ATLANTA -- In a move to consolidate its public finance business, Omaha~based law firm Kutak Rock plans to close its Baton Rouge and Los Angeles offices, the firm's head lawyer said late last Thursday.
Kutak's office in Louisiana dates from 1989, when the firm brought on lawyers from Baton Rouge-based Selvidge & Hicks, after Selvidge dissolved. It has grown to include seven lawyers. The Los Angeles office was set up in 1991, and has three lawyers.
Kutak's moves come at a time when both broker dealers and law firms are cutting back on their public finance practices. Through October, bond issuance is down over 44% from the same period the year before.
Industry sources said that since the late 1980s, Kutak has sought to diversify its practice, which had been concentrated in public finance. Recently, the 29-year-old firm has made a special effort to expand its litigation and real-estate law business.
Unlike most of Kutak's other offices, the two scheduled for closure focused primarily on public finance.
"We reviewed our operations and have decided it is in our best long-term interests to discontinue present operations in Baton Rouge and Los Angeles," W. Kimball Griffith, the chairman of Kutak's policy board, said in a telephone interview Thursday.
"This is being done in order to focus more on certain of our major offices," Griffith continued. "Overall, the firm is doing very well, financially and otherwise."
Kutak does not make public its revenue figures.
Griffith said that firm has no plans to close any of its remaining 10 U.S. branch offices. The offices are in Atlanta; Chicago; Denver; Kansas City, Mo.; Little Rock; New York City; Oklahoma City; Phoenix; Pittsburgh; and Washington. The firm's most recently opened branch was Kansas City, launched early this year.
Kutak has not worked out a timetable for closure of the two offices, but will probably do so by yearend, according to Griffith. He said that the firm's future relationship with the lawyers and staff at the two offices "is being worked out." He said the relationship could include joint ventures.
Griffith stressed that lawyers in the two offices will continue to work together with Kutak on current client matters.
Steve E. Hicks, Kutak's senior partner in Baton Rouge, said that the attorneys in the Louisiana office are "looking at all of their options." Options, he said, could include formation of a new firm.
Hicks, who is a member of Kutak's 11-member policy board, said the firm reached its decision in a meeting of the board held Nov. 2.
"Regardless of what Kutak's final plans are," Hicks said, "I expect our working relationship with it to continue."
Lawyers at the firm's Los Angeles office did not return phone calls.
Kutak's public finance practice in Louisiana has been a productive one. In both 1993 and so far in 1994, it has ranked second as bond counsel to issuers in the state, trailing only New Orleans-based Foley & Judell, according to Securities Data Co.
Through October this year, Kutak has served as bond counsel on 13 deals in Louisiana totaling $441 million, for a market share in the state of 37.6%. Foley had 76 deals totaling $798.8, and a market share of 68.1%
Last year, Kulak served as bond counsel on eight deals in the state totaling $935.7, for a market share of 29.1%. Foley's market share was 67.3%, with 124 transactions totaling $2.17 billion.
Louisiana deals accounted for 17.3% of Kutak's national volume of bond counsel work through October of this year. In 1993, the share was almost identical, at 17.5%.
So far in 1994, Kulak has ranked 11th nationally as bond counsel on 140 deals totaling $2.55 billion, for a 1.8% market share. In 1993, Kutak ranked eighth nationwide, with 152 deals totaling $5.35 billion, for a 1.9% market share.
Kutak also served as underwriter's counsel on nine Louisiana deals this year totaling $270.1 million, according to Securities Data. In 1993 it was underwriter's counsel on 24 financings totaling $855 million.
The firm's share of California business has been more modest.
According to Securities Data, Kutak ranked 22d as bond counsel in California with six deals through October 1994, totaling $162.1 million, for a market share of 0.7%. In 1993, the firm served as bond counsel on 15 deals totaling $696 million, ranking it 15th with a market share of 1.8%.
Kutak's California bond counsel business accounted for 6.3% of its national total in 1994, and 13% in 1993.
Kutak's Louisiana clients have included the Louisiana Public Facilities Authority, for which it acted as bond counsel for eight issues totaling $188.3 million this year.
Other clients have included Louisiana State University, the East Baton Rouge Mortgage Finance Authority, the Louisiana Health Care Authority, the Louisiana Maritime Development Authority, the cities of Lafayette and Shreveport, and the Jefferson Parrish Home Mortgage Authority.
Kulak has served in the last year as co-bond counsel, with Foley, on State of Louisiana bond issues.
In California, Kutak's primary clients have been the California Higher Education Loan Authority, and the city of Los Angeles.
Rue Logan, director of the Louisiana State Bond Commission, said the commission is aware of Kutak's plans and will review the contract with the firm as its plans for the Baton Rouge office are finalized.