Business & Practice

King & Spalding Decades-Long Links Pay Off in Fintech Mega Deal

May 30, 2019, 1:30 PM

King & Spalding represented various parties involved in $30 billion in M&A transactions in 63 deals announced last year. The law firm is set to breeze past that total with 2018’s seventh-biggest deal.

The Atlanta-based firm still ranks below the M&A giants whose tallies of deals this year already approach or even top $200 billion each, according data compiled by Bloomberg. Still, advising Total System Services Inc. in its $21.5 billion merger with Global Payments Inc. takes King & Spalding up a notch as it competes against larger, better-known rivals rooted in New York and London.

King & Spalding hasn’t disclosed the fees it will collect as the sole legal adviser to Total System on the deal, which also includes $3.9 billion in debt. The firm has focused on expanding the scope of its services to M&A clients, reducing the need to split the work -- and fees -- with other firms.

“The firm has been deliberate in making investments in the public company practice,” said King & Spalding partner Keith Townsend, who led the deal with Jim Woolery.

Townsend said King & Spalding’s relationship with Total System and its predecessor company predates his 20-year tenure at the firm. Its M&A practice has focused on not only increasing its staff in New York and other locations, but also on providing clients with a fuller range of services, advising on matters such as tax and finance related to transactions and shareholder activist situations. The latter has included representing Xerox Corp. investor Darwin Deason, whose efforts blocked a takeover by Fujifilm Holdings Corp.

Thirty-seven law firms posted gross revenue of $1 billion or more in 2018, according to American Lawyer’s annual survey, which showed King & Spalding’s revenue had jumped almost 11% to $1.26 billion. The firm rose in the ranking to No. 22 based on revenue, according to a statement. The firm’s corporate finance and investment practice accounts for about 30% of its revenue, Townsend said.

M&A’s Giants

Totals for completed and pending transactions show larger firms including Wachtell Lipton Rosen & Katz, which represented Global Payments on the Total System deal, still dominate M&A work. Wachtell ranks No. 1 so far this year with a 13% share based on its role in 24 transactions totaling $237 billion, data compiled by Bloomberg shows. That firm is followed by Simpson Thacher & Bartlett, with 50 deals for $205 billion, and Kirkland & Ellis, which played a role in 176 deals totaling $197 billion.

With 16 deals totaling almost $26.9 billion, King & Spalding ranks 24th this year, up from 83rd in 2018.

Deal value comparisons provide only a partial picture because law firm fees can be based on hourly rates or a percentage of the transaction value, and can vary depending on the scope of the role, especially when multiple firms are involved.

Americold, Transocean

King & Spalding also advised Americold Realty Trust on its $1.24 billion deal this year to acquire Cloverleaf Cold Storage, according to a statement. Last year, it advised Brookfield Infrastructure on its $1.1 billion deal for data centers from AT&T Inc., as well as Transocean Ltd. on its $2.7 billion acquisition of Ocean Rig UDW Inc.

The firm boosted its M&A credentials in 2017 by bringing in Woolery as head of its M&A and corporate governance practices. Woolery, a former partner at both Cravath Swaine & Moore and the law firm Cadwalader Wickersham & Taft, had also stepped into dealmaking directly as co-head of M&A at JPMorgan Chase & Co. and co-founder of his own investment firm, Hudson Executive Capital LP.

The Global Payments-Total System deal will create a powerhouse that provides payment technology and software to more than 3.5 million small to midsize merchants and more than 1,300 financial institutions worldwide, the two companies said in a statement Tuesday. The all-stock deal values Total System at $119.86 a share, 20% more than its $99.62 closing price on May 23, before Bloomberg first reported discussions with Global Payments.

King & Spalding’s team on the the deal included Rob Leclerc, Nathan Mihalik, Allison Bazinet, Johnny Ellis, Julie Paret, Audrey Rogers and Jonathan Wu, the firm said in a statement.

--With assistance from Peter Blumberg.

©2019 Bloomberg L.P. All rights reserved. Used with permission

To contact the reporters on this story: Ed Hammond in New York at ehammond12@bloomberg.net; Michael Hytha in San Francisco at mhytha@bloomberg.net

To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net Matthew Monks, Joe Schneider

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