Latham & Watkins was the year's most active U.S. law firm advising on transactions valued under $1 billion. The Los Angeles firm's 420 M&A attorneys closed 86 middle-market deals, totaling $26.5 billion in value-a significant amount more than the firm's 2012 tally of 76, worth $19.7 billion .
One of the largest law firms in the country, Latham boasts clients among large public companies, such as Apple Inc. (Nasdaq: AAPL) and Yahoo Inc. (Nasdaq: YHOO). But the firm's middle-market practice is "huge," says Howard Sobel (pictured), a partner in the New York office. Typically, the firm advises on deals that fall between $250 million and $1 billion. For example, Latham partner Tad Freese piloted Yahoo's purchase of Summly for a reported $30 million.
Among the more notable deals Latham worked on in 2013 was private equity firm Leonard Green & Partners LP's high-profile $225 million acquisition of Lucky Brand Jeans from Fifth & Pacific Cos Inc. (NYSE: FNP). The sale allowed the seller to return to its roots as a single-brand company with Kate Spade.
The firm also advised Leonard Green on some fun, albeit complex, transactions. Latham counseled the PE firm's portfolio company Authentic Brands Group LLC (ABG) on purchases of the intellectual property rights of entertainer Elvis Presley and boxing champion Muhammad Ali from Core Media Group. In both deals, ABG owns and manages the intellectual property rights with the celebrity in partnership with their families and with Joel Weinshanker, chairman of National Entertainment Collectibles Association. For example, Lisa Marie Presley continues to own her father's famous home Graceland and the original artifacts, but Weinshanker acquired the rights to manage the operations of Graceland, and ABG acquired the rights to photos and artwork, album covers, movie posters, TV appearances and other assets. ABG and Weinshanker own the rights to Ali's intellectual property, including a large library of photos of the boxing champion and trademark phrases such as "Float like a butterfly, sting like a bee."
"There were between four and five parties we had to negotiate with at any given time," Sobel says of the transactions.
There were also tricky deals in the hotel and gaming space, including MCR Development LLC and its $430 million portfolio purchase in October. New York-based MCR turned to Latham to buy 26 properties across four states, each with long-term franchise contracts tacked onto them with Marriott International Inc. (Nasdaq: MAR) or Hilton Worldwide Inc. (NYSE: HLT).
Latham also advised Koch Industries Inc. on the $878 million privatization of American Greetings Corp.
Another client Sobel worked with was Intermix Inc. in its acquisition by the Gap Inc. (NYSE: GPS) This "David & Goliath" deal, as Sobel calls it, saw Gap pay $130 million for the boutique chain. "We had this huge company acquiring this small company that had a very unique way of doing business," Sobel explains. Intermix CEO Khajak Keledjian ran a trendy boutique chain that wasn't a typical deal Gap would have done, Sobel explains. He worked to get Gap to understand "what kind of expectations they should have regarding the composition of a contract." Also notable is the speed at which the agreement was made.
"We started it in November and completed it right before Christmas," Sobel says. "It was one of those deals where you were shot out of a canon."
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