Cadwalader's big dipper
8 February 2008
16 September 2013
3 September 2013
7 May 2014
17 March 2014
26 May 2014
Talk about a rollercoaster week. Cadwalader began it by confirming that its head of antitrust, Rick Rule, had scooped a role on one of the deals of the year, Microsoft's $44.6bn bid for Yahoo!
Cadwalader's public yahoos lasted 24 hours. The next day (Tuesday 5 February), it released its year-end figures. They showed a drop in profit of 6 per cent, giving Cads the distinction of becoming the first US firm to post a fall in the bottom line for 2007 (it has since been joined by Heller Ehrman and Howrey, which bettered Cadwalader with a 17.5 per cent fall in profits).
Twenty-four hours after that, Cads was back in the news. This time the firm known for having bet and eventually losing on capital markets and structured finance was taking another punt, on private equity. As we reported on Wednesday (6 February), Cadwalader made an audacious raid on Latham & Watkins, snaring that firm's global co-head of private equity, Ron Hopkinson, and vowing to build a 'top tier' practice.
We can barely wait for the next instalment.
As for Latham, as you might expect sources close to the firm are playing down the loss of Hopkinson, claiming (fairly justifiably and in the typical Latham nicest possible way) that he was only one partner in a hefty group.
What does seem clear is that the firm's key relationships with private equity titans such as Carlyle are rock solid.
Hopkinson was not the Carlyle relationship partner (that honour goes to Dan Lennon in DC), and even if he were, that client is institutionalised within Latham.
It will take more than the exit of one partner, however good and well liked, to see the back of Carlyle.
Good news for Cadwalader
What’s this? Cadwalader in good news shock.
There’s only one deal worth talking about this week: Microsoft’s $44.6bn bid for Yahoo! And, along with Simpson Thacher’s edging out of Sullivan & Cromwell to secure the lead M&A role, the talk right now is of Cadwalader partner Rick Rule and his success in bringing some much-needed cheer to his firm.
“Cadwalader may already have had a relationship with Microsoft but on the face of it, it seems remarkable that an individual who recently switched firms picked up such an enormous instruction,” said Martha Klein, a senior consultant at Mlegal Consulting in San Francisco. “A firm the size of Microsoft would typically have strong institutional relationships with law firms rather than a single individual.”
Rule, you will recall, joined Cads as head of antitrust only last April from Fried Frank. Microsoft has been a client of his for many years, stretching back to the 1990s when he was a key member of the team that negotiated a conclusion to an epic antitrust battle with the US Department of Justice.
With Cads still smarting from the negative press generated by its laying off of 35 associates last month, a fistful of Microsoft dollars in the pipeline will be very welcome. And Rule, such a recent arrival, will no doubt be celebrating.
Still, he’s going to have to work for his money. As one New York partner put it today (Monday 4 February), “[Microsoft general counsel] Brad Smith has been smoking dope if he really thinks this will complete by the second quarter of this year. That’s preposterous. This will take at least a year to 18 months if it gets done at all.”
And what is most likely to derail the deal? Antitrust.
Over to you, Rick.
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