It’s fair to say Clifford Chance’s (CC’s) traditionally esteemed private equity team has faced testing times in recent years, as evidenced by the ongoing recruitment of the Magic Circle firm’s quality lawyers by US outfits.
There are reasons to believe that the ship is still unsettled as it’s understood the firm’s global private equity co-head, London-based Jonny Myers, was himself approached by the rapidly growing Gibson Dunn, which recently hired PE heavyweight Charlie Geffen from Ashurst, while other names have come to the fore as considering their options.
But Myers and co-head Frankfurt-based Oliver Felsenstein, are unfazed by such tactics. ‘We are constantly the subject of rumour because we’re number one in private equity and it’s always the leaders who are scrutinised the most’ says Myers.
With its 30C high flying days firmly in the past, the Canary Wharf-headquartered CC has been the subject of considerable scrutiny over widely reported partner exits that brought into question its position as housing a preeminent buyout team. Significant departures of late included one of its biggest billers, David Walker, to Latham & Watkins in 2013. Walker was followed by Tom Evans and Kem Ihenacho only months later, constituting another blow as both were touted as rising stars to watch in the private equity space.
CC, which this year unveiled revenues of £1.36bn, can still boast a deep bench of players within its 50-strong sector group with the likes of partners Spencer Baylin, Nicholas Hughes, up-and-comer Amy Mahon, and David Pearson, while client names on the books include Barclays Bank and private equity houses Permira, Cinven, Clayton Dubilier & Rice, Electra Partners, and, to a lesser extent following certain departures, Carlyle. ‘We have the best private equity practice in the world,’ says Felsenstein. ‘Associates join us because they want to play in the Champions League. And they want to have the best training – even if they decide to leave us, they’ve got the best career opportunities wherever they go.’
Indeed, acclaim for the group saw it shortlisted for private equity team of the year at the Legal Business Awards 2014 after advising Cinven on its parallel acquisitions of Mercury Pharma for £465m, and Amdipharm for £367m, in a buy-and-build strategy aimed at combining the two pharmaceutical businesses. Together the two deals made up one of the largest UK buyouts last year.
Given this performance, Felsenstein is confident that many of his colleagues believe their ambitions are best served at CC, and says: ‘There are always people who are after short term money – our compensation system, which has a long term view, may see people go from time to time – but we must make sure that as a firm we’re bigger than any individual partner could be and not only in revenue terms but also with client relationships. When some partners left – we thought some client relationships would be at risk but clients stayed with us because they want the best advice from the best PE firm. We all get calls from recruiters almost every day – the majority have decided to stay.’