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May 29, 2009 10:45 AM

Life Is Good for Kirkland and Jones Day Bankruptcy Lawyers. For Their Clients? Not So Much.

Posted by Zach Lowe


On Wednesday, seven bankruptcy partners left Kirkland & Ellis for Jones Day as the demand for the top restructuring lawyers continues to grow.

But, really, you can't go wrong belonging to either firm, a point that was reinforced Thursday when Kirkland and Jones Day won primary counsel assignments for two leading auto parts manufacturers that filed for Chapter 11 protection. 

Kirkland & Ellis is advising Visteon Corp., a Ford Motor Co. spinoff based in Michigan. The company, which makes electronics, climate control technology and just about everything else in your car, listed $4.58 billion in assets and $5.32 billion in liabilities.

Ford, which accounted for nearly a third of Visteon's first-quarter sales this year, has agreed to provide debtor-in-possession financing for Visteon. How much is unclear, though experts suggested Visteon could need between $500 and $700 million in DIP financing, according to the Wall Street Journal

Kirkland, which lured bankruptcy cochair Jamie Sprayregen back from Goldman Sachs in December, has since landed several other plum bankruptcies, including Sun-Times Media and General Growth Properties. 

Jones Day is advising Metaldyne Corp., a Michigan-based supplier of metal auto parts. The company, a unit of Japan's Asahi Tec, already has a preliminary agreement to sell the bulk of its assets to a consortium led by the private equity firm Carlyle Group and RHJ International, another private investment group.

Richard Engman is leading the Jones Day team, court records show. He did not return a message seeking comment. 

Jones Day is also representing Chrysler, the first major U.S. automaker to file for bankruptcy during the current recession. They may have company Monday, when General Motors is expected to file its own Chapter 11 claim. 

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