Thursday, August 18, 2022

Kirkland & Ellis Revenues Soar To $ 5 Billion Thanks To Private Equity Transactions

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Kirkland and Ellis, the world’s most profitable law firm, is on track to generate record annual revenue of around $ 5 billion following overwhelming demand during the pandemic.

The powerful business advisor’s revenue was around $ 5 billion for the 12 months ending in late January, according to insiders, up from $ 4.15 billion the year before. It follows a year in which three of the firm’s strongest areas – private equity, restructuring and litigation – all delivered strong growth.

“It has been mind-blowing,” said a partner of the company’s performance. “It was a shock.” Kirkland declined to comment.

Kirkland & Ellis has grown rapidly over the past decade, fueled by a private equity boom and an aggressive expansion strategy that involved poaching top talent from rivals in London and New York.

According to several equity partners – who took in more than $ 5 million last year on average – the Chicago-based company is keen to downplay its results amid concerns about how such outperformance might be received over a period of time. global pandemic. Kirkland does not publicly disclose its financial results, but it does show up in the annual ranking of the American lawyer.

One partner said: “We have certainly had a great year, but we can’t say it too loudly when so many people are in pain.” Another said: “This crisis is a humanitarian issue, so it doesn’t seem fair to talk about your efforts.”

The company’s outperformance follows surprisingly high work volumes in the private equity sector who catapulted Kirkland in the global elite, and litigation and restructuring, which tend to work well in times of economic crisis.

Lawyers had expected M&A and private equity deals to decline, but by year-end the value of private equity deals had skyrocketed to its highest level since 2007.

Kirkland topped Mergermarket’s ranking for global buyouts in terms of number of deals and value in 2020, and for global exits. The company advised $ 111.5 billion in buyouts and $ 82.5 billion in exits.

Profits are also expected to be supported by a sharp reduction in business travel and expensive conferences.

“Industry-wide, there was less spending last year because no one was traveling,” said Freddie Lawson of Fox Rodney, a legal recruiter. “There was no conference, lavish entertainment or foreign partner conference. This had a big impact on costs. ”

Kirkland occupies the top echelon of America’s legal elite alongside Latham & Watkins, which generated nearly $ 4 billion in 2019 and was the world’s largest corporation until 2018. Other top rivals include Wachtell, Lipton Rosen & Katz, Sullivan & Cromwell and Cravath.

A series of American companies have chosen to pay a a series of special bonuses to junior lawyers last year in addition to significant end-of-year awards of up to $ 140,000 for some partners.


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