Despite seeing a rising star leave and a former top rainmaker opt to join a rival Am Law 100 firm, Cravath, Swaine & Moore’s storied M&A practice is on a hot streak of late with a series of key transactional roles, including one this week for longtime private equity client Lindsay Goldberg.
Cravath corporate partners Richard Hall—who earlier this year became the head of the firm’s European M&A group—and Andrew Thompson have taken the lead advising New York–based Lindsay Goldberg and portfolio company Continental Energy Systems on its $950 million sale of the New Mexico Gas Company to Tampa-based TECO Energy, advised by a team of lawyers from Skadden, Arps, Slate, Meagher & Flom and New Mexico’s Cuddy & McCarthy. Thompson also led a Cravath team representing Lindsay Goldberg portfolio company PAE on its $175 million acquisition of an applied technology division owned by Computer Sciences Corp.
"Two deals in two days—it was a busy Memorial Day weekend," says Thompson, who notes that Cravath’s relationship with Lindsay Goldberg dates back more than 20 years to the Bessmer Trust, a privately owned wealth management firm that became Lindsay Goldberg in 2001.
Former Cravath M&A associate J. Russell Triedman is a now a partner at Lindsay Goldberg, which was born when former Morgan Stanley Private Equity founder, chairman, and attorney Alan Goldberg entered into a partnership with the Bessemer Trust. Cravath has been handling transactional work for Lindsay Goldberg ever since, with Thompson taking the lead last summer on an asphalt industry joint venture with San Antonio–based NuStar Energy. Cravath’s Hall also advised former Lindsay Goldberg portfolio company Fresh Start Bakeries on its $900 million sale to Switzerland’s Aryzta in 2010. (Lindsay Goldberg has also turned to Weil, Gotshal & Manges for deal work, with Weil taking the lead on the private equity shop’s $410 million purchase of 275,000 marine cargo containers early this year and its $1.26 billion sale of Keystone Foods to Brazil’s Marfrig Alimentos in 2010. Former Weil private equity partner John Aiello is a Lindsay Goldberg managing director.)
Other Cravath lawyers advising on the proposed sale of New Mexico Gas to TECO Energy include tax partner J. Leonard Teti, employee benefits partner Jennifer Conway, senior environmental attorney Annmarie Terraciano, and associates William Abbott, Michele Cera, Michelle Garrett, Kenneth Gerold, Benjamin Hewitt, Jarrett Hoffman, Curtis Weber, and Matthew Williams. The deal, which includes the assumption of $200 million in debt by TECO, is expected to close in the first quarter of 2014.
Cravath’s Thompson, Teti, Conway, and Terraciano also led a team this week counseling Lindsay Goldberg and PAE on their purchase of CSC’s applied technology unit. The other Cravath lawyers working on the deal are environmental partner Matthew Morreale, practice area attorneys Michael Krasnovsky and Lawrence Pasini, and associates Christopher Barnstable-Brown, Neetin Gulati, Morgan Harper, Kara Mungovan, and Raku Raku. Cravath had counseled Lindsay Goldberg two years ago on its acquisition of PAE—formerly known as Pacific Architects and Engineers—from Lockheed Martin for an undisclosed sum.
The Lindsay Goldberg deals come on the heels of a pair of what could be considered unexpected developments for Cravath’s M&A group.
In February, former M&A partner James Woolery joined Cadwalader, Wickersham & Taft two years after leaving Cravath to become cohead of North American M&A at JPMorgan Chase, according to our previous reports. Woolery’s move to Cadwalader followed former Cravath M&A partner Sarkis Jebejian’s departure for Kirkland & Ellis, where this month he helped advise consulting giant Accenture on its $316 million acquisition of Acquity Group. Accenture, whose general counsel is former Cravath corporate partner Julie Sweet Spellman, has often turned to Cravath for deal work in the past.
Those distractions notwithstanding, Cravath has spent the first few months of 2013—a relatively slow period for M&A—clinching notable transactions for such clients as Archer Daniels Midland, Lagardere, Life Technologies, and Lender Processing Services.
The Am Law Daily reported Tuesday on Cravath M&A cohead Robert Townsend III’s role leading a team from the firm advising Jacksonville-based LPS on its $2.9 billion sale to Fidelity National Financial. Hall and Thompson advised U.S. agribusiness giant ADM in April on its proposed $3.5 billion buy of Australia’s GrainCorp, while Hall also led a team from the firm that same month counseling Life Technologies on its $13.6 billion sale to Thermo Fisher Scientific.
Cravath also represented French conglomerate Lagardere in April on the roughly $3 billion sale of its 7.4 percent stake in European aerospace and defense giant EADS and was on hand for client Assisted Living Concepts as its shareholders approved a $275 million sale of the senior living center operator to private equity firm TPG Capital.
When asked about lateral departures and the state of the current M&A market, Thompson says that Cravath enjoyed a busy year in 2012 and is confident in the number of deals it currently has in its pipeline, although he notes that "it’s always hard to predict" what the future may bring. Thompson is also quick to laud the firm’s hire in February of IP partner David Kappos, a former head of the Patent and Trademark Office, adding that "there’s not much to say about anything else."
Of course, Thompson isn’t the only Cravath partner staying busy.
Richard Levin, who became the first chair of Cravath’s restructuring practice after joining the firm in a high-profile lateral move from Skadden in 2007, has been retained by the Detroit Institute of Arts on issues relating to the Motor City’s looming municipal debt restructuring.
Former Jones Day restructuring partner and Detroit emergency manager Kevyn Orr has suggested that the DIA’s multibillion-dollar art collection is a public asset that could be sold off to cover some of the city’s $15 billion in long-term debt. Levin—who provided pro bono restructuring counsel to Harrisburg, Pennsylvania, prior to its Chapter 9 proceeding—is serving as the lead counsel to the DIA, which claims that its collection is a public trust and thus not for sale.