Meaninglessness of m&a work Forum

[Anonymous User]

I understand this topic has been discussed here before, but I just wanted to get some fresh insights. It seems like m&a lawyers do not really add any values to a given transaction. By the time a buyer/seller hires a law firm, everything is already decided right? Who cares about due diligence if both parties are willing to sign? Also, bankers nowadays not only determine the purchase price but also come up with potential structures of a deal. So, what is it that we really do here? Are we really just paper pushers? People say we mitigate risks involved in a deal, but what does that even mean? M&A deals are by nature risky and it just seems like mitigating the risks isn’t really important. I’ve heard ppl complaining about the existential meaninglessness of corporate work a few times in law school, but still chose m&a over litigation because I thought the reality would be different.
Admittedly, I am still a junior, but when I see what my partners/senior associates do, that doesn’t really change my perception. Will it get better as I move up or should I gtfo to lit or banking?

[Anonymous User]

+1 Also curious about this. And, as an extension of OP's question, does anyone have any insight into what value is actually created by an "elite" M&A firm like S&C or CSM? Or, for that matter, Wachtell? Put simply, a part of me thinks that companies that hire Wachtell (and similar firms) are getting ripped off lol. The lawyers aren't the ones whispering in the CEO's ear to actually pursue a deal/spin off a unit/etc. Like, should "mere" due diligence really be that expensive? Disclaimer: I'm most likely going into M&A after graduation so I'm 100% grateful that the BigLaw machine will pay for my bills. But, like OP, I just can't get over the fact that we're little more than paper pushers.

[Anonymous User]

Good senior m&a people do help deal with bridging the economic gaps that can and do come up in the diligence and structuring process, which often does involve big ticket issues.

But yes, much of it is papering the deal people already agreed to. Managing the process that gets to the deal (the documentation elements, the governance elements, etc). Managing through the necessary legal processes to close the deal (though a lot of that is done by specialists). Tax people obviously are really important to actually getting the deal to work in a lot of circumstances and the corporate people have to work with them to align what the tax people are saying with the economic deal and the other specialists.

But if you’re looking for something where you’re calling the shots and so on, you’re in the wrong path.

[Anonymous User]

I understand this topic has been discussed here before, but I just wanted to get some fresh insights. It seems like m&a lawyers do not really add any values to a given transaction. By the time a buyer/seller hires a law firm, everything is already decided right? Who cares about due diligence if both parties are willing to sign? Also, bankers nowadays not only determine the purchase price but also come up with potential structures of a deal. So, what is it that we really do here? Are we really just paper pushers? People say we mitigate risks involved in a deal, but what does that even mean? M&A deals are by nature risky and it just seems like mitigating the risks isn’t really important. I’ve heard ppl complaining about the existential meaninglessness of corporate work a few times in law school, but still chose m&a over litigation because I thought the reality would be different.
Admittedly, I am still a junior, but when I see what my partners/senior associates do, that doesn’t really change my perception. Will it get better as I move up or should I gtfo to lit or banking?

The answer is yes.

[Dw686]

I understand this topic has been discussed here before, but I just wanted to get some fresh insights. It seems like m&a lawyers do not really add any values to a given transaction. By the time a buyer/seller hires a law firm, everything is already decided right? Who cares about due diligence if both parties are willing to sign? Also, bankers nowadays not only determine the purchase price but also come up with potential structures of a deal. So, what is it that we really do here? Are we really just paper pushers? People say we mitigate risks involved in a deal, but what does that even mean? M&A deals are by nature risky and it just seems like mitigating the risks isn’t really important. I’ve heard ppl complaining about the existential meaninglessness of corporate work a few times in law school, but still chose m&a over litigation because I thought the reality would be different.
Admittedly, I am still a junior, but when I see what my partners/senior associates do, that doesn’t really change my perception. Will it get better as I move up or should I gtfo to lit or banking?

If you don't think that some day aliens will pull fossilized redlines out of the rubble of Hudson Yards and marvel at the shifting of risk contained in the "commercially reasonable" blueness, you are nuts. What we do is cutting-edge, top tier, intellectual work that will stand not just the test of our time, but also, in future millennia until the heat death of the universe, leave civilizations across the galaxy in awe of our work.

