How ‘magic circle’ firm Freshfields won big in the US
One ‘magic circle’ firm finally joins New York’s legal elite
Freshfields Bruckhaus Deringer appears to have achieved what was commonly thought to be the impossible: the law firm has become a serious contender in New York despite hailing from the City of London.
The “magic circle” firm has broken into the top 10 of North American firms by value of M&A deals, officially competing head-to-head with US rivals in one of the most lucrative corners of the legal market.
The latest coup emerged just over the weekend: Freshfields is reportedly advising Google on its potential $23bn acquisition of cyber security start-up Wiz. US rivals surely clamoured to advise on the deal.
This comes after Freshfields has already nabbed work on other megadeals that raised eyebrows, such as Johnson & Johnson’s $13bn takeover of Shockwave Medical.
The secret to its success? The law firm hasn’t just poached one-off superstars. Instead, it’s hired almost 50 top partners over the past five years — aka entire teams — from US competitors like Skadden, Davis Polk and Cravath.
Ethan Klingsberg, who was a longtime rainmaker at Cleary Gottlieb, is one great example.
The firm poached six other partners from Cleary alongside Klingsberg (who is very likely the one to thank for the latest Google assignment) so that the team could offer a whole menu of legal advice — not just on deals.
Of course, hiring some of the US’s top talent has been expensive. Industry insiders speculated that Klingsberg secured guaranteed pay of more than $10mn a year.
Freshfields has made the bet that the investment will pay off. While earlier efforts faltered, its latest attempt seems to be working, with revenues at its US corporate practice tripling since 2019.
While there’s a lot for the law firm to celebrate, there are still hurdles ahead.
“When we all come from different places, how do we make sure this is a melting pot of good ideas, not a melting pot of conflict?” said Damien Zoubek, a star M&A lawyer who joined Freshfields from Cravath.
He added that the firm had worked tirelessly to try to achieve “cohesive and common culture” instead.