Eversheds has been in a Tyco-style sole adviser role with the UK water company since 1 April 2010, with a relationship dating back to October 2007. Under the arrangement, managed by client partner Ian Gray, Eversheds carries out the entire range of plc activity, including regulatory, commercial, competition, employment and property.
Although the company deals primarily with Eversheds, it does farm out some treasury and substantive M&A work to Herbert Smith Freehills (HSF) and in May 2013, the water company turned to HSF to reject a preliminary takeover offer by a Canadian, Kuwaiti and UK consortium, reportedly valued at £5bn.
It is understood that Severn Trent, which has a 12-member in-house team led by group company secretary and general counsel (GC) Bronagh Kennedy, is only looking to tender work currently handled by Eversheds at the moment, keeping the arrangement with HSF in place. It is likely that the company will either select a similar sole adviser mandate, or may alternatively split the work between two firms. At the time of writing, Eversheds did not confirm whether it would be involved in the new tender process.
Speaking to Legal Business, Stuart Kelly, head of legal at Severn Trent, said: ‘The sole provider model has served us well and I can see a world where that continues – with a provider decided by the tender process. A broadly similar commercial model would be the most likely option.’
He added: ‘It’s not only the sole provider arrangement that’s worked. We have a substantial fixed fee structure within that and that has been the centrepiece to the relationship. The problem I have is what we do next and how we remain one of the best in class. We can’t just roll into the next five-year block and expect the same arrangement to perform for us. I’m very keen that this is a properly-run tender process with a fair outcome and clearly defined outputs.’
Eversheds has been successful in obtaining single-supplier mandates and managed to extend its sole adviser role with Tyco last month. The deal saw Tyco EMEA GC David Symonds ask the firm to look at cutting all legal analysis to one-page documents.