Supported by
GLOBAL LONDON
EVERYTHING TO PLAY FOR The ups and downs of the 50 largest overseas ďŹ rms in London LB223 p21-23 (1) Glob Lond conts21 21
26/3/12 12:31:02
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LB223 p21-23 (1) Glob Lond conts22 22
26/3/12 12:32:35
GLOBAL LONDON
GLOBAL LONDON
Part I: Overview
LONDON BRONCOS Chart Hiring spree: the firms that made the most lateral hires in 2011 Chart Global London total headcount 1998-2011 Chart Partner headcount by practice area Table Revenues of the top ten largest firms by headcount Box Methodology Table Global London top 50
24-31 26 26 26 28 30 32-33
Part 2: Immigration
SITUATIONS VACANT Chart Proportion of international and UK-qualified lawyers
34-39 36
Part 3: Funds
MAJOR FEAST Table Lateral funds partner moves in 2011/12 Table Did your firm expand into any new practice areas in 2011?
40-45 42 44
Part 4: Pockets of excellence
NO STONE UNTURNED Box Which firm will be next to open in London?
46-49 48
April 2012 Legal Business 23
LB223 p21-23 (1) Glob Lond conts23 23
26/3/12 12:32:35
24 Legal Business April 2012
LB223 p24-31 (2) Glob Lon Pt 1.i24 24
Illustration ELLIOT THOBURN
29/3/12 10:36:48
GLOBAL LONDON
While generally international law firms in London have remained static, there have been a handful of US firms that have continued to shine. LB tracks the most aggressive performers in London in the past 12 months BECKY PRITCHARD
LONDON BRONCOS T
here must be a lot of empty desks over at Hunton & Williams’ office in London’s Gherkin. Over the course of a few short weeks in April and May last year the US firm lost virtually its entire transactional team, after a partner exodus saw the 35-strong office dwindle to just 13 lawyers (although insiders say that the number is closer to eight) by the close of 2011. Partners Matthew Williams and John Deacon joined Hogan Lovells’ energy practice, while Paul Tetlow moved to K&L Gates. Martin Thomas and Dearbhla Quigley were picked up by Chadbourne & Parke. It’s a sorry state of affairs for a firm that began with bright hopes in London. The firm launched in the capital in 1999, and in 2004 began an ambitious hiring spree that saw it build up a credible pre-recession AIM team that was one of the busiest in
LB223 p24-31 (2) Glob Lon Pt 1.i25 25
the City at the time. But after a flurry of investment and relocations of US big hitters, all went quiet. Then came the partner exodus. The firm has said that the office will now focus on energy and infrastructure work alongside data privacy. But this year is the first in over a decade that Huntons will not feature in our Global London tables. However, Huntons’ decline in the City is one of only a few bad stories over the past year for Global London firms. For the vast majority of other firms in our survey, things have been less dramatic, with another year of largely flat revenues and flat headcount. LB has been running the Global London survey since 2002 (formerly the US firms in London survey), tracking the fate of the 50 largest international (mainly US) fi rms in London, by analysing headcount, revenues, u promotions and hiring patterns.
29/3/12 10:39:21
GLOBAL LONDON
u
HIRING SPREE: THE FIRMS THAT MADE THE MOST LATERAL HIRES IN 2011 Firm name Weil, Gotshal & Manges
Total lateral hires 2011 10
Edwards Wildman Palmer
9
Reed Smith
9
White & Case
8
Brown Rudnick
7
Jones Day
7
Star recruits Adam Plainer from Jones Day and Stephen Lucas from Linklaters Jon Yorke from Barlow Lyde & Gilbert Tamara Box from Berwin Leighton Paisner and Perry Yam from SJ Berwin Lee Cullinane, Jacqueline Evans and James Dodsworth from Mayer Brown Adrian Harris from Chadbourne & Parke Matthew French from Nomura and Drew Salvest from Hogan Lovells
GLOBAL LONDON TOTAL HEADCOUNT 1998-2011 ,#''' +#))0
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PARTNER HEADCOUNT BY PRACTICE AREA Real estate
Bankruptcy/insolvency Competition
Tax
45
61 49 32
306 Other
472 Corporate/ finance 169 Disputes
'*
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This year we have broken down our analysis into four sections. In this section we take an overview of the market. In section two we take an in-depth look at the split between international and UK-qualified lawyers in London at global firms over the past decade and review some of the changes to immigration laws that have made it difficult to hire international lawyers into London practices. In section three, we focus on one of the few bright spots in the lateral hiring scene of the past year – looking at UK private equity and funds lawyers, who are hot property for US firms, and analysing why these individuals are such a valuable commodity. And in our final section, we look at the hidden gems of the City, the smaller US firms that don’t get the attention they deserve and have developed focused, well-respected and successful practices in London without fanfare.
HEADCOUNT While Huntons may have had a difficult 12 months, for its US and international contemporaries 2011/12 was another broadly flat year. The total number of lawyers at the top 50 international firms in London has increased slightly from 4,182 lawyers last year to 4,271 this year. Over the past four years there has been a slow decline in total lawyer headcount, and there are now 173 fewer lawyers in the City than at the pre-crunch peak of 4,444 lawyers in 2008. Kirkland & Ellis, Greenberg Traurig Maher, Simpson Thacher & Bartlett and Vinson & Elkins all managed to buck the trend, by increasing total London lawyer headcount by more than 20% in the past year. Vinson & Elkins increased its headcount by around 40% from 31 lawyers in 2010/11 to 51 lawyers this year. The firm is focused on energy and natural resources and London managing partner Alexander Msimang believes the firm’s growth is due to the tight specialisation. ‘We are able to focus on what we are best at and we do not need scale for that,’ he says. ‘At the heart is energy and alongside everything that complements that, like projects and telecoms. And that seems to work for us. We compete with the Magic Circle firms of this world in London and if you compare our team, we are every bit as strong as u the larger players.’
