November 19, 2008 7:02 PM

Cadwalader To Oust Managing Partner

Posted by Nate Raymond

Cadwalader, Wickersham & Taft's former chairman and current managing partner Robert Link Jr. was not included on a recommended slate of candidates for the firm's management committee given to partners today, a source at Cadwalader says.

The slate, recommended by the management committee, will not be acted on for another few weeks, the source says. Link, reached by phone, confirmed his name was not on the list.

"It really is part of our normal succession," Link says. "It's not something I've been part of planning for."

Link gave up his chairman duties in February to real estate partner W. Christopher White, a longtime ally. Link remained managing partner, running firm operations while White mapped out a new firm strategy.

Link, 54, has been part of the firm's leadership since 1994, when he helped lead an insurgent group of partners to take over management of the firm. Under Link, who rose to become chairman and managing partner of Cadwalader, the firm became heavily focused on securitizations, particularly commercial mortgage backed securities. Profits per partner climbed from $550,000 in 1993 to $2.9 million in 2006.

But as the credit markets started to tighten in fall 2007, the securitization work slowed. Profits per partner fell to $2.7 million in 2007. So far this year, Cadwalader has announced layoffs for 131 associates, bringing its headcount down about 20 percent.

The proposed management slate would appear to suggest the firm wants to de-emphasize its focus on capital markets. Along with Link, Charlotte managing partner Jim Carroll also is MIA on the slate, the Cadwalader source says. In their place, the management committee is recommending partners elect restructuring heads Bruce Zirinsky and Deryck Palmer.

The shake up was first reported by The Lawyer on Monday, though partners were not officially informed of the news until today.

Profits at Cadwalader are expected to be considerably lower for 2008, White confirmed in an interview with The Am Law Daily last Friday, though he wouldn't address by how much. Link would not address the question either when asked about it today.

"It's impossible to predict, but in large part for us it's an irrelevant number, because we have so distorted our profitability picture to position ourselves for 2009 and 2010," White says.

White, who was interviewed before any news emerged about the potential leadership shakeup, notes that the firm will stop paying severance--one of the factors contributing to the anticipated profit drop--to laid off associates in December. White says Cadwalader will enter into 2009 without those expenses and in a better position.

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