Loading...
The first six months of 2023 witnessed a cooling trend in the mergers and acquisitions (M&A) market, as global M&A activity contracted to $1.3 trillion, marking the slowest first-half deal-making period since 2020, according to recently released data from Refinitiv. The total value of global M&A deals plummeted by 37% compared to the same period in 2022, as reported by Refinitiv.
Despite the challenging market conditions, Latham & Watkins emerged as the leading law firm in Refinitiv’s principal adviser ranking based on the value of globally announced deals. This marked a significant jump for the Los Angeles-founded firm, which had secured a third-place ranking during the corresponding period the previous year. Latham & Watkins contributed to deals worth approximately $173.5 billion by the end of June.
While Latham & Watkins ranked fifth in terms of the number of transactions, having served as the principal adviser on 238 announced deals, Goodwin Procter claimed the top spot in this category. Goodwin Procter acted as the principal adviser on 396 deals, with a combined value of around $46.7 billion.
Although the year-over-year comparisons depict a dramatic decline following a robust first half of 2022, there were signs of a possible leveling out in the second quarter of 2023, as noted by Matt Toole, the director of deals intelligence at Refinitiv. The report indicated a 33% increase in activity during the second quarter compared to the year’s first quarter.
Find the perfect match for your legal expertise and experience with BCG Attorney Search.
While second-quarter M&A activity still lagged behind last year’s levels, investment bankers and lawyers expressed optimism that the stock market’s recovery would gradually restore confidence among chief executives regarding deal-making.
Get JD Journal in Your Mail
Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!
Law firms responded to the declining demand for legal services by implementing layoffs or downsizing since late last year when deal activity slowed amidst high-interest rates and inflation. Additionally, several technology-focused law firms chose to defer the start dates for their incoming classes of first-year associates from the fall to January.
In terms of principal advisers on global announced deals by value, Kirkland & Ellis ascended to the second spot, a significant improvement from its fourth-place position during the first half of the previous year. Kirkland & Ellis played a key role in 299 deals, amounting to approximately $158.2 billion during the first half of 2023.
Paul, Weiss, Rifkind, Wharton & Garrison, Sullivan & Cromwell, and Davis Polk & Wardwell also showcased notable advancements in the rankings, each climbing higher compared to the previous year.
Conversely, Wachtell Lipton Rosen & Katz experienced a decline in its position, dropping to sixth place in deal value from its second-place standing during the first half of the previous year. Similarly, Simpson Thacher & Bartlett, the previous frontrunner in terms of deal value during the first half of 2022, fell to the eleventh position in the latest rankings.
Overall, the M&A market faced headwinds in the first half of 2023, resulting in a slowdown in global activity. Nevertheless, law firms such as Latham & Watkins and Kirkland & Ellis demonstrated resilience and adaptability in navigating these challenging circumstances. The second quarter of 2023 offered a glimmer of hope with increased activity, and industry professionals anticipate the recovery of the stock market to revive confidence among executives, paving the way for renewed deal-making in the near future.
Don’t be a silent ninja! Let us know your thoughts in the comment section below.