26 Legal Business April 2012
LB223 p24-31 (2) Glob Lon Pt 1.i26 26
23/3/12 18:04:00
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LB223 p24-31 (2) Glob Lon Pt 1.i27 27
April 2012 Legal Business 27
23/3/12 18:04:56
GLOBAL LONDON
REVENUES OF THE TOP TEN LARGEST FIRMS BY HEADCOUNT Firm name Baker & McKenzie Latham & Watkins White & Case Mayer Brown Skadden, Arps, Slate, Meagher & Flom Reed Smith Dewey & LeBoeuf Jones Day Sidley Austin K&L Gates
London turnover 2011 (£m) 122.2 119.7 119.1 98 95 94.5 62.5 50 50 33
London turnover 2010 (£m) 120.3 107 118.8 102 87.9 90 64.1 55 49.1 30
u REVENUES
London revenue at the ten largest international fi rms is up 2.5% on last year, from £824.1m in 2010/11 to £844m this year. LB only collects information on the financial performance of the ten largest international fi rms in London, mainly because international firms are increasingly cagey about providing financial information for individual offices, preferring not to attribute income to a specific jurisdiction. Of those ten biggest firms, Skadden, Arps, Slate, Meagher & Flom was one of the strongest performers with revenues up by 8% to £95m, giving the white-shoe firm an impressive revenue per lawyer of £798,000, the highest in our group. Skadden had a strong year in both litigation and M&A, playing a key role advising Roman Abramovich in his $6.5bn dispute with oligarch Boris Berezovsky last year (see LB222, ‘Battle Royale’, page 38). The firm also advised ExxonMobil on its $3.2bn arctic exploration deal with Rosneft in August last year. The biggest international firm in London by both turnover and headcount continues to be Baker & McKenzie, with London office revenues now making up 9% of global turnover, or £122m. This makes it larger in terms of revenues than Wragge & Co, which appears at position 25 in the LB100. Bakers has 385 fee-earners in London, roughly the same size as Olswang. Bakers has an eye fi xed firmly on organic growth and improving profitability. As London managing partner Gary Senior explains: ‘It is preferable to grow through internal promotion [rather than lateral hires] because there is less of a risk of someone not fitting in. There is a sense that we need to be
‘There have been around 90 moves in the London market this year. There is a real appetite for bolt-on team moves.’ Guy Adams, Laurence Simons
% change 2% 12% 0.3% -4% 8% 5% -2% -9% 2% 10%
Ò Ò Ò Ú Ò Ò Ú Ú Ò Ò
Revenue per lawyer £317,000 £557,000 £343,000 £333,000 £798,000 £318,000 £530,000 £317,000 £434,000 £248,000
more profitable and we are seeing incremental change, as each year goes by the perception of us in the market is changing.’ While it has been a steady year for most of the larger firms in London, a select band of smaller, leaner practices have outperformed the market. Quinn Emanuel Urquhart & Sullivan and Proskauer Rose are two of the most obvious examples. Despite only being open since 2008, litigation-only outfit Quinn now has 20 lawyers in London and has office revenues of £21.3m, with an eye-watering 68% profit margin. ‘The thing that makes us stand out in terms of US firms is that our message is simple and clients buy into that specialisation,’ says Richard East, Quinn’s London co-managing partner. ‘London is a market in which simple direct messaging works best. All of the UK firms are struggling to define that message in the current market.’ Proskauer Rose is another fi rm that is staying focused on a few core practice areas in London. The firm opened in the City in 2007 and suffered from unsuccessful merger talks with SJ Berwin. But the failed merger talks don’t seem to have dented the firm’s ambitions, with Proskauer picking up a number of choice hires from SJ Berwin, including funds partners Nigel van Zyl and Oliver Rochman along with six associates last year. The firm is focused on building up in private investment, mezzanine finance and US capital markets and now has 17 fee-earners in London, including five partners. The firm just missed out on making it into the Global London 50 firms but will be one to watch out for next year. ‘The strategy we have is very u
28 Legal Business April 2012
LB223 p24-31 (2) Glob Lon Pt 1.i28 28
27/3/12 15:24:06
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LB223 p24-31 (2) Glob Lon Pt 1.i29 29
ADV/11/932
23/3/12 18:05:00
GLOBAL LONDON
u targeted towards building significant practices in London in areas in which we have a leading position in the US,’ says Allen Fagin, the former chairman of the firm. ‘We’ve had lawyers joining continuously. We are in significant building mode,’ he adds.
PROMOTIONS AND LATERAL HIRES Promotions to partnership are up on last year. On average over the past five years, 64 partners were made up annually compared to 77 new partners this year. Arnold & Porter, which opened in London in 1997 and currently has 38 lawyers in the capital, made up one new partner in the past year. ‘We have promoted a partner for the first time this year,’ says London managing partner Tim Frazer. ‘But looking at organic growth in its pure form? We have not been in town long enough for that.’ Shearman & Sterling also made up more partners than in previous years, promoting four London lawyers to the partnership. ‘Fundamentally the driver for growth is our training programme,’ says London managing partner Nicholas Buckworth. ‘There are firms out there that pile into the lateral market and then hope they can stick it all together. But we’ve spent a huge amount of time and effort building up our training programme and keeping our associates engaged. We are now seeing the fruits of that.’ While the appetite for organic growth may have increased, there is still demand by US firms to splash the cash and invest in partnerlevel hires. Over the course of the past 12 months, Global London firms made 134 lateral partner hires, compared to an average of 85 across each of the past five years.
METHODOLOGY The firms that appear in Global London are the 50 largest non-UK originated firms in London, ranked by headcount. Partner and lawyer numbers were all requested as full-time equivalent averages for 2011. All partner hires are up to and including February 2012. Total lawyer numbers include partners, associates, assistants and trainees but not paralegals. An average exchange rate for the year 1 January 2011 to 31 December 2011 was used for Global London. This was £1 = $1.64036.
‘We compete with the Magic Circle firms of this world in London and we are every bit as strong as the larger players.’ Alexander Msimang, Vinson & Elkins
Two of the most prolific recruiters of the year relative to their size were Brown Rudnick and Edwards Wildman Palmer. Brown Rudnick brought in seven new partners this year – including restructuring and finance partners Adrian Harris and Alper Deniz from Chadbourne & Parke. The firm also took corporate, fi nance, litigation and IP partners from White & Case, Dublin-based McEvoy Partners, Lawrence Graham and Gide Loyrette Nouel. The 29-partner London office of Edwards Wildman Palmer made nine lateral hires this year. It brought in IP, insurance and corporate partners from Bird & Bird, Allen & Overy, CMS Cameron McKenna, Nabarro, Barlow Lyde & Gilbert, Debevoise & Plimpton and Curtis, Mallet-Prevost, Colt & Mosle. Hiring teams of three or more lawyers has become particularly popular. ‘There have been around 90 moves in the London market this year and at least 17 moves were with teams with three or more partners,’ says Guy Adams, head of European private practice at recruiters Laurence Simons. ‘There is a real appetite for bolt-on team moves, particularly in strategic areas.’ In many ways this makes sense – teams are far more likely to bring across clients than single partner hires and they also bring across junior lawyers. ‘To have an impact on the profit and loss, it helps to have full teams with associates, which means the team can become profitable more quickly,’ says Martin Piers, head of Europe, Middle East and Africa legal at recruiter Hudson. ‘It’s very difficult for English firms to do anything about it, whatever the restrictive covenants may say. If a firm can’t service the client’s needs, then they can’t kick up a stink about the client moving.’ But with most firms reluctant to hire aggressively, and headcount and revenues flat, the London market is a long way from the heady days of 2007. London continues to act as a springboard to the rest of the world and international fi rms don’t seem to be planning any major cutbacks in London anytime soon. LB becky.pritchard@legalease.co.uk Legal Business would like to thank AlixPartners for its support of the Global London.
