Skadden bills snowball on Kmart

The spate of US bankruptcies is continuing to pay dividends for lawyers, with Skadden Arps Slate Meagher & Flom emerging as the latest firm to rack up millions of dollars in fees.

In its role as legal adviser to Kmart, Skadden has so far gained $33.1m (£20.8m) since January 2002, when the discount retail giant first filed for Chapter 11 protection.

Kmart, which has so far closed 600 of its 2,100 stores and made 57,000 staff redundant, has spent $114m (£71.5m) on advisory fees.

Otterboug Steindler Houston & Rosen, the firm acting for Kmart’s unsecured creditors committee, has so far charged $5m (£3.1m) for its services.

However, it is debatable how much more the firms will gain from the company, as last week a federal judge approved a restructuring plan which would see Kmart emerge from Chapter 11 two months earlier than planned.