Legal Business Blogs

Deal view: Eversheds deal team – so much promise but so much steady

Newcomers to London quickly learn the rules of the escalator: stand still on the right or keep moving on the left. The risk with changing your mind is you can land flat on your face.

For Eversheds Sutherland, the consensus view is that its corporate team has stood on the right for years, moving along but hardly dashing. And why not? You still get where you are going.

The obvious answer is that the UK giant a year ago sealed its high-stakes union with US partner Sutherland Asbill & Brennan, the kind of cross-border move that makes law firms bellicose on their M&A ambitions. And after 12 months that corporate and M&A head Richard Moulton describes as very busy, he argues peers are only just catching up to the breadth the practice has achieved over the last five years, claiming it is competing with the likes of Ashurst and Travers Smith for transactional work handled outside the US/London elite. ‘We do large strategic work for clients – we’ve got some good examples – but would we like to have some more of it? Yes.’

Mergermarket statistics show the practice is busy, but reflect a mid-market machine rather than M&A thoroughbred. In 2017, Eversheds is in the top ten for announced European deals, advising on 185 ranked mandates, against 155 in 2016. However, the combined deal value at just $5.83bn compares unfavourably to competitors DLA Piper, CMS and Baker McKenzie.

Recent highlights include: at the end of 2016 advising National Grid, alongside Linklaters, on the £13.8bn sale of a major part of its UK gas distribution business; advising Charter Court Financial Services on its £550m listing on the London Stock Exchange; and acting for Capita on the £888m sale of its asset services arm.

Is the firm again committed to the City deal market after years of tilting toward regionalism and cost control?

Work in the energy, infrastructure and industrial sectors is particularly strong, including acting for BlackRock and Green Investment Group on the £423m acquisition of wind farm operations from Centrica and EIG Global Energy Partners. It also advised the US-based Chemtura Corporation on the German aspects of its €2.4bn takeover by LANXESS and more recently Royal Dutch Shell on its First Utility bid.

All respectable stuff, but you can see why critics maintain its deal team suffers from Eversheds’ generalism and lack of pronounced industry focus. The firm is cagey about breaking down financials by practice group, but says the corporate team has averaged 10% growth in the UK over the last three years.

The team in London has 18 partners, with Moulton wanting to broaden its City bench in capital markets and public M&A. It has made four hires in the past 18 months, though only one in London, with Karim Mahmud from Jones Day, as well as six internal promotions across the UK.

The firm has some credible operators, with Robin Johnson often cited as its top M&A name, while Rob Pitcher is similarly well established. Younger names to watch include Chris Halliday, while Nottingham-based Jon Cox-Brown is also well regarded.

If the evidence of Eversheds’ claimed progress is not yet abundant, the key question is if the firm is again more committed to the City deal market after years of tilting toward regionalism and cost control under former chief executive Bryan Hughes. Hughes’ successor, Lee Ranson, at least talks of a more growth-orientated agenda: ‘We make no secret of the fact we’re continually wanting to move up the food chain.’

We’ll see. Eversheds has sung this tune before and its business model can get by fine with just functional plc coverage. But if Eversheds is truly ever to leap to that left-hand fast track, it is surely now or never.