Good Morning,

Clifford Chance promoted 15 partners across London and the US, tilting its latest round toward American offices as the firm continues building stateside. Client bills are piling up across BigLaw, with receivables outpacing revenue growth and putting pressure on collections. A new survey of nearly 500 GCs found 82% now expect law firms to disclose where AI was used in their work.

On the client side, apartment REITs AvalonBay and Equity Residential are in talks for a $50B merger that would test antitrust limits in high-cost housing markets. Kone agreed to buy TK Elevator for $34.4B in Europe’s largest PE exit. The Fed held rates with its biggest dissent since 1992, crude oil spiked to $126/bbl on Iran tensions, and Big Tech AI capex commitments topped $650B for 2026.

Now, on to what matters for your practice today.

Today’s Talking Points

-Clifford Chance promotes 15 across London and US / GCs demand AI transparency from law firms

-Big Law client bills pile up, stymying revenue gains / Critical mineral projects test firm capacity

-Mayer Brown London crosses $250M / Simpson Thacher and Latham expand to Dallas

-$50B AvalonBay-Equity Residential REIT merger talks / Kone buys TK Elevator for $34.4B / EU overhauls merger rules

-DOJ wins access to KKR’s privileged emails in PE deals probe / Purdue Pharma fined $5.5B

-Fed holds rates with 8-4 dissent, Powell stays on Board / Oil spikes to $126 on Iran deadlock / ECB and BOE hold steady

-Apple, Alphabet, Amazon, Microsoft and Meta report Q1 / Big Tech AI capex tops $650B

Talent Strategy

What today's moves tell us: The latest promotion and hiring cycles show firms investing in US footprint and adjusting partner pipelines as competition for talent stays high.

Clifford Chance promoted nine partners in London and six across US offices, with the US taking a larger share of a slightly reduced overall round. The shift reflects the firm’s continued push to grow its American platform and compete for US-origin mandates.

Across the pond, Weil targeted Freshfields to build its secondaries practice. Keith Chapman, a private funds and secondaries counsel is leaving Freshfields after nearly two decades with the firm.

A growing number of top law school graduates are choosing plaintiff-side firms over traditional BigLaw defense roles, per Bloomberg Law, a trend that could tighten the lateral market further over time.

Operational Strategy

Receivables pressure is rising across BigLaw even as demand stays strong, and firms are planting flags in new growth markets while navigating AI disclosure expectations from clients.

Bloomberg Law reports that Big Law client bills are piling up, with receivables outpacing revenue growth and creating collection headaches. Firms are generating work but converting it to cash is getting harder, a drag on profitability even during busy periods.

Mayer Brown’s London office crossed $250M in revenue, with managing partner Dominic Griffiths pushing back on the idea that London is an outpost: “We are not an outpost.” The office is positioning itself as a core part of the firm’s global platform. Simpson Thacher and Latham are among the firms expanding to Dallas, where partners say building critical mass is the toughest challenge.

A survey of nearly 500 GCs found 82% expect their law firms to disclose where AI has been used in work product, per Legal Business. The findings add pressure on firms to develop clear AI usage policies as clients draw lines on transparency.

Practices

M&A and Capital Markets

The deal pipeline is running hot, with a cluster of mega-transactions spanning real estate, industrials, and private equity.

AvalonBay Communities and Equity Residential – the two largest US apartment REITs – are in talks for a $50B combination that would bring together nearly 200,000 units in high-cost urban markets. The deal raises antitrust questions about landlord concentration in cities like New York, Boston, and San Francisco, especially with housing costs already a dominant political issue heading into US midterms. Kone agreed to buy TK Elevator from Advent and Cinven for $34.4B including debt – Europe’s biggest PE exit ever. EQT is preparing a third improved offer for UK testing firm Intertek after its $11.2B bid was rejected. Lazard bought Campbell Lutyens for $575M to build out private markets advisory. The EU announced its first major M&A policy overhaul in two decades, easing merger rules to help European firms compete with US and Chinese rivals.

