On Monday Kirkland & Ellis confirmed that restructuring rainmaker James "Jamie" Sprayregen would rejoin the firm after a two-and-a-half-year stint at Goldman Sachs.
The return of Sprayregen is a coup for Kirkland. During his 16 previous years at the firm prior to leaving for Goldman in June 2006, Sprayregen represented clients like United Airlines, TWA, Conseco, Chiquita, and W.R. Grace in Chapter 11 proceedings.
At Goldman, Sprayregen, 48, served as managing partner and cohead of the Americas restructuring group, which like other debtor-in-possession financing units has seen its business shrink with the onset of the credit crunch. Like most leading investment banks, Goldman has suffered from billions in writedowns the past few quarters--the company announced in September that it would become a bank holding company.
The Chicago Tribune reports that Sprayregen was not among the 94 employees that Goldman promoted to partner in October. (Sprayregen told the newspaper the partnership slight played no role in his decision to leave, calling the split amicable.)
The Am Law Daily caught up with Sprayregen, who is scheduled to begin work at Kirkland on December 12, to chat about his move, the economy, and Kirkland's possible role in a potential Big Auto bankruptcy.
So Jamie, what made you decide to head back into the law firm realm?
Number one, I really missed the law. Number two, with what's going on in the market and the unavailability of credit, I looked at what my skill set was and what is going to be necessary to help companies. I actually think there's going to be a premium on good, creative, senior-level restructuring lawyering experience. Right now there's not new money solutions for these situations, so solutions are going to have to be with the constituents that are already at the table. I feel pretty well situated wearing my lawyer hat to be pretty helpful to companies in that regard.
Was the only choice Kirkland or did other firms try to recruit you?
There were a number of firms that I won't name that were having the same thought that I just articulated. So I had been receiving some calls. But if I was going to be a lawyer again, I was not really inclined to go somewhere else besides Kirkland.
How long have you known [current Kirkland restructuring chief] Rick Cieri?
Rick and I have known each other for over 20 years. I actually recruited him to Kirkland & Ellis [in 2005]. When he was at [Gibson, Dunn & Crutcher] we were each other's fiercest competitors and best referral services for conflicts matters. And ultimately we got together because we had so many mutual engagements that we just thought it made sense to finally work with one another.
Will you be the cohead of the restructuring and bankruptcy group with Rick?
We don't have specific titles [at Kirkland], but Rick and I will obviously be the senior partners in our group and along with other senior partners we'll run the group together.
A lot of firms have bolstered their ranks--be it Skadden's three-headed practice or Weil bringing back Harvey Miller--to target some of the top restructuring and bankruptcy assignments. How do you plan on keeping up with the competition?
There's certainly a lot of talented lawyers out there and we don't underestimate the quality of the competition, but we think we're positioned very well to compete.
Have any of them reached out to you since you announced you return?
Yes, I've been gratified by reaction of the restructuring community to my move, especially that of some former clients. Thankfully I've actually received a number of calls about some opportunities already. But I always like to have more! [Note: Since Sprayregen's return, Kirkland has already landed one assignment.]
It seems like we're starting to see the long-awaited stream of Chapter 11 filings we've heard were in the offing. What do you see in terms of restructurings and bankruptcy filings into the first few quarters of next year?
I think there's going to be a lot of restructurings, at a minimum, and an increased number of bankruptcies. Because for the last year or so we've seen more of the creditor side of the equation. The money providers--banks, hedge funds, and CDOs were getting in trouble--and we're really just getting to the companies themselves right now. The [economic downturn] has put a lot more pressure on many companies in terms of liquidity and upcoming maturities and covenants.
Speaking of companies, you may have heard that the Big Three automakers have considered filing for Chapter 11. Which one have you guys been advising?
I can't comment on any specific client engagements or opportunities.
Kirkland has represented both Ford and General Motors on other matters, correct?
It's best I stay away from any speculation.
Fair enough. I take it your phone has been ringing though?
Oh yes. I'm open for business and available (laughing).
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