP
If Kirkland & Ellis is the technology specialist on this list, Latham & Watkins is probably the SPAC specialist.
And with SPAC deals growing by double digits in each of the last ten years, it is far to say that this has been a good period for the partnership.
As with many of the firms on this list, it has a strong portfolio of pharmaceutical and biotech firms on its roster.
This allowed it to advise on deals such as NVIDIA on its $40 billion acquisition of Arm Limited, and Siemens Health on $16.4 billion acquisition of Varian Medical Systems.
Among its better known clients are AON and JP Morgan.
5. Paul, Weiss, Rifkind, Wharton, & Garrison LLP
The blue chip clients of Paul, Weiss, Rifkind, Wharton & Garrison include IBM, Chevron, Kraft Heinz, General Electric, and Apollo Global Management, one of the world’s leading private equity firms.
What’s notable here is the proliferation of conglomerates – ripe territory for dealmaking.
As such, it shouldn’t be a surprise when it emerges that these companies account for most of the deals that this company works on.
Prominent 2020 deals include General Electric’s $21.4 billion carve-out sale of its biopharma business to Danaher, and the industry-shifting merger between CBS and Viacom.
6. Simpson, Thatcher & Bartlett LLP
Simpon, Thatcher & Bartlett’s clients include Best Buy, the Boeing Corporation, Dell Technologies, and Aramark.
Most of these – the Boeing Corporation being the notable exception – enjoyed unprecedented growth during the Covid 19 pandemic, so may be set for more dealmaking in the years ahead.
2020 saw Simpons, Thatcher & Bartlett advise Refinitive on the sell side in its $27 billion deal with the London Stock Exchange (LSE) and another sell-side advisory role when it advised TD Bank on its takeover by the Charles Schwab Corporation.
7. Skadden, Arps, Slate, Meagher & Flom LLP
Skadden, Arps, Slate, Meagher & Flom LLP has one standout client that is likely to provide good deal flow for its M&A team over the coming years: Netflix.
In 2021, the firm worked with Netflix to buy the much loved children’s author Road Dahl’s estate. Deal activity will surely grow as Netflix attempts to manoeuvre in an ever more crowded filed of streaming companies.
In 2020, Skadden, Arps, Slate, Meagher & Flom advised on deals such as the Willis Towers Watson merger with AON, and on the sell-side in Advanced Micro Devices’ $35 billion takeover of Xilinx Inc.
8. Cleary Gottlieb Steen & Hamilton
Cleary, Gottlieb, Steen & Hamilton’s recent tilt to the west coast suggests that it is targeting silicon valley for its business development efforts, so we shouldn’t be surprised to see it advise on more technology deals in the years ahead.
In 2020, it advised ArcelorMittal on its $3.3 billion sale to Cleveland Cliffs and Flavors and Fragrances Inc. on its $4.5 billion merger DuPont’s Nutrition & Biosciences division.
Its key clients include some of the biggest names around, including none other than Google (Alphabet), 3M Company, and General Mills.
9. Debevoise & Plimpton LLP
Let’s begin by getting the obvious one out of the way: Debevoise & Plimpton is Amazon’s corporate lawyer of choice, meaning that it was the firm that worked on most of the e commerce giant’s major deals until now (including the Whole Foods acquisition).
Other notable clients include American Express and Johnson & Johnson. In 2020, it advised Match Group on its $30 billion separation from IAC, and Interexion’s $8.4 billion merger with Digital Realty.
10. Shearman & Sterling LLP
Shearman & Sterling’s client roster is another impressive list of giants from across the spectrum of sectors.
It includes Raytheon, the Dow Chemical Company, CVS Health Corp, Viacom, and Germany’s SAP.
Notable deals in 2020 included its intermediary work on Raytheon’s combination with United Technologies in a rare merger of equals, and advising Canada Pension Plan (CPP) Investment Board on its $5.1 billion acquisition of Pattern Energy Group.