Olswang has announced that 13 German equity partners, specialising mainly in corporate and finance, will be leaving the firm later this year as it plans to hive off its Berlin office, leaving just a base in Munich.
The firm confirmed the partners will leave ‘by agreement later in the year, along with their colleagues in the Berlin office’ and that it is expecting to suffer a drop in revenues. The firm also said it will now focus on developing its German operations out of its Munich office and announced the hire of corporate partner Robert Heym, who has a focus on technology, life sciences and aerospace, from GvW Graf von Westphalen.
Chief executive Paul Stevens (pictured) said: ‘Given Olswang’s focus on TMT, we have agreed that our Berlin colleagues will continue to seek to grow their practice under a different brand.’
The TMT firm added in a statement there has been ‘agreed an arrangement which will minimise disruption for clients and secure continued employment for all staff’.
Germany managing partner Christian Schede said: ‘This is an amicable separation, reached by mutual agreement, which does not preclude the two sides working together in the future. In Berlin, we will continue to offer a fully integrated corporate and finance practice. Obviously, our plans for the business are still evolving and we will make a further announcement in due course.
Schede added: ‘In the meantime, the decoupling of the Berlin office from the wider firm will take place in a carefully controlled manner over the coming months. During this time, we will be working extremely closely with London to ensure that clients see no interruption to the service that they receive.’
Stevens, who took over as chief executive on a permanent basis in May following the surprise resignation of leader David Stewart last October, said: ‘While these changes will reduce the firm’s revenues in the short-term, we expect no significant effect on our profitability, nor any disruption to the implementation of our strategic plans and longer term sustained growth. The firm will continue to execute on its overall strategy of developing its position as a leading TMT firm, focused on Europe and Asia. In Germany, we will continue to grow our Munich office, which is an important part of this offer. Munich has grown from two fee earners to 18 in less than four years and we are very pleased with both its excellent performance and its future prospects.’
Stewart, who left after rifts emerged with other partners on strategy, upgrading elements of the firm, office expansions and firm spending, recently reappeared in Turks and Caicos as a partner at offshore firm Griffiths & Partners. Since his departure, Olswang has since seen a number of exits from its executive team including general counsel and partnership secretary Simon Callander.
The firm recently reported mixed 2013/14 financial results with profit per equity partner (PEP) down 4%, following a double-digit drop last year, while revenue is up 7% to £117.6m.
Olswang is the latest law firm to shrink its German operations with Orrick, Herrington & Sutcliffe having closed two offices earlier this year while Clifford Chance has seen multiple partner departures after a strategic review carried out by German head Peter Dieners. Last year, Sidley Austin completely closed its German operations as its last remaining partner, Jens Rinze, left for Squire Patton Boggs while Shearman & Sterling closed both its Düsseldorf and Munich offices in 2013
For more on Olswang’s strategy see: Evasive Action – Can Olswang live up to its own ambitions?