PayPal plans to spin off Venmo as a standalone business as buyers circle. SoftBank is preparing a US IPO for its AI robotics venture Roze at a potential $100B valuation. Pershing Square’s combined $5B IPO disappointed, with shares falling 20% on debut.

Private Equity and Investigations

Federal prosecutors won the rare ability to review privileged communications between KKR and its lawyers as part of a criminal investigation into whether the PE firm withheld deal information from antitrust enforcers, per Bloomberg. The ruling is a notable development in DOJ scrutiny of PE deal processes.

Blackstone formed a new AI-focused investment unit called BXN1, folding its growth equity business into the new structure. Growth chief Jon Korngold is departing. Blackstone is also investing $2.3B in European renewables developer Eurowind Energy.

Bankruptcy and Restructuring

Bankrupt Purdue Pharma was fined $5.5B, clearing the path for the firm to dissolve and fund a $7.4B opioid settlement. Two creditor groups approved a $500M government bailout for Spirit Airlines, though a lender group including Citadel is pushing back. CVC is injecting another $250M into Lipton Teas to stave off restructuring – it paid $5.2B for the business from Unilever in 2022.

Where the Work Sits

The $50B AvalonBay-Equity Residential REIT talks will generate high-end M&A, antitrust, and real estate advisory mandates, particularly in markets like New York, Boston, and San Francisco where housing concentration is most acute. The EU’s merger rule overhaul opens a new chapter for cross-border M&A counsel, with firms that have Brussels and transatlantic capability well positioned to advise on the new regime.

The DOJ’s access to KKR’s privileged communications is a signal for PE firms and their outside counsel to review compliance protocols around antitrust filings. Firms with strong white collar and investigations practices will see demand from sponsors looking to shore up deal-disclosure processes. The Purdue Pharma fine and Spirit Airlines bailout fight keep restructuring and mass tort dockets busy.

The $34.4B Kone-TK Elevator deal, EQT’s pursuit of Intertek, and Lazard’s Campbell Lutyens acquisition all point to sustained cross-border M&A and PE advisory demand. The Venmo spinoff, SoftBank’s Roze AI IPO, and Blackstone’s AI unit formation are creating mandates across corporate structuring, capital markets, and technology transactions.

Critical mineral projects are generating new work across energy, regulatory, and project finance practices, per Bloomberg Law. Firms with deep benches in natural resources and government contracts are best positioned as both the US and EU push to secure supply chains.

Global Markets

Central banks across the G7 are holding steady but increasingly split on direction, with oil-driven inflation complicating the rate outlook everywhere.

The Fed held rates at 3.5%-3.75% with an 8-4 vote – the widest split since 1992. Powell committed to staying on the Board of Governors after his chair term ends, a move aimed at signaling Fed independence amid political pressure. Kevin Warsh’s nomination to lead the Fed advanced out of the Senate Banking Committee on a party-line vote. Traders boosted odds of a rate hike by April 2027 to 50%. The US 30-year yield hit 5% for the first time since July, and the 2-year surged 11 bps to 3.95%.

The ECB held at 2% for a third meeting, with Lagarde calling the outlook “highly uncertain” and tied to the duration of the Iran war. The Bank of England kept rates at 3.75% but signaled possible hikes as oil-driven inflation risks build. Japan and the BoJ intervened in FX markets, buying yen in the currency’s biggest single-day move in three years. US Q1 GDP came in at 2.0%, missing the 2.3% estimate, while core PCE hit 3.2% – its highest since November 2023. Crude oil spiked to $126/bbl on Iran war tensions before settling around $105. The IEA warned global oil demand will contract by 80,000 barrels a day in 2026.

That’s the rundown. See you next where law meets the markets.

-The BigLaw Markets Team

*DISCLAIMER: BigLaw Markets analyzes publicly available information, filings, press releases, and news stories published by reputable media sources to deliver newsletters that highlight the drivers of demand for legal services.