[Anonymous User]

I understand this topic has been discussed here before, but I just wanted to get some fresh insights. It seems like m&a lawyers do not really add any values to a given transaction. By the time a buyer/seller hires a law firm, everything is already decided right? Who cares about due diligence if both parties are willing to sign? Also, bankers nowadays not only determine the purchase price but also come up with potential structures of a deal.So, what is it that we really do here? Are we really just paper pushers? People say we mitigate risks involved in a deal, but what does that even mean? M&A deals are by nature risky and it just seems like mitigating the risks isn’t really important. I’ve heard ppl complaining about the existential meaninglessness of corporate work a few times in law school, but still chose m&a over litigation because I thought the reality would be different.
Admittedly, I am still a junior, but when I see what my partners/senior associates do, that doesn’t really change my perception. Will it get better as I move up or should I gtfo to lit or banking?

bolded is mostly not consistent w/my experience (at one of the firms another poster mentioned as being waste of money)

we are often engaged before bankers, make recommendations on who to hire, negotiate the EL with them. deal structuring (particularly where antitrust issues or divestiture of specific asset(s)) can make/break and bankers little/no involvement or expertise there. major issues sometimes come up in diligence - JVs that are difficult to exit that buyer doesn't want, big lit risk with fat-tail distribution that's tough to quantify, etc

obviously this isn't every deal. sometimes diligence is perfunctory exercise and can get R&W insurance, the MA is vanilla, and the only thing that matters is price

but that's been minority. and would have a lot more sleep/less stress if bankers did everything important and my responsibility was diligence memo no one would read and a form MA/SPA that went through 3 meaningful turns

does my work "matter" in an existential sense, no. is it glamorous, no. does it matter to important people at client, yes unfortunately.

[The Lsat Airbender]

+1 Also curious about this. And, as an extension of OP's question, does anyone have any insight into what value is actually created by an "elite" M&A firm like S&C or CSM? Or, for that matter, Wachtell? Put simply, a part of me thinks that companies that hire Wachtell (and similar firms) are getting ripped off lol.

Nobody thinks that the lawyers are adding more than 1% of value on most deals; 0.1% or less seems more fair as an average. But that value is concentrated in visible risk areas (e.g. having to shitcan the entire deal because you fucked up antitrust clearance; not properly tying down the star CEO of your acquisition target) and/or highly relevant to the decisionmakers (boards want to avoid liability, managers want a fuckhueg payday, nobody wants to get fired sans golden parachute).

More obviously, 1% of an eleven-figure deal is still hundreds of millions of dollars so paying an extra five bars to get a slightly-better law firm seems like a bargain. It's like taking your Lambo to the nice car wash instead of the automatic one behind the gas station; just common sense. Especially if it's not your money anyway.

[Anonymous User]

Can someone share a situation where m&a lawyers actually pulled some weights?

[The Lsat Airbender]

Can someone share a situation where m&a lawyers actually pulled some weights?

Can you define what you mean by "pulled some weights"? Simply papering the deal and submitting the right regulatory filings etc. is pulling weight in a basic economic sense so the answer would be "any big transaction".

[Anonymous User]

Isn’t pubco M&A significantly more cookie cutter anyway? At least that’s what the PE shops say when recruiting but not sure if the elite PE heavy shops (STB/KE) are doing something a bit more meaningful?

[ExpOriental]

Can someone share a situation where m&a lawyers actually pulled some weights?

Peruse some Chancery court opinions and you'll get an idea of the consequences that can arise when deal docs aren't airtight (or conversely, the consequences that can be avoided if they are). I encourage people to actually do this; once you read one of those 100 page tomes of opinions scrutinizing the placement of every comma in a term sheet and every email exchanged between opposing counsel regarding same, you will get a better understanding of why M&A lawyers go through these Kafkaesque processes to make sure nothing slips through the cracks.

People seem to get this idea in their head that because M&A lawyers aren't "dealmakers" or whatever dumb term you want to use, their work isn't important; that the documentation is an afterthought because "all the major terms have already been decided," and the work doesn't really matter.

You may not find it interesting (I am not in M&A, nor would I want to be, it seems terrible to me) but the work is vitally important in the sense that fucking it up can be hugely consequential.

