Costs are also an issue. Management consultants can manage and mitigate legal risks much cheaper than hourly external consultants. Since in-house counsel traditionally earn a salary with a bonus tied to the company`s performance, not only are the incentives better aligned with those of the holding company, but the compensation is also more manageable than invoices for outside lawyers. It is simply not cost-effective to hire outside lawyers to manage most of the legal risks that holding companies face. Private equity firms are advised to dedicate in-house legal resources dedicated to their portfolio companies, regardless of the size of the investment or the type of company in which the private equity fund is invested. Corporate counsel can manage legal risks identified in due diligence prior to the acquisition and not mitigated prior to the closing of the first transaction. This has the obvious advantage of avoiding that these risks have a negative impact on the future exit of the private equity fund. Blackstone has been busy this year bolstering its legal group, hiring about half a dozen former Big Law employees, according to Bloomberg Law data. Apollo has also made changes to its in-house legal and compliance teams, including hiring Loretta Shaw-Lorello, a former partner at Mintz Levin Private Funds, in February as Managing Director and General Counsel for Fund Formation. “It`s time for compliance training!” – the phrase that fears many hearts. But at Pernod Ricard, General Counsel Ian FitzSimons and his legal team have developed an online training program and a series of videos that could potentially make compliance training fun.
Kathryn King Sudol, a New York-based partner and co-head of mergers and acquisitions, has been appointed General Counsel, succeeding David Sorkin, who will become Chief Legal Officer before becoming an advisory partner at the end of Q1 2023. At that time, Sudol will assume the role of CLO, a statement from KKR added. Over the course of dozens of engagements with private equity firms over the past few years, Spencer Stuart`s legal, compliance and regulatory practice – all former practicing lawyers who have a first-hand understanding of the requirements of today`s legal roles – has helped find strong general counsel to meet the unique needs of portfolio firms. And as private equity continues to expand its influence around the world, these legal advisors will be key players in creating value and delivering the best outcomes for portfolio companies and their private equity owners. Mussafer continued, “Jim`s positive contributions to Advent over the past 11 years are too numerous to list. He has been a key force in Advent`s success and is known within the company and for his partnership, leadership and mentorship. His impact has been felt within the firm far beyond his legal advice and we are grateful that he will be working closely with Amanda over the coming months to ensure a smooth transition. We believe that is beginning to change. As private equity grows — the industry managed $4.1 trillion in assets in 2020, according to Preqin, who estimated it would double to $9 trillion by 2025 — Spencer Stuart`s legal, compliance and regulatory practice has seen a growing demand for general counsel recruitment for holding companies. More and more of our private equity clients are recognising the impact that a general counsel can have on value creation and material risk mitigation in the often fast-paced, dynamic and multifaceted context of portfolio companies. The works council can be particularly advantageous in the context of a complementary acquisition if the risk capital investment benefits from it.
In an acquisition in 2014 alone, HOSTING, a cloud hosting service provider primarily owned by Pamlico Capital, saved more than $200,000 in legal invoices by relying on in-house legal resources instead of hiring outside consultants. When in-house lawyers manage complementary acquisitions, synergistic results are also created. The intervention of the internal advisor allows other members of management to manage other aspects of the transaction or to focus on the day-to-day parts of the business not related to business. The insider perspective of in-house counsel helps make this possible. Morrison, co-head of Ropes & Gray`s private equity practice in Boston, will succeed Advent`s longtime general counsel, James Westra, when he retires later this year. Westra joined Advent in 2011 as a leading attorney after serving as co-head of private equity at Weil, Gotshal & Manges. Private equity giant KKR has hired a partner from its senior legal counsel, Simpson Thacher & Bartlett, as its next general counsel, who will later also assume the role of general counsel. Conventional wisdom dictates that a company hires a management consultant if the turnover exceeds a certain amount (usually $10 to $15 million) or if the number of employees exceeds a certain number (usually 200 to 250 employees), or if the company has an ongoing legal need (for example, if the company operates in a regulated sector, requires the protection of intellectual property or provides a potentially dangerous product or service). Most mid-market private equity investments meet one or more of these criteria, but very few portfolio companies have in-house advice on private equity investments. “Amanda is an outstanding lawyer and private equity executive who brings deep expertise to Advent,” said Julie Jones, president of Ropes & Gray, a private equity trader who took over as head of the firm in 2019. “She is a valued colleague and friend.” Not taking bribery and corruption seriously can be a costly mistake. GC explores the methods used by legal and compliance teams to control enforcement systems.
Heather Zuzenak, a former Goodwin partner, has spent nearly the past decade as Advent`s chief compliance officer. Andrew Dodge, a former Goodwin employee, is deputy general counsel at Advent. If you have multiple sponsors. Holding companies owned by multiple private equity firms are becoming increasingly common and require a general counsel with high emotional intelligence who can juggle different personalities and incentives, in addition to the legal considerations related to dispersing assets. Ms. Morrison comes from Ropes & Gray LLP (“Ropes & Gray”), where she most recently served as Head of the Global Private Equity Group. With over two decades of experience, she is recognized as one of the industry`s leading private equity, corporate and M&A lawyers, advising leading private equity firms and corporate clients on complex transactions across a variety of industries. In addition, she has advised private equity firms and their portfolio companies on various strategic and corporate law matters. Ms. Morrison co-chaired the Ropes & Gray`s Women`s Forum and was a member of the company`s Diversity Committee.
“If growth is the strategy, then you clearly need a general counsel who can play an important role in mergers and acquisitions in the business – to enable the growth story and help the company achieve its business strategy,” said Jay Dubiner, general counsel of Authentic Brands Group. ABG is primarily owned by private equity firms BlackRock, General Atlantic and Leonard Green & Partners. “At ABG, we`ve made a lot of acquisitions since I`ve been here – some big, some small, some relatively simple, but most of them quite complex. Add to that the fact that we are a strong IP company, and the position of General Counsel is an extremely important role here, as it would be in any IP-rich company. Ropes & Gray said in a statement that it expects to continue working with Advent. David Blittner, a former Weil partner who joined Ropes & Gray in 2016, will now become the sole head of the private equity practice. He had shared the role with Morrison. Prior to joining Adams Street, Eric was a member of the Corporate Law Practice Group of Dentons LLP (formerly Sonnenschein Nath & Rosenthal LLP), responsible for various public and private transactions, acted as outsourced general counsel for public and private companies and supported a number of securities transactions. Such situations should encourage private equity firms to recognise the value of dedicated legal resources in their portfolio companies. In-house counsel can provide appropriate risk management in a way – and at a cost – that external legal resources cannot provide. In this way, legal representation can actually improve the value of equity: rather than being a necessary evil, legal advice can be an integral part of a private equity firm`s growth strategy for its portfolio companies. For many managers, however, creating value for their investors leads them to view in-house legal assets as additional costs.
Blackstone Inc. and Apollo Global Management Inc. have appointed new Chief Compliance and Legal Officers for the firms they control, while investment management firms are combining their legal staff. “You have your fiduciary duties to every private equity owner, and when you have these conflicts between investors, it can be hard to navigate,” said Lucinda Treat, general counsel of VICE Media Group, which is owned by various private equity players and private equity firms, each holding minority stakes. “I`ve always tried to look at it that way: `I`m going to see it from their perspective and understand what they want.` Then I`ll determine, “How can I bridge the gap between storytelling and advice to bring everyone together?” Renahan began his career as a partner with a predecessor of Paul Hastings.