30 Legal Business April 2012
LB223 p24-31 (2) Glob Lon Pt 1.i30 30
27/3/12 15:25:42
GLOBAL LONDON
Superior representation is crucial. Ensure your career is in the hands of a reputable international legal recruitment specialist.
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more than a legal recruiter www.laurencesimons.com
Partners
LB223 p24-31 (2) Glob Lon Pt 1.i31 31
Aprilgroup 2012 on Legal Business 31 Search for the Laurence Simons
23/3/12 18:06:03
GLOBAL LONDON
TOP 50 (1-25) London fee-earners
1
Baker & McKenzie
2
White & Case
3
Reed Smith
4
Mayer Brown
5
Latham & Watkins
6
Jones Day
7
K&L Gates
8
Skadden, Arps, Slate, Meagher & Flom
9
Dewey & LeBoeuf
=10
Promotions
Other qualified lawyers
Partner promotions in latest round
(as % of total London partners)
Change in London lawyer headcount 06-11
385
(5.5%)
80
331
54
2
(3%)
322 to 385
348
(3.9%)
66
310
38
6
(9%)
293 to 348
297
(3%)
103
297
0
4
(4%)
71 to 297
294
(-3.7%)
90
238
56
7
(8%)
241 to 294
215
(10.7%)
53
122
93
4
(8%)
124 to 215
158
(-12.7%)
49
33
125
5
(10%)
170 to 158
133
(3.7%)
61
132
1
1
(2%)
141 to 133
119
(0%)
29
99
20
1
(3%)
115 to 119
118
(0.8%)
33
87
31
0
(0%)
126 to 118
115
(3.5%)
39
96
19
3
(8%)
104 to 115
115
(22.6%)
44
101
14
3
(7%)
52 to 115
114
(4.9%)
25
72
42
4
(16%)
148 to 114
111
(-4.9%)
26
111
0
1
(4%)
108 to 111
99
(5.6%)
19
80
19
1
(5%)
83 to 99
96
(6.3%)
29
93
3
0
(0%)
109 to 96
87
(-5.7%)
18
63
24
0
(0%)
59 to 87
79
(19%)
29
79
0
0
(0%)
0 to 79
73
(26%)
37
26
47
4
(11%)
0 to 73
69
(-20.3%)
28
65
4
0
(0%)
87 to 69
68
(0%)
17
63
5
2
(12%)
54 to 68
66
(10.9%)
18
47
19
0
(0%)
34 to 66
65
(-9.2%)
20
20
45
0
(0%)
56 to 65
54
(22.4%)
12
36
18
2
(17%)
49 to 54
54
(19.6%)
15
52
2
0
(0%)
50 to 54
51
(39.2%)
14
35
16
2
(14%)
19 to 51
400
Partners
300
(% change year on year)
200
Total feeearners
Englishqualified lawyers 100
Global London rank by no. of Firm name lawyers date founded
0
u
Office founded: 1961
Office founded: 1971
Office founded: 2001
Office founded: 1974
Office founded: 1990
Office founded: 1986
Office founded: 2005
Office founded: 1988
Office founded: 1978
Sidley Austin Office founded: 1974
=10
Kirkland & Ellis
12
Shearman & Sterling
13
Weil, Gotshal & Manges
14
Cleary Gottlieb Steen & Hamilton
15
Dechert
Office founded: 1994
Office founded: 1972
Office founded: 1996
Office founded: 1971
Office founded: 1972
16
Debevoise & Plimpton Office founded: 1989
17
Edwards Wildman Palmer Office founded: 2008
18
Fasken Martineau Dumoulin Office founded: 2006
19
Salans Office founded: 1992
20
Orrick, Herrington & Sutcliffe Office founded: 1998
21
Covington & Burling Office founded: 1988
22
Sullivan & Cromwell Office founded: 1972
=23
Simpson Thacher & Bartlett Office founded: 1978
=23
Milbank, Tweed, Hadley & McCloy Office founded: 1979
=25
Vinson & Elkins Office founded: 1971
32 Legal Business April 2012
LB223 p32-33 (3) Glob Lon Main t32 32
28/3/12 12:20:11
GLOBAL LONDON
TOP 50 (26-50) London fee-earners
=25
McGuireWoods
=27
McDermott Will & Emery
=27
Morrison & Foerster
=27
Greenberg Traurig Maher
=27
Paul Hastings
31
Bingham McCutchen
32
Gibson, Dunn & Crutcher
33
Chadbourne & Parke
=34
Gide Loyrette Nouel
=34
Dorsey & Whitney
36
Arnold & Porter
=37
Fried, Frank, Harris, Shriver & Jacobson
=37
Brown Rudnick
=37
Ropes & Gray
40
Wilmer Cutler Pickering Hale and Dorr
(as % of total London partners)
Change in London lawyer headcount 06-11
51
(9.8%)
24
39
12
0
(0%)
0 to 51
48
(-15.7%)
21
47
1
3
(15%)
71 to 48
48
(-10.4%)
16
45
3
0
(0%)
36 to 48
48
(22.4%)
21
48
0
2
(9%)
0 to 48
48
(5.3%)
19
46
2
1
(5%)
25 to 48
47
(7.5%)
17
41
6
5
(30%)
39 to 47
43
(-7%)
17
32
11
1
(6%)
33 to 43
41
(-1.2%)
17
28
13
1
(6%)
39 to 41
40
(-3.8%)
9
31
9
3
(33%)
0 to 40
40
(3.8%)
13
33
7
2
(15%)
41 to 40
38
(2.6%)
17
35
3
1
(6%)
26 to 38
37
(-2.7%)
17
29
8
1
(6%)
43 to 37
37
(24%)
19
33
4
0
(0%)
0 to 37
37
(60%)
15
27
10
0
(0%)
0 to 37
36
(-32%)
12
20
16
0
(0%)
54 to 36
35
(5.7%)
7
0
35
0
(0%)
32 to 35
34
(6.9%)
10
32
2
1
(10%)
24 to 34
30
(-10%)
11
30
0
1
(9%)
16 to 30
30
(-3.3%)
16
26
4
1
(6%)
32 to 30
29
(1.2%)
11
20
9
1
(9%)
25 to 29
27
(n/a)
7
5
22
1
(14%)
29 to 27
25
(12%)
4
0
25
0
(0%)
17 to 25
21
(-8%)
11
18
3
0
(0%)
20 to 21
21
(-4.8%)
4
17
4
0
(0%)
61 to 21
21
(-21.4%)
7
18
3
0
(0%)
50 to 21
200
400
Partners
300
(% change year on year)
Office founded: 1980
Office founded: 2009
Office founded: 1997
Office founded: 1973
Office founded: 1979
Office founded: 1994
Office founded: 2003
Office founded: 1986
Office founded: 1997
Office founded: 1970
Office founded: 1997
Office founded: 2009
Davis Polk & Wardwell Bryan Cave Office founded: 1982
=43
Partner promotions in latest round
Office founded: 1998
Office founded: 1972
42
Promotions
Other qualified lawyers
Office founded: 2009
Office founded: 1972
41
Total feeearners
Englishqualified lawyers 100
Global London rank by no. of Firm name lawyers date founded
0
u
Fulbright & Jaworski Office founded: 1972
=43
Steptoe & Johnson Office founded: 2001
45
Akin Gump Strauss Hauer & Feld Office founded: 1997
46
Faegre Baker Daniels Office founded: 1985
47
Cravath, Swaine & Moore Office founded: 1973
=48
King & Spalding Office founded: 2003
=48
Cadwalader, Wickersham & Taft Office founded: 1997
=48
O’Melveny & Myers Office founded: 1986
April 2012 Legal Business 33
LB223 p32-33 (3) Glob Lon Main t33 33
28/3/12 12:20:12
Immigration laws are forcing international law firms to advertise jobs alongside retail and fast food companies. Despite this, the number of international lawyers in London is falling. Where have all the US-qualified lawyers gone? BECKY PRITCHARD
SITUATIONS
VACANT B
rowsing through the Jobcentre Plus website throws up a few surprises. Alongside minimum wage jobs at McDonald’s and Argos are choice positions at international law firms. Gibson, Dunn & Crutcher is advertising for a contentious antitrust associate, paying £100,000 – the required candidate must have ‘knowledge of global cartel investigations within the financial services sector’. Meanwhile, Wilmer Cutler Pickering Hale and Dorr (WilmerHale) is looking for a litigation associate and is willing to pay £84,000 for the right candidate with an LLM in Latin American law and ‘a solid understanding of and experience in international arbitration’.
