Wachtell Lipton Rosen & Katz stands out as a remarkable entity in the corporate law arena. With a single office in Manhattan and fewer than 300 lawyers, it has managed to carve a niche for itself among global legal behemoths. This article delves into the firm's unique structure and its prowess in handling various legal matters.
Unparalleled Expertise in Corporate Law
Restructuring and Finance Expertise
Wachtell Lipton Rosen & Katz offers a one-stop shop for restructuring and finance matters. From acquisition financing and capital structure design to liability management and corporate restructurings, their team is well-versed in handling billion-dollar puzzles. For instance, in the Chapter 11 reorganization of drugmaker Mallinckrodt and the purchase by Overstock.com of Bed Bath & Beyond's intellectual property, the firm demonstrated its comprehensive capabilities. Partner Emil Kleinhaus emphasizes the firm's unique structure, which covers the full spectrum from pure finance to restructuring and has litigators working side by side with transactional lawyers.The recent financing side work includes advising clients like Salesforce, Hewlett Packard Enterprise, and 3M on securities offerings and bank financings. In the emerging liability management space, the firm has been involved in several high-profile transactions, such as those of Lumen, Envision, AMC, and Team Health. Gregory Pessin, a finance expert, played a crucial role in helping X Corp. prevent Elon Musk from terminating the acquisition agreement.Michael Benn, a Restructuring and Finance partner, explains that the firm's first step with a client is to understand the overall business and legal situation and then attack the problem. Once the possible solutions are identified, the firm's structure enables them to execute the chosen strategy effectively.Transaction Law Practice
Emily Johnson joined Wachtell as an associate in 2010 and was elected partner in 2018. Her practice focuses on transactional law within the Restructuring and Finance group and includes advising NBA legend Michael Jordan on the $3B sale of his majority stake in the Charlotte Hornets. Johnson believes in understanding debt as a life-cycle product and how it informs the approach during different times.In her early years at the firm, she handled a wide variety of matters, which helped her understand the full complexity of the capital life cycle. One of her notable matters was steering the financing aspects of the 2020 separation of industrial giant United Technologies into three public companies and its merger with Raytheon. The rebalancing of the existing $45B debt load among the three businesses and setting up the new public companies' inaugural capital structure was a complex process that required precise and strategic drafting. Wachtell worked on this for over a year, facing challenges like the outbreak of Covid-19.Group Mergers and Specialization
After its founding in 1965, Wachtell initially followed a more conventional practice model of separating restructuring and finance. However, as the firm realized the importance of a substantial finance practice for an M&A practice, the two practices merged into a single entity. By 2007, the Creditors’ Rights group was renamed Restructuring and Finance.John Sobolewski, a partner in the group, regularly handles liability management work and believes that the market trend over the last 15 years has dovetailed nicely with the group's design. Benjamin Arfa, who previously worked at Goldman Sachs, highlights the advantage of having one set of people with expertise across practice areas to deliver superior results for clients.The ReFi group helps underscore Wachtell's singularity in the market as an elite strike force of dealmakers. The firm's approach is to first understand the client's business and explore various avenues for solutions. Whether it's a short- or long-term problem, balance sheet restructuring, or liquidity infusion, the Wachtell team can guide the client through it.In a novel financing deal for Rayonier Advanced Materials in 2023, Arfa and Benn helped put together a complex $250M credit facility with a "double dip" loan. They were able to use their knowledge of the existing debt financing to engineer a transaction to get the company through a rough patch.In a deal with Lumen Technologies in March 2024, Wachtell represented the company in the biggest liability management transaction. The negotiations had a restructuring-style dynamic, and the firm led the company through a comprehensive debt realignment transaction.Problem-Solving and Toolkit
Josh Feltman has been at Wachtell since 2002 and has worked on various complex deals like Enron and WorldCom. The firm's standard partner track and associate training expose lawyers to different aspects of the business cycle, giving them the toolkit to handle complicated deals.For example, in the EDMC case, Wachtell designed an innovative out-of-court restructuring structure for an education company facing financial troubles. The firm's litigators, like Kleinhaus, play a crucial role in structuring transactions from the outset to avoid potential issues.In recent times, due to higher interest rates and economic uncertainty, the Restructuring and Finance Group has been particularly busy. The firm reported an increase in Chapter 11 filings and companies turning to out-of-court solutions. Pessin also noted the challenges and recent developments in the high-yield debt markets.The firm's collaborative culture is key to handling the workload. Partners have bi-weekly lunches where they discuss deals, and there are social gatherings like "Champagne Thursdays" and "ReFriday" to celebrate. The ReFi group now numbers 37 lawyers, and the firm invests in developing associates to keep the team tight-knit and operating at the highest levels.Despite the firm's success, there is a sense of loss when associates leave. However, the firm's family-like atmosphere and respect for each other ensure that they continue to thrive in the ever-changing legal landscape.