Arnold & Porter's offices in Washington, D.C. Photo: Diego M. Radzinschi/ALM

For anyone whose attention was wandering over the last year or so, there's not much that's outwardly different these days about Arnold & Porter Kaye Scholer, especially now that the firm has returned to marketing itself solely by its Washington, D.C., maiden name, Arnold & Porter.

But there have certainly been changes since Arnold & Porter's merger with the smaller New York-based Kaye Scholer went live at the beginning of last year, not least when it comes to the combined firms' finances.

Annual revenues approached $1 billion in 2017, and the firm is preparing to invest in its offices outside the East Coast corridor between D.C. and New York.

“Generally we're pleased with where we are the first year after the combination,” said firm chairman Richard Alexander. “The combination needs to be measured not after one year, but long term [to] what we're trying to accomplish.”

Arnold & Porter Kaye Scholer recorded $951.5 million in revenue in 2017, about $7 million more than the firms' combined revenues in 2016. Arnold & Porter notched $624 million in revenue in 2016 and Kaye Scholer counted $320 million in 2016, according to ALM data.

The new-look Arnold & Porter enlists 950 total lawyers, who raked in a little more than $1 million per lawyer last year. Profits per partner measured out at almost $1.2 million in 2017. That's up just slightly from 2016 PPP of $1.16 million at premerger Arnold & Porter, and up a nudge farther from the $1.03 million that Kaye Scholer partners took home on average the year before the merger. Arnold & Porter and Kaye Scholer posted RPL of $950,000 and $910,000, respectively, in 2016, so the combined firm saw gains there too.

'SELECTIVE' GROWTH

Alexander said the firm focused primarily on integration in 2017, and that he spent a lot of time getting to know his new colleagues in the past year. In 2018, he said Arnold & Porter would prioritize execution.

As for the recent rebranding, he said the firm had not always planned to revert to the name “Arnold & Porter,” but decided to do so after having internal discussions, receiving external advice, and listening to clients' reaction to the full name.

Post-merger, the firm has placed a heavy focus on its life sciences and transactions practices, Alexander said, helping it beat projections in those areas. He said the life sciences practices of the legacy firms complemented each other well.

Arnold & Porter's transactions work was bolstered by the addition of Ron Levine to its Denver office in 2017. When he joined the firm in February 2017, Levine brought more than 30 years of experience in corporate finance, investment, and mergers and acquisitions for companies in many different industries.

Alexander said he expected the firm might have news to announce about expanded growth in the transactions area in coming weeks, after having been “very selective” about its approach to making lateral hires across the board amid the merger changes last year. He declined to discuss specific hiring plans, other than noting the firm was looking to grow elsewhere than just Washington and New York. 

Three leading antitrust lawyers rejoined Arnold & Porter last year after stints in the federal government. Arnold & Porter added Debbie Feinstein, a former director of the Bureau of Competition for the U.S. Federal Trade Commission, and two attorneys with Justice Department credentials—Bill Baer, former assistant U.S. attorney general for antitrust, and Sonia Pfaffenroth, former deputy assistant attorney general for civil and criminal operations. The three lawyers all rejoined the firm in a two-month span last summer.

Arnold & Porter has already made some splashy hires in 2018, including the additions of former Sen. Chris Dodd, D-Connecticut, and Steve Benz, who was head of litigation for pharmaceutical company Eli Lilly, to its D.C. office.

Looking back at key client engagements last year, Alexander cited his firm's work on behalf of AT&T in its merger talks with Time Warner and said he was “honored that they continue to place their confidence in us.”

Alexander also praised the firm's work on behalf of private equity client American Securities in the sale of SeaStar Solutions for $875 million, and the firm's work on behalf of the Federal Republic of Nigeria last year. Arnold & Porter advised Nigeria on its offering of “diaspora bonds” estimated to be worth $300 million. The firm touted the debt offering from Nigeria as “the first time a sovereign has issued tradeable, registered bonds that are approved for distribution to retail investors in the U.K. and U.S.”

As key policy clashes continue to roil the Trump White House and Congress, Alexander said he expects Arnold & Porter and other firms will play “an increasingly important role” in debates over gun control and immigration this year. Arnold & Porter represents the Brady Center to Prevent Gun Violence, which is a leading advocacy group supporting gun control.