Law firm IPOs still don’t make much sense (but soon could)

Law firm IPOs still don’t make much sense (but soon could)

‘Who would possibly invest in a law firm?’ asks one leader this month, reflecting a common view. Yet the current vogue for floating law firms suggests momentum is indeed building, more than a decade after the introduction of the Legal Services Act. In recent weeks, DWF has turned heads with talk of a £1bn float this year. While the price – not officially attributed to the firm – looks fanciful, even a standard £400m-£600m valuation would be by some way the largest legal float yet seen. The last 12 months have seen a series of offerings, with Knights in June raising £50m and others recently braving the market, including Rosenblatt, Gordon Dadds and Keystone Law. And while larger commercial law firms publicly play down the prospects of raising outside capital, there is no doubt it is now getting more active consideration.

Yet for institutional lawyers, the basic tension in attracting outside shareholders remains. Large law firms generate plenty of capital and have the advantage of an owner/manager structure that closely aligns to the business’ needs and interests. It has never been that clear how the very different incentives of outside investors can be aligned with partners, beyond giving a payout to older partners, a poor outcome for the business as a going concern. Law firms are built on ‘elevator assets’, partners bred to expect huge autonomy make a lousy bet for outside shareholders. Continue reading “Law firm IPOs still don’t make much sense (but soon could)”

The new outlook for City leaders – Casinos hitched with a utility

The new outlook for City leaders – Casinos hitched with a utility

Through much of 2018 the talk has been that major City firms have been extraordinarily busy. GDPR, a rebound in transactional activity as deals put on hold by Brexit are pushed through, a robust showing from the global economy…

And this has translated into… not that much. London’s Big Four Magic Circle firms have packed in closely this year, with revenues up between 4% and 6%. True, in contrast to 2016/17, when currency movements flattered subdued underlying results, this year they have performed modestly better than the headline numbers suggest. But for those whose memories stretch to the 1990s through to 2008, when ‘really busy’ meant routinely sticking 10% to 15% like-for-like on the top line, this remains a very different environment. Continue reading “The new outlook for City leaders – Casinos hitched with a utility”

A new Global 100 elite emerges as the old ones decline

A new Global 100 elite emerges as the old ones decline

In the summer of 2017 the world’s top law firms were looking at their next financial year with scant optimism given a turbulent geopolitical backdrop and uncertain economic headwinds. As it turned out, driven by a robust global economy, bullish investors and a re-born enthusiasm for cross-border transactions, the 2017/18 season proved kinder than forecast, equating to one of the stronger years seen by the Global 100 since the banking crisis recast the industry.

Assisted by consolidation, the 100 drove their collective top line up $6bn to reach $104.4bn. US-centric firms heavy on marquee transactions and private capital made the best showing – it was a relatively subdued 12 months in the vast US disputes market, hitting firms overly exposed to it. Continue reading “A new Global 100 elite emerges as the old ones decline”

Disputes Eye: An English court in Paris – another warning shot

Disputes Eye: An English court in Paris – another warning shot

There is a certain irony to be found in France’s enthusiastic uptake of English courts just as the UK detaches itself from the EU, an irony accompanied by a realistic fear of weakening the English judiciary.

Of course, the introduction of an English-language common law commercial court in Paris is nothing new for the continent, with similar proposals already taking form in Belgium and Germany. However, the Parisians have recently upped their marketing drive, announcing a flat court fee of €100 to contest the Rolls Building’s less-than-competitive entry price of up to £10,000. Continue reading “Disputes Eye: An English court in Paris – another warning shot”

The Last Word: The Big Long

The Last Word: The Big Long

From Trump and Brexit to debt and tech, we ask Global 100 leaders for their assessment of a turbulent 12 months

Trouble ahead

‘Confidence is pretty high, but there are some significant challenges ahead. The growth of tech is going to have a transformational impact, which is going to increase in velocity over the next year or two. At some point we are due for a recession. It is going to happen soon and Trump’s trade war could provoke it.’
Peter Martyr, global chief executive, Norton Rose Fulbright Continue reading “The Last Word: The Big Long”

Growing weary of snake oil dressed as commentary

Growing weary of snake oil dressed as commentary

This may be an issue dominated by all things Millennial, but I am past that, so the column that follows is likely the result of age-induced cynicism. But even by the standards of the legal industry, I find myself increasingly weary of what passes for industry commentary these days.

If an alien beamed down to earth and judged the profession through the lens of what the consultancy and the ‘thought leadership’ industries said about it, what would be the lessons they would take? The law is staffed by incompetent managers. Lawyers are uninterested in technology. General counsel (GCs) are the sole drivers of innovation and progress in the profession. The Big Four accountants are tearing through law. The legal industry faces an imminent structural collapse. I could go on and the purveyors of this certainly do. Continue reading “Growing weary of snake oil dressed as commentary”

Yet unremarked, generational conflict cripples City law

Yet unremarked, generational conflict cripples City law

Our cover feature this month largely speaks for itself in assessing the changing face of partnership as Millennials begin colonising the senior ranks of City law firms. Within five years, this group will be the driving force of elite commercial advisers.

Yet this column is not about the changing attitudes of youngish lawyers, more an issue that touches so many topics in the pages of this magazine, spanning remuneration, strategy, governance and talent. Quite simply, that is the success – and much more often failure – of leading law firms in balancing the interests of their younger ranks with their older partners. Continue reading “Yet unremarked, generational conflict cripples City law”

BCLP: A slightly better sales pitch than expected

BCLP: A slightly better sales pitch than expected

It would take a generous observer of Berwin Leighton Paisner (BLP) to claim the once sure-footed outfit had managed anything better than an indifferent run in the years preceding its union with Bryan Cave. Having dazzled through the 2000s – a period in which the firm seemed to have single-handedly revived the unfashionable notion of a City mid-tier – the last five years have been a stark contrast. Volatile financial performance, a disastrous run of partner recruitment and tension over its property-heavy direction – all in, it was unclear where the firm was going.

As such, confirmation earlier this year that BLP was uniting with a solid US operator, but one whose brand had limited potency in Europe, did not quicken the pulse. Continue reading “BCLP: A slightly better sales pitch than expected”

Disputes Eye: A no-brainer? How tech can save your client £2m

Disputes Eye: A no-brainer? How tech can save your client £2m

With proposed procedural overhauls to disclosure going down like a lead balloon with the Law Society, technology is being touted as the much-needed saviour of time and money.

News in May that Bryan Cave Leighton Paisner (BCLP) declared itself the first firm to win a significant court victory on the back of using document review technology gave hope. Continue reading “Disputes Eye: A no-brainer? How tech can save your client £2m”

Deal View: DLA moves house in London but can it break free?

Deal View: DLA moves house in London but can it break free?

Shifting to an agile-working office is a peculiar experience. Two camps quickly emerge: those excited by change and colleagues happy with decades-old paper in a pile on their desk. It is unsettling, yet can galvanise a workforce.

DLA Piper is similarly moving into a bespoke, semi-open-plan office this year – its single-largest capital investment ever. The flagship London HQ unites 360 lawyers from two separate offices, a grand total of 633 steps down the road. A new environment will be embraced by many, but for some the gloss quickly wears off. Continue reading “Deal View: DLA moves house in London but can it break free?”