Reed Smith has emerged as another Global 100 firm in discussions to take on partners from King & Wood Mallesons‘ European partnership.
The legacy SJ Berwin partnership, which is carrying more than £30m in debt, says it is still in merger talks with interested suitors to take the European arm. However Dentons is no longer part of such discussions with the firm.
It is understood Reed Smith is in talks with several partners about joining the firm, but a partner said talks were early stage and it is not clear how many partners the firm would take on.
Reed Smith European and Middle East partner Tamara Box said: ‘We can expect that when there is legal talent on the market of a high calibre, I would like you to assume that Reed Smith is involved. We are absolutely always looking for great talent.’ She declined to comment further on the talks.
A spokeswoman at KWM said on Tuesday afternoon (13 December) all London office lawyers and staff today received a management update on the future of the practice.
She added: ‘Details of the update are an internal matter and are thus confidential. However, we can confirm that the discussions launched on 9 December with a small number of interested parties continue. We are not able to comment further until those discussions have been concluded.’
It has been a difficult period for the firm since its recapitalisation plan with Barclays was paused in October after a number of key partners left, including high-billing investment funds head Michael Halford and former managing partner Rob Day. The European arm is carrying more than £30m in debt.
Subsequently, KWM’s Asian arm offered to provide the cash required and a guarantee of £11,000 per equity point, in exchange for a 12-month lock-in and a capital contribution of £14m from partners in Europe, including £60,000 from each salaried partner. However, out of 120 partners only 21 agreed, whilst the minimum required for the deal to go through was around 70.
Since, the firm has been assessing its options for a merger or pre-pack administration deal, and last week it said it was holding ‘deeper discussions’ with merger candidates and that it has received ‘a number of offers’.
Other firms Legal Business understands to have been in discussions to take individual partners from the legacy SJ Berwin practice include DLA Piper and Mayer Brown.
Earlier last week, Barclays moved to take extra security over KWM assets with a second debenture, following a string of high-profile departures from the firm.
It emerged former KWM managing partner William Boss was hired by Addleshaw Goddard, alongside property partner Simon Tager and commercial real estate partner Michael Scott.
Meanwhile, KWM’s head of litigation Craig Pollack is in talks to move to US firm Covington & Burling, while heavyweight biller Michael Halford has confirmed his move to Goodwin Procter and former managing partner Rob Day and Andrew Wingfield started their new jobs at Proskauer Rose.
KWM declined to comment.
For more on King & Wood Mallesons, subscribers can read ‘Branded’ for an in-depth look at the firm.