Mergers position top firms for M&A

Northern Colorado and Boulder Valley law firms are merging with other firms and acquiring partners with specialized knowledge in mergers and acquisitions to handle the same type of transactions.

Businesses focused on technology, oil and gas, natural foods and other key industries are engaged in buyouts and mergers — and seek local law firms to handle their transactions. The merger market is becoming increasingly attractive to law firms seeking to help their business clients.

In the latest move, Ballard Spahr merged with Lindquist & Vennum on Jan. 1 to expand the firm’s mergers and acquisitions expertise. The combined firm, which retains the name Ballard Spahr LLP and is based in Philadelphia with offices in Denver and Boulder, now will have more than 650 lawyers in 15 offices nationwide, including a presence in Minneapolis and Sioux Falls, S.D., and an expanded office in Denver.

In September, Ballard Spahr merged with Levine Sullivan Koch & Schulz, a First Amendment and boutique media law firm with a Denver office. Both provide media law services, and Ballard Spahr’s Denver office also offers corporate, litigation, public finance, and labor and employment services.

Lindquist & Vennum’s focus is corporate mergers and acquisitions, bankruptcy and litigation.

“Clients often require services and specialties other than corporate law. One law firm can provide a full scope of services,” said Steven Suflas, managing partner of the Denver office. “From Ballard Spahr’s perspective, the Lindquist & Vennum merger offered us a couple of attractive opportunities. In particular, the Minneapolis office’s practice was mergers and acquisitions for private equity clients.”

The merger between Ballard Spahr and Lindquist & Vennum expands what both firms can offer, said Ted Hartl, a partner in the bankruptcy group for Lindquist & Vennum and now a partner with Ballard Spahr. Lindquist & Vennum focuses on representing companies that want to restructure or sell their assets or acquire additional assets, he said.

“The marriage and merger makes a lot of sense,” Hartl said. “They get more work for the existing lawyers, instead of the client shopping elsewhere to get their needs met and goals achieved.”

Lindquist & Vennum provides Ballard Spahr with an opportunity to expand its bankruptcy representation, Hartl said.

“Ballard Spahr is historically a business-focused law firm,” Hartl said. “Denver is an insular market. To have one-stop shopping at Ballard Spahr for any corporation or business, whether they’re doing a merger and acquisition deal, a dispute that involves litigation or whether they have a bankruptcy problem or a labor dispute, any of those services, Ballard Spahr has the lawyers that can address the clients’ needs.”

The merger of Ballard Spahr with Levine Sullivan Koch & Schulz increased the capabilities of both firms, said Steve Zansberg, partner with Ballard Spahr and formerly with Levine Sullivan.

“By joining Ballard Spahr, our media clients have access to a broader range of services our family of litigators was unable to offer,” Zansberg said. “It’s created synergies within the firm to be able to collaborate with colleagues in other cities and to be able to offer services to media and emerging media clients that we could not offer.”

In two years, Ballard Spahr has made four major acquisitions, including opening an office in Boulder by acquiring Gross Cutler Seiler Dupont LLC in fall 2016 and Denver-based Donelson Barry Stross LLC in spring 2016. Both firms are focused on mergers and acquisitions.

Ballard Spahr’s acquisitions added a total of 16 lawyers to the Denver and Boulder markets, Suflas said.

The firm’s activities follow a trend among law firms over the last 25 years to expand in geographic scope and specialty, Suflas said. In the past, law firms were regionally based and served their local areas, he said.

“Law firms are not immune to that larger economic trend,” Suflas said. “Given the strong client relations in one area of specialty, their clients would be interested in using Ballard Spahr for other specialties. It’s the full scope of legal work. … Because the economy is good and interest rates are low, we’re seeing a good deal of corporate work.”

The trend for law firms to increase their mergers and acquisitions activity is market-driven, said Clay Bartlett, an attorney and partner with Coan Payton & Payne in Fort Collins, a law firm with offices also in Greeley and Denver and 24 attorneys.

“Our and other firms are responding to an increase in merger and acquisition transactions in the market. It’s been a trend we saw start in the last year and a half and still seems to be increasing,” Bartlett said.

Bartlett identified local economic recovery as one reason with sellers wanting to cash in on higher prices and buyers more willing to take risks, he said. Following the downturn starting in 2007, sellers did not sell for a five-year period because their properties were devalued, resulting in a “built-up supply of companies coming to market,” he said.

“We were ready to go and saw this ahead of time,” Bartlett said. “We’ve been working on an increased number of merger and acquisition transactions over the last couple of years. …When the general economy is strong, you see more merger and acquisition transactions. When the economy is weak, you see it slide. …  In good times, there are more deals, and in bad times there seem to be fewer.”

Other reasons for merger and acquisition activity include owner retirements, entering a new business venture, buying out competitors for more market share and expanding into the supply chain, Bartlett said.

“Instead of paying somebody else to fulfill a part of the supply chain, you can hopefully do it cheaper to increase your profit margin and capitalize on economies of scale,” Bartlett said.


Go to Source