Summary: It’s that time at Kirkland & Ellis to mix things up and reallocate how their partner profits for equity partners are cut.
Kirkland & Ellis is changing how their equity partner profits are allocated. This move will cut the shares of its top partners, especially their litigation partners. The firm reallocates its equity every two years and will take effective February 1.
One partner explained, “There’s been a reallocation of equity from litigation to corporate and maybe bankruptcy. For the litigators, I heard it was a bloodbath. The general sense is that this is the most recent manifestation of the corporate people taking over the firm.
The firm has an extremely profitable private equity, M&A and bankruptcy practices, which helped bring their profits per partner to $3.6 million last year. Partners were informed of the changes earlier this month. Equity partners were receiving an allotment of shares ranging from 10 to 80. The change puts their shares at 8.5 to 75. The firm’s shares are high at roughly $148,000. This means a partner with 80 shares would earn $11.8 million.
Kirkland is currently led by corporate lawyer Jeffrey Hammes. He has a strong private equity practice before taking over as chairman in 2009. Possible successors to Hammes when his term expires in two years is Mark Filip and Jon Ballis. Filip is one of the firm’s top litigators. Ballis is a private equity partner.
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