The Rise of King & Spalding

King & Spalding was born on January 1st 1885, following a partnership between Alexander King and Jack Spalding. Both self-taught lawyers but neither native to Atlanta, they initially built the firm’s business in the transportation sector. Before the Civil War, Atlanta had a great railway industry, which was destroyed during the War – but when the war was over, the rail industry was booming again, and Alexander King began advising companies on railroad consolidations, receivership, and steamship line development.

The firm has enjoyed an illustrious set of alumni, such as Patrick Calhoun, John D. Little, E. Marvin Underwood, Daniel MacDougald, John A. Sibley, Robert B. Troutman, Pope F. Brock, and Hughes Spalding, son of Jack Spalding and, for a while, leader of the firm.

Alexander King had always been active in politics. One of the most prominent positions he held included serving as Solicitor General in Woodrow Wilson’s administration in 1919 and later on the US First Circuit Court of Appeals. This helped the firm to increase its profile beyond the southeast and bring in clients from the textiles, food, and beverages industries for M&A, contracts, and banking work.

Reputation beyond the southeast

Cut to the 1990s: Atlanta-based conglomerate Coca Cola was retaining King & Spalding on almost all its legal affairs domestically as well as internationally. Companies from outside of Atlanta were also retaining King & Spalding; the firm advised telecoms giant Sprint on negotiating its joint venture with Deutsche Telekom and France Telecom. In Latin America, the firm was representing Jefferson Pilot in Argentina and Home Depot in Chile. Since then the track record of the firm has grown, representing companies in advance complex business interests in more than 160 countries.

With over 1,000 lawyers in 20 offices globally, King & Spalding has been a legal institution and a common point of reference for international clients.

A very high accretion rate of equity

Generating plenty of cash flow through big wins on the litigation, arbitration and investigations side, the firm reinvests the money into corporate work, requiring no debt for lawyers’ bonuses. Such a strategy both facilitates and is compounded by key strategic hires, such as those the firm has made in recent years.

Key strategic hires

In 2018, King & Spalding added 82 partners (including promotions and lateral hires) in 14 out of 20 offices around the world, a record-setting team expansion in the firm’s 133-year history.

Private equity partner Jonathan Melmed was a great hire for the firm, joining from Morrison & Foerster along with partner Enrico Granata. In June 2019, the firm welcomed back Matt Baughman, a former partner who took a year out for a stint as a Justice Department associate deputy attorney general, who rejoined as a partner specializing in government investigations.

In Europe, M&A heavyweight Laurent Bensaid and international arbitration and litigation expert Laurent Jaeger joined the Paris office in 2018, while this year the firm has been making numerous hires in London across a range of practice areas. To keep up with the booming family-office sector, the firm hired Jonathan Ivinson in Geneva to develop the firm’s private wealth practice as well as boosting its corporate, finance and investments capabilities more generally.

The firm is also growing in the Middle East and Asia, hiring Lee Taylor from Clifford Chance in Singapore. Energy and healthcare have been its most recent corporate focus areas; so, to a lesser extent, has technology.

Firm strategy

King & Spalding sees itself as putting strategy front and center for its clients more actively than do other law firms. The firm advises companies on what their shareholders think, and then advises them on how to strategically position themselves. It takes full advantage of the USA’s lack of corporate broker market to act as an intermediary, linking investors to targets as well as doing the legal work.

The firm retains in-house investment bank analysts under a Corporate Monitoring and Preparedness Program to constantly monitor subscription-based publications and stock-trading activity to flag relevant developments for clients. Their extensive analyst training from investment banking backgrounds allows for effective identification of activist activity and trends, so clients can be notified in a timely fashion.

Lead Director Network (LDN)

King & Spalding established the LDN in 2008. The firm partnered with Tapestry Networks to gather a select group of lead directors, presiding directors and non-executive chairmen from many of America’s leading companies to create a dialogue between leaders to improve corporate performance and the roles of the directors of public company boards. The firm took this initiative considering increased scrutiny of public company boards and the need to improve corporate governance.

The LDN’s primary goal is to share corporate governance practices to gain shareholders’ trust and create long-term shareholder engagement. Jim Woolery has been leading the LDN since his arrival at the firm.

In recent years, shareholder activism has been on the rise, with activists involving themselves in major M&A decisions (either pushing for them, or nixing them because they deem the valuation to be inaccurate). King & Spalding increasingly assists boards with responding to activists from a position of strength and improving the relationship between the board and shareholders, in order to enhance long-term shareholder value.

The firm’s activist defense practice is led by Jim Woolery, head of King & Spalding’s M&A and Corporate Governance Practice, who has had an interesting career, to say the least: having taken a lead on strategy at Cravath, Swaine & Moore, he left for J.P. Morgan to head its M&A globally. He then formed a hedge fund with a colleague, raising $500m in the process. Two years ago, he went back into private practice, joining King & Spalding because its strategic goals aligned with his. 

Work Highlight: Prioxy Battle Against Xerox

King & Spalding has advised on multiple high-value matters in the last year. One that stands out is the firm’s remarkable victory in a proxy battle against Xerox. In early 2018, Xerox’s third-largest shareholder, Darwin Deason, along with Xerox’s largest shareholder, Carl Icahn, sought to vote against a proposed $6.1 billion transaction in which Xerox agreed to sell a controlling stake in the company to FujiFilm Holdings, stating that the deal “dramatically undervalues Xerox and disproportionately favors Fuji.” On behalf of Mr. Deason, the King & Spalding filed a suit against Xerox, alleging that the company had proposed a deal that not only did not maximize shareholder value but also resulted from negotiations led by a conflicted CEO. King & Spalding won the case, highlighting the firm’s strength in M&A, corporate governance and litigation.