- Date
- 10 March 2021
#4 The Legal Profession This Week - Restructuring Boom
By Violet O'Gorman |
Law firms with large restructuring practices likely experienced a boom during the pandemic, because of tough trading conditions for companies - particularly for those reliant on in-person trading. A multitude of suffering businesses have entered into restructuring arrangements in recent months, and these developments have seen firms such as Weil, Gotshal & Manges reporting strong financial performance in their restructuring groups. Weil, Gotshal & Manges in particular has a restructuring practice known for “its dominant market share in representing debtors in Chapter 11 cases” (The Lawyer). Chapter 11 is a US procedure involving a company voluntarily filing for bankruptcy, and undergoing restructuring for debts and obligations. The firm has advised various companies, including CEC Entertainment, Skillsort Corp., and J.Crew Group, on Chapter 11 cases this year. This surge in cases has driven revenue, providing a hedge against the potential slowdown in other practice areas.
Shoosmiths has recently launched a new consultancy arm – ‘Shoosmiths8 Connected Services’, with the aim to help their clients with legal “as well as broader business requirements” (The Lawyer). The consultancy branch, which includes various different products and services across eight product units, comes amidst a recent uptick in law firms looking to diversify their offering due to increasing competition from alternative business providers, both in law and consultancy. Shoosmiths' national head of commercial group, David Jackson, told The Lawyer that the pandemic has also contributed to the decision, explaining how the “mindset that has arisen over the last 12 months to do things differently” (The Lawyer) means the firm is “trying to encourage clients to approach what they’ve done historically in a different way” (The Lawyer). Other law firms may follow suit, as they might see the pandemic as an opportunity to rethink strategy - particularly in light of new client problems and opportunities arising from working from home.
‘Business as usual’ – the notable deals and cases which went ahead this week:
Various law firms have been involved in the recent decision by two private equity firms, TDR Capital and I Squared Capital, to form a “special purpose vehicle called Albion Acquisitions” (The Lawyer) so that they could make a bid for the buyout of equipment supplier Aggreko, worth £2.3 billion. Kirkland & Ellis advised TDR Capital and I Squared Capital, with Skadden Arps Slate Meagher & Flom also advising funds managed by I Squared Capital. Aggreko was advised by Slaughter and May, with Dickson Minto advising on Scottish law aspects of the deal too.
Law firms Reed Smith and Allen & Overy have recently acted on opposite sides of the acquisition by the Daily Mail and General Trust (DMGT) of the New Scientist, in a deal reportedly worth £70 million. DMGT were advised by Reed Smith on the deal, whilst the consortium of individuals selling New Scientist were advised by Allen & Overy. One of the corporate sellers of the New Scientist title was also separately advised by Freshfields Bruckhaus Deringer. The buyers, DMGT, are “hoping to expand into the subscriptions market” (The Lawyer) through the purchase, which will also strengthen their publishing portfolio.