You can liken it to being a plumber or a garbage collector. It's not especially glamorous (laypeople probably think M&A work is glamorous, but we all know better), and I'm sure most don't find it super intellectually fulfilling, but the world becomes a much scarier place if your taps stop working or your trash stops disappearing when you put it out on the curb.

[DougEvans789]

(I’m a litigator.) I don’t know much about M&A, but it’s always seemed stressful to me because, if you screw up, you can hear about it years later when a bazillion dollar lawsuit arises, but if you do a great job, it’s just crickets. Am I right about that? Does that make it less pleasant or nah?

[Anonymous User]

(I’m a litigator.) I don’t know much about M&A, but it’s always seemed stressful to me because, if you screw up, you can hear about it years later when a bazillion dollar lawsuit arises, but if you do a great job, it’s just crickets. Am I right about that? Does that make it less pleasant or nah?

Am in leveraged finance, so not M&A but I feel qualified to answer. I sort of agree, our goal is to ensure that if things go south everything is tied up correctly and our client (my group does mostly lender work) has recourse. I definitely feel that we add value, even when we aren't a big part of the deal negotiation. I'm not a banker, I'm a lawyer.

As to how pleasant that makes it, tbh by the time things explode I doubt anything would be traced to my group, let alone me personally. It's not something I think about. But I agree that no news is good news.

[Hutz_and_Goodman]

“Aliens pulling fossilized redlines out of the rubble of Hudson Yards” is one of the funniest things I’ve read on here

[Definitely Not North]

“Aliens pulling fossilized redlines out of the rubble of Hudson Yards” is one of the funniest things I’ve read on here

[axiomaticapiary]

“Aliens pulling fossilized redlines out of the rubble of Hudson Yards” is one of the funniest things I’ve read on here

Agreed, I am consistently amused by how funny the writing is on this site

[BrowsingTLS]

It's not especially glamorous (laypeople probably think M&A work is glamorous, but we all know better)

Sophisticated viewers of American Psycho know that Patrick Bateman worked in Mergers & Aquisitions. As did David Van Patten and Timothy Bryce. Watch this scene and tell me M&A is not glamorous.

https://www.youtube.com/watch?v=cISYzA36-ZY

Even Paul Allen worked in M&A.

[Sackboy]

KE fucked up some deal (can't remember the details too well) by allowing a company to exit a deal due in the early days of COVID due to COVID being a pandemic when other firms were already removing pandemic (or at least COVID-19) as a valid reason to exit, so that's a sign of how an M&A lawyer can fuck up a deal. Making sure that doesn't happen is carrying your weight. It's insufferable how some individuals here view themselves or other M&A folks as paper pushers. We are lawyers. We mitigate legal risks. That has a value, hence why are are compensated. End of story.

[Anonymous User]

We also....do stuff. Stuff that needs to be done that other people either don't want to or aren't qualified to do. It doesn't all need to be fancy to add value. The spreadsheet monkeys at the IBs aren't doing anything groundbreaking either.

[Anonymous User]

KE fucked up some deal (can't remember the details too well) by allowing a company to exit a deal due in the early days of COVID due to COVID being a pandemic when other firms were already removing pandemic (or at least COVID-19) as a valid reason to exit, so that's a sign of how an M&A lawyer can fuck up a deal. Making sure that doesn't happen is carrying your weight. It's insufferable how some individuals here view themselves or other M&A folks as paper pushers. We are lawyers. We mitigate legal risks. That has a value, hence why are are compensated. End of story.

Are you talking about L Brands/Sycamore? That was one of the early ones (along with Advent/Forescout) that had press.

Think K&E were on the buy side there , and pandemics had been excluded from the MAE definition (maybe before the pandemic had taken off), but the target walked away once Sycamore/K&E kicked up a fuss about closing. Seemed like a lucky save for Rodgers etc.

[Anonymous User]

KE fucked up some deal (can't remember the details too well) by allowing a company to exit a deal due in the early days of COVID due to COVID being a pandemic when other firms were already removing pandemic (or at least COVID-19) as a valid reason to exit, so that's a sign of how an M&A lawyer can fuck up a deal. Making sure that doesn't happen is carrying your weight. It's insufferable how some individuals here view themselves or other M&A folks as paper pushers. We are lawyers. We mitigate legal risks. That has a value, hence why are are compensated. End of story.

