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While M&A volume has slowed to a crawl during the pandemic, some big firms are still winning high-profile work in this space, appearing on a string of big deals in recent days.

Freshfields Bruckhaus Deringer is one. The U.K. firm, which opened a Silicon Valley office this month as part of its strategy to expand in the U.S., advised Google in its investment in Reliance Jio, India's largest telecom operator, in a $4.5 billion deal announced Wednesday.

Google will own 7.73% of Jio. Freshfields' deal team included Ethan Klingsberg, head of the firm's U.S. M&A practice, and Mena Kaplan, the leader of its tech transactions and commercial IP practice. Jio was advised by India-based AZB & Partners as well as Davis Polk & Wardwell.

This is the first time that Freshfields is advising Google, boding well for the U.K. firm's desire to bulk up its practice in Silicon Valley.

Google was a longtime M&A client of Cleary Gottlieb Steen & Hamilton, an indication that Klingsberg brought over some client relationships to Freshfields. Klingsberg left Cleary last October to join Freshfields shortly before Google announced its purchase of wearable tech company Fitbit. While at Cleary, Klingsberg had also worked on Google's acquisition of Waze, Motorola Mobility and other subsidiaries as well as the restructuring of Google in Alphabet. 

Klingsberg also represented Hewlett Packard Enterprises (HPE) in its $925 million acquisition of wide area network software designer Silver Peak Systems earlier this week. As with Google, this is Freshfield's first engagement with HPE.

Klingsberg declined to comment on the Google and HPE deals.

Freshfields wasn't the only firm to have a solid week. Weil, Gotshal & Manges advised on four big deals that were all announced within 24 hours, including advising SiriusXM in its acquisition of Stitcher; advising Benefytt Technologies in its sale to funds affiliated with Madison Dearborn Partners; and advising Churchill Capital Corp III in its merger with MultiPlan.

But the largest of Weil's four deals was its representation of longtime client Maxim Integrated Products in its $21 billion sale to competitor Analog Devices, the largest U.S.-based M&A deal of 2020 and among the largest in the world this year. 

Latham & Watkins represented Maxim financial adviser JPMorgan Chase & Co., while Wachtell, Lipton, Rosen & Katz was counsel for Analog. 

Rumors have been circulating that another bigger deal is in the mix, as Reuters reported on Thursday that eBay called a board meeting for Friday with the reported goal of selling its classified ads unit for around $10 billion to either online retailer Prosus (and a private equity consortium) or Norwegian classifieds group Adevinta. 

EBay was recently represented by Wachtell and Quinn Emanuel Urquhart & Sullivan in its December 2019 sale of subsidiary StubHub to London-based viagogo. It is unclear if either firm is working on this deal. 

Deal Outlook

While there have been some notable transactions this year, the reality is that 2020 is, so far, a down year in deal value and deal volume. Some are looking for signals that deal activity could turn around in the third and fourth quarters.

And one influence could be politics. Current polling suggests that Democrats could take not just the White House, but the Senate as well, noted Brian Richards, the Chicago-based chairman of Paul Hastings' global private equity practice. And there could be some incentive, he said, to push through some deals in 2020 before a Democratic agenda, which could include changes in the taxing of corporate entities, capital gains and the use of the filibuster, gets set.

Presumptive Democratic presidential candidate Joe Biden has already stated that as part of his plan to pay for health care in the U.S., he would increase the taxation on long-term capital gains (holdings for more than one year) from the high end of 20%, where it currently sits, to 39.6%, which would match the top tax rate for earned income.

Richards believes this, along with Biden's proposed increase in the corporate tax rate from 21% to 28% and the doubling of the tax rate on Global Intangible Low Tax Income (GILTI) earned by foreign subsidiaries of U.S. firms, could lead some entities to push deals through before the possible regime change in January 2021. 

Not everyone agrees. Frank Aquilla, global head of Sullivan & Cromwell's M&A practice, said that while he could see incentives for some businesses to try to squeeze in some deals before the above scenario, he doesn't believe it will be a driving tailwind for the industry. 

"There will be an uptick in business and financial transactions," he said of the political effects on the last half of the year. "But it will not be a driving force."

We'll soon find out. 

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