It was February 22 and David Paris of Paris Ackerman was sweating through the last-minute details of his latest deal, the sale of 64 Rent-A-Center stores awaiting final approvals after two years of work.
But his anxiety wasn’t out of typical concern for a client, even though the firm has provided legal services for “hundreds if not thousands” of deals for more than 15 years.
This deal was personal, meaning it came with a large wire transfer of sale proceeds directly to Paris and his law firm partner Mike Ackerman. They are principals in a four-person partnership with Vik Patel and Sanjay Patel, franchisees of three brands now and on the hunt for more.
“It’s surreal. We were able to sell it for what we would call a market multiple, and still achieve a life-changing return for all of us,” Paris said. “From starting out as franchise attorneys, and then to reach this level of success is pretty remarkable. We’re still 45.”
That’s too young to cut back, both as partners in deals “with our friends in the industry,” but also at the firm.
“Maybe at some point in time, we can focus just on clients who are nice to us,” he joked, then quickly changed his wording. “This gives us the benefit of being a little bit more discerning.”
Rebecca Valo of Cassels
Rebecca Valo worked for Canadian law firm Cassels, in Toronto, for years before going in-house as an attorney for Yum Brands.
“My time at Yum was amazing,” she said, but she was “a team of one” there, meaning the only lawyer, and she missed working across different industries, like at a law firm. “They were knocking at my door” at Cassels, and she came back a year-and-a half ago.
Her time at Yum comes in handy in her M&A work at Cassels.
“I think it has allowed me to always keep my eye and mind on what the business goals would be in a given M&A deal,” she said. Outside attorneys might focus more on legal protections for clients, for example.
“When you’re inside, you realize it’s actually about growth and meeting targets and building new units and moving the brand forward in a modern way, and all the things that will come along with a capital infusion,” she said. Keeping that in mind helps her know “what is truly important and what you can let go from time to time.”
Kevin Hein made a big change in September 2020 as the pandemic roared. He was chief development and strategy officer at Alexius, which offered a package of services meant to be affordable for emerging brands. Before that he was a partner at Faegre Baker Daniels in Denver.
“Alexius worked until it didn’t, and it didn’t when clients needed services beyond what we provided,” such as regulatory needs brought on by COVID-19 closures. Akerman came calling, with more than 700 attorneys in 24 U.S. cities, and recruited Hein to co-chair its franchising and licensing team.
Last year Hein and his team advised mega-franchisee Anil Yadav of Yadav Enterprises on its acquisition of Nick the Greek, a San Francisco-based chain with about 40 restaurants at the time.
“I assembled the team, and we staffed it out of probably five or six different offices. When you’re in a big firm, there’s a lot of lawyers with great specialties,” he said.
Yet Akerman’s not among the biggest M&A firms, which “have associates that are almost a thousand dollars an hour. They can’t make the economics work for deals under a hundred million dollars,” he said.
“Most franchise deals aren’t a billion dollars,” he notes, but rather $10- or $20 million or for sure under $250 million. “There is an opportunity for firms like Akerman to come in.”
Amy Cheng of Cheng Cohen
Amy Cheng of Cheng Cohen says her crowning deal last year was NRD Capital’s sale of Fuzzy’s Taco Shop to Dine Brands Global. The deal was rewarding “from a personal perspective, because we helped NRD acquire the company,” in 2016, when Fuzzy’s had 90 units. When Dine bought it had 138 and plans to grow.
“From then on we’ve served as almost an in-house legal team at Fuzzy’s,” and worked “side by side with their in-house executives for all these years,” she said, including founders Mel Knight and Chuck Bush.
“Mel really kept a lot of the culture at Fuzzy’s. I worked with Mel directly very often, and he was an amazing leader, and he looked forward to this transaction and the Fuzzy’s brand to continue on, in good hands.”
Cheng routinely works with clients before and after transactions. “Those are my favorite relationships,” she said. “It’s much more satisfying than if you do the deal and then you say goodbye.”
Sometimes those relationships become very personal. Asked how far she’ll go to close a deal, she said, “My husband will tell you the craziest thing I’ve ever done was while in labor having contractions doing a deal. I said, ‘Hey, once you give me the epidural, I can do it.’ I haven’t been able to top that one yet.”
Her client said he’ll always remember the date their deal closed. Cheng will too—her daughter’s birthday.