34 Legal Business April 2012
LB223 p34-39 (4) Glob Lon Pt 2.i34 34
The adverts sit uncomfortably on a site more suited to jobs on the shop floor than at a global law firm. Advertising on these websites is evidence of the changes to immigration laws over the past few years that require fi rms to jump through bizarre bureaucratic hoops, making it more difficult than ever to bring in internationally qualified lawyers to work in London. But despite all the job ads, our data reveals that the proportion of internationally qualified lawyers working in London is at a ten-year low. Overall lawyer headcount at the top 50 international firms in London rose marginally this year. The number is up by 89 lawyers to 4,271, but down from an all time high of 4,444 lawyers back in 2008, and the number of internationally qualified lawyers is disproportionately low. u
Illustration ELLIOT THOBURN
29/3/12 10:52:23
GLOBAL LONDON
LB223 p34-39 (4) Glob Lon Pt 2.i35 35
29/3/12 10:54:01
GLOBAL LONDON
PROPORTION OF INTERNATIONAL AND UK-QUALIFIED LAWYERS UK-qualified lawyers
US and internationally qualified lawyers
897 656
1,518 3,374
2002
u
Our data reveals that back in 2009, nonUK qualified lawyers (the vast majority are US-qualified) made up 25% (552) of the total lawyers at the ten largest international fi rms in London. By 2011 that had fallen to just 437 (20%) internationally qualified lawyers in total. Over the longer term, that shift away from international lawyers towards UK solicitors has been even more pronounced. Back in 2002, when LB began the Global London survey (then called the ‘US firms in London’ survey), over 30% of the 2,174 lawyers at the firms were US-qualified. By this year that proportion had fallen to just 21% of all lawyers (see chart, ‘Proportion of international and UK-qualified lawyers’, above).
‘We’ve advertised a few roles on Jobcentre Plus and had hundreds of applicants. Most are completely unsuitable.’ HR manager at a major US firm in London
2011
Turbulence in the global economy has undoubtedly had just as much of an impact on those numbers as have the changes to immigration laws. But more importantly, international firms have realised the advantage of having a strong English law practice and that has meant bulking up by hiring English-qualified lawyers while trimming the US-qualified ranks. Davis Polk & Wardwell has operated in London since 1972 and currently has 35 lawyers in its office. However, it wasn’t until this year that the firm announced it was launching an English law practice for the very first time. In January, the firm made a splash with the eye-catching hire of capital markets specialist Simon Witty from Freshfields Bruckhaus Deringer. The firm had been looking for an English lawyer for some time and the opening of an English law office in Brazil expedited the move for Witty. Much of the rationale behind that launch must be that the firm realised it cannot compete on the global stage without English law capability. ‘With the launch of an English law practice in London, we can strengthen our leadership in global securities offerings that we already handle in Europe, Asia and Latin America, and we can expand the services we offer in the UK,’ said Davis Polk managing partner Thomas Reid at the time of Witty’s hire. This recognition of the importance of English law is a long-term trend that can be seen at fellow transatlantic elite firms that have bulked up their UK law offerings over the past decade.
‘The London local market may not be as strong as it was, but it acts as a bridge to the rest of the world.’ Daniel O’Donnell, Dechert In 2002, Simpson Thacher & Bartlett had just one English-qualified lawyer in its 31-strong office. By 2011 the white-shoe firm had 36 English solicitors in its 54-lawyer office. And while Sullivan & Cromwell had just ten English lawyers in its 72-lawyer office in 2002, by 2011 it had 20 English lawyers in its 65-strong office. Of the top 50 international firms in London Cravath, Swaine & Moore is now the only firm with no English law capability. And it is not just Global Elite firms that are cottoning on to the importance of having a critical mass in English law. The recent spate of lateral hires in the funds space, such as a three-partner team that left Clifford Chance for Weil, Gotshal & Manges in June 2011, and the hire of Nigel van Zyl and Oliver Rochman from SJ Berwin by Proskauer Rose in July 2011, is yet further evidence of US firms belatedly bulking up with English-qualified lawyers. (For more in-depth analysis, see feature, ‘Major feast’, u page 40.)
36 Legal Business April 2012
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u
‘The UK is at the centre of much of what is going on in the rest of the world,’ says Daniel O’Donnell, chief executive of Dechert, who points out the importance of having English law capability to service markets in Russia and Asia. ‘I understand the London local market may not be as strong as it was, but the reason we are here is not so much to serve the local market (although we are not going to turn away FTSE 100 clients) but to participate in the market as a bridge to the rest of the world,’ says O’Donnell. But the other factor in the decreasing proportion of US-qualified lawyers at international firms is, anecdotally at least, down to changes in immigration laws. Legislative changes brought in during 2010 mean that firms now have to bring associates and partners who are not from the EU over on the UK Border Agency’s (UKBA) skilled worker or ‘tier 2 visa system’. In order to get a visa for their preferred candidate, firms first have to advertise the job for a month on at least two websites that have been approved by the UKBA. For firms like WilmerHale and Gibson Dunn, that means sticking up a notice on Jobcentre Plus and another more tailored site, such as www.totallylegal.com. ‘We’ve advertised a few roles on Jobcentre Plus and had hundreds of applicants,’ says the HR manager at a major US firm in London.
