Editor: Please describe your practice in both the Texas and New York offices.
Parel: My practice is primarily a private equity practice. I represent private and pension fund sponsors with a particular focus in the middle market. I started my practice in the Dallas office of Weil, worked in our New York office for three years and now live in Dallas again and travel between our Dallas and New York offices. As a result of having a strong national and international platform I have clients throughout North America including in Texas.
Editor: You are also co-chair of Weil’s pro bono committee with Steve Reiss. This committee has been noteworthy for promoting pro bono work in Weil’s offices in the U.S. and abroad. Can you tell me what the role of the pro bono committee is at the firm and what you hope to achieve as co-chair?
Parel: We have a very strong and dedicated pro bono practice at the firm. It’s currently led by Steve Reiss and Miriam Buhl, our in-house pro bono counsel. I’ve been involved with the Pro Bono Committee for a number of years, beginning from the time when I first moved to New York from our Dallas office. The reason for my joining the Committee is the same for my reason for becoming co-chair of the Committee, that is, to pursue pro bono opportunities and involvement for transactional attorneys. My corporate practice is a counterweight to Steve’s litigation practice. Litigators are more obvious participants in pro bono since the majority of pro bono cases lend themselves more naturally to their talents. My goal as co-chair is to show transactional lawyers all the different ways that they can be involved and be comfortable in undertaking new projects that they would not otherwise be exposed to, including some that might be outside of their normal areas of practice. This gives our corporate attorneys the chance to add another dimension to their legal careers, either through teaming up with other members of the Weil family or simply undertaking work on their own.
Editor: How do you get corporate attorneys involved in pro bono?
Parel: We do it in a number of ways. Sometimes we just help them capitalize on skills they already use in their day-to-day practice areas. Training, though, is critical and we always make sure to offer this to attorneys ourselves or to match them with other Weil lawyers who can offer guidance or with one of our outside pro bono partners. We call pro bono hours “our finest hours.” Once folks do get involved, we find that they are largely self-motivated to stay involved.
Editor: What tools do you use for training in addition to having attorneys accompanied by others?
Parel: Training can take many forms - it can be institutional, it can be partnering with others, or it can be situational and relate to a specific mission. On the institutional side, we have a great deal of experience in-house in forming not-for-profits and helping not-for-profits with their business matters. We provide a very comprehensive in-house training program on how to form and service those clients, invoking our corporate as well as our tax areas of expertise. On the partnering side, we rely upon our agent or clearinghouse partners whom we ask to give us instructions as to how to help certain groups, especially in the case of national events. This was the case in our volunteer effort to aid victims of Superstorm Sandy appeal FEMA denials. Finally, we sometimes work with our pro bono partners to provide training for specific missions, such as the Iraqi Refugee Assistance Project, or IRAP, and the List Project.
Editor: Who are the clearinghouse partners of whom you speak?
Parel: Clearinghouses are just as their name implies – nonprofit legal services providers who screen and refer appropriate pro bono matters to assist other nonprofit organizations. In Dallas, we partner primarily with the Dallas Volunteer Attorney Program, but this is by no means exclusive. Part of our ongoing commitment to DVAP is to send one of our junior associates to DVAP each year for a full quarter externship. Outside of Dallas, we partner with Lawyers Alliance for New York, New York Lawyers for the Public Interest, Volunteers of Legal Service, Lawyers' Committee for Civil Rights Under Law, Advocates for International Development, The Global Network for Public Interest Law, The Legal Aid Society, The Innocence Project, and many others.
Editor: Could you tell our readers about the not-for-profit incorporation training program and the Iraqi Refugee Assistance Project you mention?
Parel: Sure. The not-for-profit incorporation training program was borne out of a desire on the part of some of our corporate lawyers to help other corporate lawyers understand that there are pro bono projects that they could do in their comfort zones that could have a real impact, such as helping form not-for-profit 501(c)(3) organizations. We teamed up with the tax lawyers to provide a very comprehensive set of materials as well as yearly training programs to show corporate lawyers, who form companies all the time for clients, how to do this for not-for-profits. We help them navigate the process with the IRS in forming entities that will receive IRS clearance along with showing the not-for-profits how they can receive useful donations that are tax-deductible to the owners.
IRAP and the List Project have helped resettle Iraqi refugees who had worked with the U.S. military and who were being targeted in Iraq as a result of that effort. Our pro bono work requires specific training to learn about the various programs designed to expedite the refugees’ resettlement. We’ve adopted this initiative across all practice lines. We have made a lot of progress, but there continue to be impediments that make it challenging to help our clients to safety.
Editor: Private equity transactions are a big part of your practice. What is the general landscape in the private equity market now? Are you seeing any trends or challenges nationally and/or internationally?
Parel: This is an interesting time for private equity. We are emerging from the third year of a long recession, and we have not yet seen the rebounding that we saw in prior recessions. Nevertheless, private equity is not going away and the current landscape points to all things being ripe for a lot of M&A activity. Corporations and private equity funds are sitting on enormous amounts of cash, there is a lot of debt capacity still in the markets, and the cost of capital is still relatively low. While IPO activity in the U.S. is improving, globally it is down so exits through equity markets remain challenging. In addition, private equity sponsors are accumulating longer holding periods on average on many of their existing investments. The challenge for sponsors seems to be finding the right deals at the right time since there is a lot of dry powder in the system chasing quality assets as they come to market. All signs point to more and more activity, but we are still dealing with a slight supply/demand imbalance and the challenges that come with that.
Editor: What about the private equity market in Texas, particularly the oil and gas market?
Parel: The energy industry has been a bright spot for Texas over the last few years. It has certainly been a big part of what we have seen influencing deal landscape in general given the successes and a continued appetite for investments in the sector. The middle market seems to be strong in Texas as well, and we would expect that to continue.
Editor: You mentioned the fact that there are not that many IPOs, but are you seeing trading among private equity groups?
Parel: In the pre-recession period, we saw many secondary transactions — a lot of companies owned by private equity sponsors being sold to other private equity sponsors. Corporations, with their huge stockpiles of money, are viewing the M&A market very favorably, so it is no longer exclusively a secondary market. Corporations, strategic investors and private equity are all competing for a lot of the same deals, but it is still a challenging market requiring buyers to move quickly and take quite a bit of risk (which not all corporate buyers can do).