The Score

January 31, 2012 7:02 PM

The Am Law 100, the Early Numbers: Revenue Up, Profits Down Slightly at Cadwalader

Posted by Amy Kolz

Cadwalader, Wickersham & Taft enjoyed a modest uptick in revenue in 2011, the firm's first burst of topline growth since 2007, according to The American Lawyer's reporting. The firm's gross revenue increased 4.4 percent to $448.5 million and revenue per lawyer was up nearly 8 percent to $965,000, according to The American Lawyer's reporting.

"The pickup was pretty much across the board, but litigation was particularly strong" says Cadwalader chairman W. Christopher White. In fact, White says, litigation represented approximately 40 to 42 percent of the firm's revenue, with specialities ranging from Foreign Corrupt Practices Act work to securities litigation to financial services and antitrust performing particularly well. For example, 2011 saw Cadwalader continue its long-running representation of monoline insurer MBIA in connection with claims brought against the FDIC over the IndyMac Bank collapse. And since bringing on former Linklaters competition partner Alec Burnside in April, the firm has been advising Deutsche Börse on its proposed $9.7 billion merger with NYSE Euronext.

Cadwalader's transactional practices, including M&A and private equity, saw a "steady pickup" in the first half of the year, White says, although those areas faltered in the third quarter. In April the firm represented pharmaceutical giant Pfizer in the $2.38 billion sale of its Capsugel division to private equity firm Kohlberg Kravis Roberts & Co.  And though commercial mortgage–backed securities issuance was a shadow of its former self last year, Cadwalader dominated the market, serving as issuer's counsel on 16 of the 20 transactions brought to market in 2011's first half, according to Commercial Mortgage Alert

The firm's revenue growth notwithstanding—and despite a 5 percent decline in the firm's equity partner ranks—profits per equity partner declined slightly last year, from $2.39 million in 2010 to $2.375. White attributes the dip to the firm's "significant investments in people and infrastructure."  

Last January, the firm acquired a nine-partner energy and commodities team from McDermott Will & Emery, including McDermott's former cohead of global M&A, Karen Dewis, and the former head of the firm's energy and commodities advisory practice, Paul Pantano, Jr. Cadwalader opened an office in Houston with the acquisition of the McDermott energy team and an office in Brussels with the addition of former Linklaters's partner Burnside. 

The firm also grew in Asia, says White, bolstered its Hong Kong outpost with the addition of structured finance partner Jeffrey Chen from Mayer Brown JSM in August and continued to build out its office space in both that city and Beijing. Cadwalader also increased its spending on recruiting and training, increasing its aggregate dollars spent on training and recruiting by 65 percent and 28 percent, respectively, over the past two years, White says.

Cadwalader has suffered several noteworthy losses of late. In September famed M&A partner Dennis Block jumped to Greenberg Traurig. And in January, the firm lost a trio of bankruptcy partners, including financial restructuring cochair Deryck Palmer, to Pillsbury Winthrop Shaw PIttman.

Nonetheless, White is sanguine about the future: "We feel we had a reasonably good year in 2011, and are looking forward to a better year in 2012."

This report is part of The Am Law Daily's ongoing Web coverage of 2011 financial results of The Am Law 100/200. Results are preliminary. Final rankings and full results for The Am Law 100 will be published in The American Lawyer's May 2012 issue and on The Am Law Second Hundred will be published in the June issue.


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