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‘In general the visa situation has had an impact. It’s put a lot of firms off getting lawyers from abroad.’ James O’Brien, LPA Legal Recruitment
‘Most are completely unsuitable. We advertised for a junior US-qualified lawyer and from over 50 applications only two were suitable. When we say you have to be qualified at the New York Bar, most think they just need to have worked in an actual bar in New York.’ Once firms have jumped through the hoops of advertising on the Jobcentre website, they then have to identify their candidate and start the visa application process, which usually takes a minimum of six to eight weeks. The added bureaucracy and admin seems to have made many firms more cautious about hiring international lawyers. ‘In general the visa situation has had an impact,’ explains James O’Brien, head of private practice at LPA Legal Recruitment. ‘It’s put a lot of firms off getting lawyers from abroad. I’ve had HR managers tell me that the rules have seemed very muddy to them and they didn’t know what was going on, so they don’t want to go through the process of getting visas.’ Vinson & Elkins is another firm that is keen to grow the English law side of its business but has come across visa issues. In 2008, around 40% of the firm’s 23 lawyers in London were internationally qualified, but by 2011 that had fallen to 35% or 16 of its 51 London lawyers. ‘[The visa situation] is more onerous for admin teams, but actually we do not do much relocating of foreign lawyers to London,’ says Alexander Msimang, head of Vinsons’ London office. ‘We want to be a primarily English law practice.’ In April 2010, the government also introduced a cap on the number of skilled workers that could enter the country. While the UK has consistently not met that limit, there is a worry that, once the economy bounces back, the cap could restrict the ability of firms to bring in the international talent they need. While all of this is relatively good news for UK-qualified lawyers, it may mean that there are far fewer US-qualified lawyers in the City over the coming years. But whatever the impact of immigration laws, the biggest driver to the number of US lawyers in London is always going to be client demand. ‘We don’t see it as a split between US and UK-qualified lawyers,’ says Nicholas Buckworth, head of the London office of Shearman & Sterling. ‘We just see it as a demand for services and the primary demand is going to be for English law services. It’s all driven by client demand.’ LB becky.pritchard@legalease.co.uk
27/3/12 12:57:34
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April 2012 Legal Business 39
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With a flurry of US firms luring funds partners from UK rivals, LB finds out why lawyers in this area are hot property JEREMY HODGES
MAJOR
FEAST P
eriodically the City goes through a feeding frenzy of lateral hires. In the past, firms have gobbled up partners in structured finance, restructuring and litigation. The current plat du jour though, is funds. Be they real estate, private equity, hedge, investment or otherwise, firms have recognised the importance of being able to offer the whole funds piece from cradle to grave, with the US fi rms making hay mostly at the expense of the leading UK firms. Since February 2011 there have been 22 City partner hires in the funds space (see table, ‘Lateral funds partner moves in 2011/12’, page
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‘The ability to do the whole funds piece under one roof is the big attraction of a US firm.’ Richard Watkins, Kirkland & Ellis
42). Of that group 14 left UK firms to join US firms, while three went from one US firm to another. It is difficult to pinpoint a similar rate of movement in one area at any time in recent City history. To see talent seep to the US firms at such a fast pace must be gut-wrenching for the established leaders in the UK market, in particular the likes of SJ Berwin and Clifford Chance (CC). In a world where English law has become the dominant force, funds work bucks the trend because much of it falls under US regulations – the recent flurry of investment shows that deep relationships in the US are absolutely crucial to running a successful u global funds practice.
Illustration ELLIOT THOBURN
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u However, the activity of the global and European big players has been in decline since 2007. Global fundraising peaked that year when €485.7bn was raised by private equity houses, according to data provider Preqin. That fell to €201.8bn in 2011. European activity has dropped from €110.2bn in 2006 to €42bn in 2010. There was a slight pick up in 2011 after €44bn in funds were raised. Most of the major private equity players have raised or are expected to raise significant amounts in the next six months but beyond that it is difficult to predict.
LOOKING BACK US firms making a move into the funds space is by no means news. Since around 2003, there have been various interesting plays, particularly as the funds market started to globalise. John Daghlian’s move to O’Melveny & Myers from SJ Berwin in 2004 has seen him carve out a successful mid-market niche acting for the secondary market as well as being a key adviser to fi rms such as Coller Capital. Daghlian explains that, pre-2003, the vast majority of funds were private equity and venture capital with a few infrastructure and fund of funds but not much beyond that. That began to change as funds moved to grow from their domestic markets and expand globally. There was an increase in the number of distressed and illiquid funds. ‘The volume, variety and size of funds changed. The whole market got bigger as it matured,’ he says. Although O’Melveny’s progress was eye-catching, the firm never really capitalised on its initial manoeuvrings as the team has remained roughly the same size. It wasn’t until the triple partner move of Mark Mifsud, Richard Watkins and Justin Dolling from SJ Berwin to Kirkland & Ellis in 2007 that the closely knit funds world sat up and took notice. In fairly short shrift the trio began to see work from SJ Berwin clients Candover, Apax Partners, Mid Europa Partners and Vision Capital. Allied to this was Kirkland’s enviable stock of clients, including Bain Capital, and there was genuine momentum in the US firm’s City funds practice. More recently the team has advised Lion Capital and AMP Capital. The proposition of a platform with deep US relationships was clearly becoming a compelling one.
