Kirkland & Ellis LLP is emerging as a leader in the law firm competition to advise on the most, and highest value, mergers and acquisitions.

The firm, which was founded in Chicago, topped all others in Q1 2019 by guiding companies through 142 global deals valued at a collective $176.8 billion, Bloomberg data show. It played a role in five transactions worth at least $10 billion each, including Bristol-Myers Squibb Co.'s pending $88 billion purchase of Celgene Corp. — the most expensive of the quarter.

Kirkland’s capturing the most first-quarter dollar volume underscores the intensifying competitiveness of the deal advisory sector, where more firms have beefed up their transactional practices and become increasingly involved in big-money mergers.

“We’re continuing to see some of the regional firms that have gone national make inroads into a space they used to be excluded from,” said Diane Holt, a Bloomberg Law legal analyst and former corporate transactions lawyer. “Kirkland, originally a Chicago firm, is now bigger than the big boys.”

Jones Day had the sixth-largest deal volume in Q1 2019 despite not cracking the top 20 during the same period last year. It’s one of a few firms in recent years to work on more high-value public company mergers and acquisitions after growing its deal count.

Law firms advised a smaller number and dollar volume of deals at the beginning of the year than in Q1 2018, according to Bloomberg data. The global volume of mergers and acquisitions dropped about 9.1 percent to $876.7 billion on 333 fewer transactions.

The decline in first-quarter activity is due, in part, to volatility in equity markets near the end of 2018, and to the partial U.S. government shutdown, said Jeff Grossman, who leads business development and strategy for Citi Private Bank’s Law Firm Group. The shutdown may have also put a damper on deals coming through the pipeline, he added.

“Hours per lawyer are slightly lower than last year,” Grossman said, as firms added attorneys in light of 2018’s strong deal activity and now find there’s less work to go around.

Global deal activity often starts the year slow, but picks up near the end of the first quarter.

Despite a few uncontrollable economic and geopolitical developments, a “resounding number” of Citigroup’s law firm clients are optimistic about 2019, given what they have teed up, said Owen Ellsworth, escrow business development director at Citi Private Bank’s Law Firm Group, “It should still be a pretty decent year for M&A.”

Deals & Industries

Several firms buoyed their first-quarter volumes by securing advisory roles in at least one of the six pending deals worth $20 billion or more.

Simpson Thacher & Bartlett LLP, which had the second largest market share among firms based on volume, advised First Data Corp. in its $38.1 billion sale to Fiserv Inc. Latham & Watkins LLP also advised First Data, while Sullivan & Cromwell LLP served as Fiserv’s principal adviser, Bloomberg Law deal analytics show.

Mergers and acquisitions among companies that offer non-discretionary products or services comprised the biggest slice of first-quarter deal activity with 28 percent. Deals in the financial industry totaled $185.6 billion, or 21.2 percent of all transactions, Bloomberg data show. The basic materials industry had the third-highest deal volume, followed by deals in the technology sector.

About $490 billion worth of company takeovers were announced or completed during the Q1 2019, the most of any deal type. Private equity transactions totaled $273 billion, while first-quarter cross-border activity was valued at $270 billion.

Citi’s Ellsworth said firms with bigger private equity practices often drive a large amount of deal flow. “Those firms tend to do pretty well in this current M&A environment.”