As part of the 2023 New York Legal Awards, partner David Klein was recognized by the New York Law Journal in the "Dealmaker of the Year" category and was profiled in a Q&A.
What were some of your most satisfying successes of the past year, and why? The recent sale of Oak Street Health (OSH) to CVS is one highlight. It demonstrates that even in a challenging M&A environment, buyers are willing to pay significant premiums for unique assets that can provide immediate scale, especially in consolidating industries. The incredible team at OSH had a vision of bringing affordable healthcare to underserved communities. They executed it to perfection, which culminated in a sale to CVS for $10.6 billion.
Another highlight has been working with clients to find creative ways to plug the lack of available financing. Whether by structuring deals to ensure portability of existing debt, or navigating equity rollovers by existing stockholders, there are no easy deals in this market, and their highly bespoke nature makes for a very rewarding process. A prime example is our representation of Vista on its acquisition of Citrix Systems for $16.5 billion (together with Elliott), and the simultaneous combination of Citrix with Vista’s portfolio company TIBCO, creating one of the world’s largest software providers.
What qualities make a great dealmaker? Knowing when to sound the alarm bell is key but knowing when not to is equally important. There are hundreds of issues in any transaction and being able to isolate the issues that really matter, and devising workable solutions is a hallmark of a great dealmaker. Every client has different objectives and risk tolerances—understanding those intricacies is core to the job.
What recent market factors have been the most challenging in your practice area? A well-functioning debt financing market is critical to LBOs. In the last year, traditional banks stopped lending and alternative financing options were significantly more expensive. As a result, many deals that would have been completed in a normal environment didn’t get done.
The uncertain regulatory landscape also affected the M&A slowdown, especially for larger scale transformative deals. The current U.S. regime is the most aggressive in decades, and clients are understandably concerned about being caught in the regulators’ crosshairs. Providing advice to clients that is sensitive to the regulatory climate without being overly conservative is key to helping them decide what deals are actionable. We have had tremendous success helping clients navigate those pitfalls.
A prospective client calls and asks why you or your team should be retained. What is your response? We approach the law from a commercial and pragmatic perspective. We also invest deeply in our clients, taking the time to understand their needs and goals. We believe in building longstanding relationships with our clients, and the breadth of the Kirkland platform (with top tier practitioners across disciplines) enables us to provide a fully integrated offering that is unmatched in the marketplace.