LATERAL FUNDS PARTNER MOVES IN 2011/12 Name William Yonge Matthew Judd Tim Pearce Ian Meade Noel Ainsworth Jim Baird David Evans Samantha Lake Coghlan Gerard Saviola Stephen Sims James Tinworth Kate Simpson Nigel van Zyl Oliver Rochman Nick Terras Tim Simmonds Peter McGowan Ed Gander Nigel Clark Nick Benson Gray Smith Daniel Greenaway
To Morgan, Lewis & Bockius Ropes & Gray Akin Gump Strauss Hauer & Feld Akin Gump Strauss Hauer & Feld Morgan, Lewis & Bockius SNR Denton Goodwin Procter Goodwin Procter Clifford Chance Skadden, Arps, Slate, Meagher & Flom Stephenson Harwood Proskauer Rose Proskauer Rose Proskauer Rose Brown Rudnick Osborne Clarke (Bristol) Proskauer Rose Weil, Gotshal & Manges Weil, Gotshal & Manges Weil, Gotshal & Manges Mishcon de Reya Pinsent Masons
‘It has become much more important to have the full range of services globally in your private equity offering than ever before. ’ Mike Francies, Weil, Gotshal & Manges
From Proskauer Rose White & Case Simmons & Simmons Simmons & Simmons Simmons & Simmons Dechert Ashurst Ashurst Debevoise & Plimpton Macfarlanes Simmons & Simmons Kirkland & Ellis SJ Berwin SJ Berwin Ashurst Berwin Leighton Paisner Berwin Leighton Paisner Clifford Chance Clifford Chance Clifford Chance Appleby SJ Berwin
Date March 2012 February 2012 February 2012 February 2012 January 2012 December 2011 November 2011 November 2011 October 2011 September 2011 August 2011 July 2011 July 2011 July 2011 June 2011 June 2011 June 2011 June 2011 June 2011 June 2011 May 2011 March 2011
Watkins suggests that when he was at SJ Berwin, around 80% of funds work was outsourced to US firms. Watkins explains: ‘The ability to do the whole funds piece under one roof is the big attraction of a US firm. People who are currently raising funds are having to look further afield for capital – to be able to offer insights on investor developments globally is a real advantage.’ The success of the team at Kirkland still did not precipitate a call to arms by US firms. This was largely because a number of US firms had failed to crystallise their London and European strategies, while SJ Berwin and CC had enough business to hold on to their leading lawyers. However, if there was one move that really started the rush it was that of Jason Glover, who left CC to join Simpson Thacher & Bartlett in mid-2010 (although he didn’t start at the firm until the beginning of 2011). He embodied the quality that CC had spent so long building up and had been the target of multiple approaches by rival firms over a number of years. Since his move he has advised, alongside CC, on the largest post-Lehman fundraising by acting in 2011 for BC Partners on its €4bn fundraising. Glover has also scored roles on subsequent
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multibillion-euro fundraisings for Apax and EQT Funds Management. As one City funds partner says: ‘His move must have caused people to think that “if he can do it, then so can I”.’
WHY NOW? There are three clear reasons to explain the recent movement of funds partners in the market. The first two are intertwined and the most crucial, while the third is perhaps a little more cynical. The regulators have come down particularly hard on the global funds community of late. The regulatory burden that funds now have to bear globally is a huge strain on business, with a large chunk of it driven out of the US. In Europe there have been similar swinging changes to the regulatory landscape. This has polarised the funds community between the large, truly global players and the smaller domestic ones. If a law firm targeting the top end of the market does not have quality people in Asia, Europe and the US, then it is at a distinct disadvantage. Up and coming star Nigel van Zyl, a private equity fund formation expert who moved from SJ Berwin to Proskauer Rose along with Oliver Rochman in July 2011, says: ‘With regulatory and tax being more global and far reaching, the firms that do not have that are at a disadvantage.’ Proskauer Rose has long been in the market for a London funds team and, after a couple of false starts, has followed up with some interesting hires, including the 2009 recruitment of Travers Smith’s investment funds chief Bob Barry. With the highly rated van Zyl now in place, the team at this New York-based firm has recently won solid midmarket mandates for HgCapital and Adams Street Partners. ‘Portable business is much easier than other areas of practice. The number of relationships is far fewer, and they are highly personal relationships that are built up over many years. So they are more likely candidates for movement,’ says former Proskauer chair Allen Fagin. Weil, Gotshal & Manges London office head Mike Francies goes on: ‘It has become much more important to have the full range of services globally in your private equity offering now than ever before. It is harder to do deals without knowing how they
‘US firms have really picked up on fund formation work. Part of that is a natural extension of the client base.’ Maurice Allen, Ropes & Gray
are structured and regulated and US firms certainly have the advantage.’ Francies and his team sealed the landmark hires of three funds partners from CC last year as well as a tax partner. This led to an acrimonious fall out between the two firms with a fair amount of sabre rattling. Ultimately Ed Gander, Nigel Clark and Nick Benson joined the US firm in June 2011, which now boasts a well-rounded offering on the private equity side in the City. The team recently acted for BC Partners in a €6.5bn fundraising and has been instructed on a fundraising for 8 Miles, the Africa-focused private equity house led by Bob Geldof. Linked to this is the fact that the largest global funds invariably have US origins, meaning that investor cash is predominantly American. David Evans, who moved from Ashurst to head up Goodwin Procter’s nascent UK practice in 2011 and specialises in real estate funds, adds: ‘Always follow the money and the reality is a lot of the money flows are US focused.’ ‘They obviously dominate the market and as the houses have become more global with their funds the US firms have followed them and have picked up work. It is still very much a relationship-driven business,’ reckons David Billings, head of Akin Gump Strauss Hauer & Feld’s London investment funds group. Akin Gump has had an investment funds u team in the City for a decade with its
April 2012 Legal Business 43
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u primary focus on hedge funds. The firm recently hired Tim Pearce and Ian Meade from Simmons & Simmons to build a respectablelooking five-partner City funds team. One of the more recent eye-catching moves in London was that of Matthew Judd from White & Case to Ropes & Gray. Judd, a former CC partner, has held relationships with Société Générale and ABN AMRO. ‘US firms have really picked up on fund formation work. Part of that is a natural extension of the client base,’ says Maurice Allen, who co-heads Ropes’ City office. ‘But UK firms have not really gone into the US in the same way, they are not truly global. ‘There are still some standout practices at the UK firms, SJ Berwin and Macfarlanes, for example, but others, such as CC, have suffered something of a blow in the recent hiring spree.’ The last reason for so much movement is that funds lawyers can name their price because this small talent pool is in such high demand. Evans suggests: ‘They recognise they are a small, in demand and liquid group of individuals and they realise that they are at the top of a sellers’ market and they want to cash their chips in.’ However not everyone agrees. James O’Brien, head of private practice at LPA Legal Recruitment, suggests that the moves have been client driven. ‘I don’t think those partners are necessarily being lured by pay packets, rather they are likely going over because it makes sense to be with a firm that represents their clients in the US also,’ he says. The reality is somewhere in between the two. Clients will play a part but a US firm’s ability to put a couple of extra noughts onto a package to lure the right team is well known.