Are you talking about L Brands/Sycamore? That was one of the early ones (along with Advent/Forescout) that had press.

Think K&E were on the buy side there , and pandemics had been excluded from the MAE definition (maybe before the pandemic had taken off), but the target walked away once Sycamore/K&E kicked up a fuss about closing. Seemed like a lucky save for Rodgers etc.

It was DPW who fucked up the L Brands situations (and arguably their f-uppers were the litigators who made a money damages claim that may’ve voided the equity commitment letter). Guess that goes to show people really don’t even track which lawyers make mistakes. DPW had a few other public fumbles last year and I’ve seen no sign that it’s affecting their M&A practice.

[gontid]

KE fucked up some deal (can't remember the details too well) by allowing a company to exit a deal due in the early days of COVID due to COVID being a pandemic when other firms were already removing pandemic (or at least COVID-19) as a valid reason to exit, so that's a sign of how an M&A lawyer can fuck up a deal. Making sure that doesn't happen is carrying your weight. It's insufferable how some individuals here view themselves or other M&A folks as paper pushers. We are lawyers. We mitigate legal risks. That has a value, hence why are are compensated. End of story.

Are you talking about L Brands/Sycamore? That was one of the early ones (along with Advent/Forescout) that had press.

Think K&E were on the buy side there , and pandemics had been excluded from the MAE definition (maybe before the pandemic had taken off), but the target walked away once Sycamore/K&E kicked up a fuss about closing. Seemed like a lucky save for Rodgers etc.

It was DPW who fucked up the L Brands situations (and arguably their f-uppers were the litigators who made a money damages claim that may’ve voided the equity commitment letter). Guess that goes to show people really don’t even track which lawyers make mistakes. DPW had a few other public fumbles last year and I’ve seen no sign that it’s affecting their M&A practice.

Are we talking about the same thing? I always thought it was K&E that fucked up.
https://www.nytimes.com/2020/04/29/busi ... virus.html

[Anonymous User]

Honestly, working on M&A deals is not glamorous for the most part, but once you are actually doing it, I think the stress comes from the fact that the consequences (positive or negative) of what you are doing could be quite significant, rather than the opposite. Like, the expectation is any idiot can do things perfectly, which I would argue isn't true in any case, but even if it is, making a mistake could be a very, very big deal.
And there are hundreds or thousands of seemingly minor decisions/compromises made on a deal, any of which could come back to bite you, and the value of lawyers is understanding the degree of risk from each of those choices.

[Anonymous User]

KE fucked up some deal (can't remember the details too well) by allowing a company to exit a deal due in the early days of COVID due to COVID being a pandemic when other firms were already removing pandemic (or at least COVID-19) as a valid reason to exit, so that's a sign of how an M&A lawyer can fuck up a deal. Making sure that doesn't happen is carrying your weight. It's insufferable how some individuals here view themselves or other M&A folks as paper pushers. We are lawyers. We mitigate legal risks. That has a value, hence why are are compensated. End of story.

Are you talking about L Brands/Sycamore? That was one of the early ones (along with Advent/Forescout) that had press.

Think K&E were on the buy side there , and pandemics had been excluded from the MAE definition (maybe before the pandemic had taken off), but the target walked away once Sycamore/K&E kicked up a fuss about closing. Seemed like a lucky save for Rodgers etc.

It was DPW who fucked up the L Brands situations (and arguably their f-uppers were the litigators who made a money damages claim that may’ve voided the equity commitment letter). Guess that goes to show people really don’t even track which lawyers make mistakes. DPW had a few other public fumbles last year and I’ve seen no sign that it’s affecting their M&A practice.

Are we talking about the same thing? I always thought it was K&E that fucked up.
https://www.nytimes.com/2020/04/29/busi ... virus.html

My read too (anon before the K&E booster). Both complaints make for interesting reading; the one from L Brands is fun, I think (https://static.reuters.com/resources/me ... plaint.pdf).

May be useful reading for anyone who queries what M&A lawyers actually do, too.

[Anonymous User]

In the end they just quietly settled/walked away right? So K&E messed up the contract but the client wiggled out of it anyway?