SUSTAINED PUSH US firms are seeing a perfect storm in terms of clients and talent at the moment. However, it would be churlish to think the UK firms are sitting back and taking a hiding. Those worst hit by the hiring are rightly defiant. CC is a global practice with a large funds team and has held onto its key relationships despite the bulk of its London team leaving. Of the largest European fundraisings, the firm has been there in one form or another, including advising on Apax’s €9bn fundraising in August 2011. It also recently
DID YOUR FIRM EXPAND INTO ANY NEW PRACTICE AREAS IN 2011? Yes: Banking and finance Competition Construction and engineering Energy Disputes Financial services regulatory Insolvency and restructuring Investment management IT and telecoms Private funds and private equity Tax White collar No:
13 firms 2 1 1 1 2 1 2 1 2 2 1 3 37 firms
‘Always follow the money and the reality is a lot of the money flows are US focused.’ David Evans, Goodwin Procter
Edwards Wildman Palmer; Paul Hastings King & Spalding Dorsey & Whitney Cadwalader, Wickersham & Taft King & Spalding; McGuireWoods Orrick, Herrington & Sutcliffe Edwards Wildman Palmer; Shearman & Sterling Skadden, Arps, Slate, Meagher & Flom Edwards Wildman Palmer; Gibson, Dunn & Crutcher Paul Hastings; Weil, Gotshal & Manges Edwards Wildman Palmer Arnold & Porter; McGuireWoods; Sullivan & Cromwell
hired counsel Gerard Saviola from Debevoise & Plimpton as a partner. Meanwhile, SJ Berwin is, by some measure, still the number one firm for European funds work. According to Preqin, the firm has closed 13 funds in the last 12 months with a total value of $6.7bn. In fact out of the top five law firms to advise on all European fundraisings in the last 12 months, three have been UK-based practices, with SJ Berwin, CC and Macfarlanes all featuring. Proskauer Rose and O’Melveny were also listed. SJ Berwin’s formidable reputation continues. The firm argues that having more players in the City has only consolidated its position at the top of the market. This latest hiring spree has spread the talent out, which will inevitably make for a much more competitive environment. But as Weil’s Francies points out: ‘That is no bad thing. It keeps us on our toes.’ The greatest change of the past five years is that CC and SJ Berwin are not perhaps as dominant as they used to be, but that doesn’t mean they are impotent forces. They just have more company at the top of the market. The headline-grabbing moves have almost certainly come to an end now and the US firms have to capitalise on investments. One concern is that US fi rms are all selling similar products, leaving UK firms the opportunity to differentiate. The battle for market share is now well and truly on and, with more players fighting for a piece of the global pie, things are just about to get interesting. LB
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26/03/2012 15:05:28
GLOBAL LONDON
LB ventures beyond the established elite to highlight five practices blazing a trail in the City JEREMY HODGES
NO STONE
UNTURNED T
he need to differentiate in the market is paramount. Some firms have always been good at it, while others have struggled and floundered. There is a group of US firms in the City that has now established its strengths. Using the benefit of large US platforms, these firms have, over time, built impressive offerings in the City, be it in IP, energy, regulation or litigation. These pockets of excellence are all over the City and, while the below list is by no means exhaustive or definitive, LB has picked just five from a possible list of 15 that are top performers. Having a smaller, high-quality practice serves as a competitive advantage in itself. These are the less obvious firms that live in the shadow of larger US counterparts.
46 Legal Business April 2012
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■ VINSON & ELKINS London lawyer headcount growth 2004 to 2011: 18 to 51 Speciality: Energy London office: 51 lawyers, including 14 partners Office head: Alexander Msimang Representative London work: ● Advised Tullow Oil on the sale of its Ugandan licences to China National Offshore Oil Corporation (CNOOC) and Total for $2.9bn. ● Advised Statoil on the $3.1bn sale of a 40% share in a Brazilian oilfield to Sinochem. Understated is rarely a term used in the same breath as Texas but Vinson & Elkins is a firm that has quietly built a City presence off the back of being one of the leading global energy firms. Despite having a physical presence in the City since the early 1970s, the firm formed
a multinational practice in 1994 to start practising English law. The real growth has accelerated during the last six years, with the office growing to over 50 lawyers from 18 in 2004. At the firm’s core is an established energy practice. Office head Alexander Msimang, who joined the firm from Denton Hall in 1999, explains: ‘It is quite exciting for an energy lawyer to be right at the heart of a firm’s focus. I might be an energy specialist but I want to do all parts of energy from M&A to financing and project development.’ Vinsons has made some judicious hirings from the likes of Freshfields Bruckhaus Deringer and Dewey & LeBoeuf along the way. The firm has made six lateral hires in the last five years and promoted six associates u to partner in the last five rounds of
Illustration ELLIOT THOBURN
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u promotions, showing a good balance
between organic and lateral growth. ‘We are able to focus on what we are best at and we do not need huge scale in London for that,’ says Msimang. ‘At the heart is energy and alongside are all those complementary areas like projects, infrastructure and telecoms.’ The real success of this firm is that, as a whole, it is far more powerful than any one individual. Although there are a number of leading individuals like Msimang, Mark Coker and Nick Henchie – the collective of the partners appears to be a far more potent force than a prima donna-ish heavyweight.
WHICH FIRM WILL BE NEXT TO OPEN IN LONDON? US firms have been operating in London for over 20 years, and since 2007 Proskauer Rose, Quinn Emanuel Urquhart & Sullivan, Ropes & Gray, Greenberg Traurig Maher and Edwards Wildman Palmer have all opened up. But there are still a few firms that haven’t yet made the leap to London. In this table we review the Global 100 firms that don’t yet have London offices. Who will be next?
■ ARNOLD & PORTER London lawyer headcount growth 2004 to 2011: 32 to 38 Speciality: Regulatory, competition, IP and life sciences London office: 38 lawyers, including 17 partners Office head: Tim Frazer Representative London work: ● Advising News International’s management standards committee on criminal matters relating to the phone-hacking scandal. ● Advised food production group Danisco in a cross-border patent litigation against Novozymes. Every once in a while a firm wins a mandate in the City that makes the market pay attention. Advising on competition aspects of the 2010 merger between Kraft Foods and Cadbury was one such moment for Arnold & Porter’s City office. Although the team’s credentials in top-end competition work are no big secret, to advise the US food giant on its UK competition work when a handful of larger UK firms capable of doing the work were available is a real testament to its practice. Add to the mix competition work for tobacco giant Philip Morris and IPC Media, and Arnold & Porter is a genuine leader in the City. On the global scene few firms can match Arnold & Porter’s pre-eminent IP and life sciences practice. Philip Morris has outsourced the majority of its worldwide trade mark filing and opposition work to the firm. In 2010 it successfully defended Sanofi in the foetal anticonvulsant litigation. The case was discontinued by all claimants in 2011. The firm’s 17 London partners are class operators, with the majority mentioned in the latest edition of The Legal 500 UK, picking up recommendations in ten different practice area
Firm Foley & Lardner Wachtell, Lipton, Rosen & Katz Alston & Bird Holland & Knight Cooley Wilson Sonsini Goodrich & Rosati Perkins Coie Baker & Hostetler Fish & Richardson Jenner & Block Littler Mendelson Patton Boggs Venable
Global revenues 2010/11 $633m $580m
rankings. The firm has achieved a great deal in all these areas but without bowling the market over with growth. The firm has relied on lateral growth after making 11 hires since 2006. The last 12 months have seen the addition of life sciences partner Anna Buscall, who joined from Allen & Overy. She brings with her serious heft on the transactional side. Kathleen Harris, who previously headed the fraud business at the Serious Fraud Office, also joined in 2011. Office head Tim Frazer is pleased with where the firm is in the City but wants more. ‘We are clearly not trying to be everything to all men; we are trying to be a true leader in the regulatory sphere. I understand more the importance of developing a strategy and identifying the right people. We do not like attrition, being small it would be damaging if someone leaves.’
■ AKIN GUMP STRAUSS HAUER & FELD $571.2m $551.7m $517m $493m $477m $386m $383.7m $379m $377.7m $337.5m $337.5m
Source: Legal Business Global 100
London lawyer headcount growth 2004 to 2011: 20 to 29 Speciality: Emerging markets, corporate, energy and telecoms, investment funds, arbitration and tax London office: 29 lawyers, including 11 partners Office head: Steve Blakeley Representative London work: ● Represented LUKOIL on the offering of $1.5bn in convertible bonds and its listing on the London Stock Exchange. ● Acting for Petrobras in a $500m dispute currently before the Commercial Court. It has been described as the ‘world’s largest oil platform dispute’. Cross-border, emerging markets and M&A: the holy trinity of a modern day corporate team. Outside of the elite, few have done as well in these areas as Akin Gump. One need only look to its work for VimpelCom on the 2011 mega-merger with Wind Telecom for which the firm picked up Corporate Team of the Year at the Legal Business Awards. The deal created the sixth-largest mobile telecommunications carrier globally, with net operating revenues of $21.5bn. In addition, the team acted as corporate counsel for Bridas Energy on its sale of 50% of Bridas Corporation to CNOOC for $3.1bn. With a small but potent team, the firm’s credentials are not in question. The 29-lawyer team has had a City presence in investment funds for a decade and this year was boosted by the double partner hire of Tim Pearce and Ian Meade from Simmons & Simmons, marking the firm’s third and fourth
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laterals since 2006. The firm could never be accused of being meteoric in its rise, but its singular and determined desire to be a leader in its core areas without having huge teams of lawyers has marked out the firm’s progress in recent years. ‘We want to reflect what the firm is good at but only where we can see a clear rationale strategically and for the client,’ says office head Steve Blakeley. The quality of recent deals has made it easier for the team to sell its City story and Blakeley is a man who knows the legal industry inside and out, having overseen the merger between Denton Hall and Wilde Sapte in 2000 and filled a number of management positions. ‘We are now seeing more quality on the market than we ever have before. Some firms think they need an office everywhere but we don’t see that as a long-term sustainable business,’ says Blakeley. ‘It is imperative that we are not diverted from our strategy by trying to pursue superficial objectives.’ Akin Gump is currently going through one of those blue patches that firms have once in a generation. The team will hope to capitalise on that to attract the sort of lawyers it needs to make the next step of its evolution a success.
■ BINGHAM MCCUTCHEN London lawyer headcount growth 2004 to 2011: 27 to 47 Speciality: Finance, restructuring and litigation London office: 47 lawyers, including 17 partners Office head: James Roome Representative London work: ● Advising the ad hoc committee of bondholders of Petroplus, a Swiss oil refinery group, following insolvency filings in multiple European jurisdictions. Total outstanding bond debt of $1.75bn. ● Representing holders of more than $23bn in bonds issued by three major Icelandic commercial banks: Glitnir, Landsbanki and Kaupthing. Bingham has stormed through the recession in the City. This culminated in 2011 when the firm’s London office posted $49.1m in fees, equating to revenue per lawyer of $1.2m. What stands the firm apart from other finance outfits in the City is the specialist knowledge that it provides to a mainly financial institutions client base.
From last year’s $1.3bn restructuring of the Quinn Group to Gala Coral’s and Wind Hellas’ own restructuring, the firm is the go-to outfit for bondholders, mezzanine lenders and noteholders looking for a result. Office head James Roome admits the firm didn’t necessarily get it right on a couple of occasions but feels the London office is now pretty complete. Initial hires into the finance practice were more transactional and it was quickly realised that the firm’s clients didn’t want that capability, rather they needed an advisory practice. The hire of former Simmons & Simmons managing partner Mark Dawkins last year into its financial litigation group is symptomatic of a firm that’s stock is at an all time high. Not afraid to pay for the right people, newly qualified lawyers can expect to earn £100,000 upon qualification. ‘We have sought to grow our London office deliberately over a number of years. As a largely advisory practice, it is all about the quality of the individual lawyers we have brought in,’ explains Roome. He says: ‘We have a reasonably tight focus in London, acting mostly for financial institution clients who are looking for specialist knowledge and advice rather than a full-service practice.’
■ COVINGTON & BURLING London lawyer headcount growth 2004 to 2011: 53 to 66 Speciality: IP/IT, life sciences (transactional and regulatory), and litigation (fraud and arbitration)
London office: 66 lawyers, including 18 partners Office head: Roger Enock Representative London work: ● Acted for Vernalis, a life sciences company, on its recent £68.5m fundraising. ● Representing Ryanair in proceedings before the Court of Appeal against the Office of Fair Trading and Aer Lingus, concerning the Office of Fair Trading’s investigation of the competition implications of Ryanair’s shareholding in Aer Lingus. Since the launch of its last global strategic review in 2008, aptly called Project 2012, Covington’s City practice has stopped at little to achieve its goals. The review set out growing its pre-eminent life sciences and regulatory team in London as well as technology and media as important steps. Hires from competitors such as Herbert Smith and Debevoise & Plimpton have been strategically targeted and are beginning to pay off. This year the firm hired six partners, bringing total lateral hires since 2006 to 11. The highlight of this spree was the hire of a highly regarded life sciences corporate team from Morrison & Foerster, which included Paul Claydon, Natalie Diep, James Gubbins and James Halstead. Additionally litigation partner Casey Cooper joined its white-collar crime team from Baker Botts in February. Louise Nash, deputy managing partner of the London office, says: ‘What we are seeing now are the fruits of the 2008 strategy. We achieved significant European and other international growth and our 2016 plan calls for continuing that growth, especially in London, Europe, Asia and the Middle East.’ An impressive roster of clients includes Microsoft, Merck Pharmaceuticals, Samsung Electronics and Giorgio Armani. The team advised Axis-Shield on its £235m all-cash public takeover offer from Alere. The standout deal of 2011 was the London office’s role advising, as part of a larger cross-border team, Microsoft on its $8.5bn takeover of Skype. The large mandate really brought its core expertise to the fore. ‘It kept our attention focused on the strategic goals, the big picture,’ reckons Nash. ‘It became easy for us to stay on course during a time when many other firms panicked.’ LB
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