Legal Business

Dwindling partner promotions at A&O and Freshfields fail to maintain current partnership levels

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The UK’s elite law firms often point to their rigorous partnership promotion process as a natural selector of the best talent but at Freshfields Bruckhaus Deringer and Allen & Overy (A&O) the promotion of just 15 and 16 partners respectively in recent weeks is insufficient even to maintain the partnerships at their current levels.

For Freshfields, the latest promotions round is a marginal increase on the 14 promoted in 2013, but is a significant decline when compared with the 20 partners promoted in 2011 and 2012.

Legal Business

A&O duo at risk of SRA investigation after criticism of Dahdaleh conduct

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Two senior litigators from Allen & Overy (A&O) face the possibility of an investigation by the Solicitors Regulation Authority (SRA) following allegations of misconduct during a high profile fraud case.

A hearing on Wednesday (26 March) at Southwark Crown Court revealed that the Magic Circle firm had referred itself to the SRA due to a controversial meeting attended last year by two of its partners, David Esseks and Peter Watson.

The lawyers attended the meeting with their client Victor Dahdaleh, a Canadian businessman facing trial for his alleged involvement in bribes to secure contracts in Bahrain. Dahdaleh and the two partners had met a witness for the prosecution ahead of a first trial, which was aborted.

Following criticism of the meeting and allegations that the A&O lawyers had put pressure on the prosecution witness, the firm was replaced by Norton Rose Fulbright as counsel to Dahdaleh. A second trial saw Dahdaleh acquitted in December.

At the latest hearing on Wednesday, Judge Nicholas Loraine-Smith said that partners Esseks and Watson will not be referred to the UK Attorney General for a potential contempt of court proceeding but that he may raise the matter with the SRA. During the hearing, A&O’s counsel Alex Cameron QC conceded the meeting was ‘extraordinarily ill-advised’.

A&O said in a statement: ‘We welcome Judge Loraine-Smith’s decision not to refer the matter to the Attorney General, following counsel’s representations in Southwark Crown Court yesterday. We are ready to co-operate with the SRA and believe there were good grounds to justify the action that was taken at the time.’

An SRA spokesperson said: ‘We are aware that the judge will be making a referral and, now that proceedings have concluded, we will consider the referral and act accordingly. The firm has kept us advised of this matter.’

Any further action would likely be complicated as Esseks is a US lawyer, while veteran civil litigator Watson retired from the firm last year.

Whatever the outcome, the case will be regarded as embarrassing for the City giant at a time when most UK advisers are seeking to demonstrate their capability in handling white-collar crime work.

This week’s hearing is the latest twist in a saga that has seen criticism of the Serious Fraud Office (SFO) for overly relying on Akin Gump Strauss Hauer & Feld, which was representing prosecuting party Aluminium Bahrain (Alba) in the US in relation to the bribery claims.

Jaishree.kalia@legalease.co.uk

Legal Business

A&O bolsters corporate practice as PE star follows Lloyd from Ashurst

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He was singled out as one of Ashurst’s rainmakers of the future but private equity specialist Karan Dinamani has become the second high-profile corporate exit to Allen & Overy (A&O) in six months.

Dinamani (pictured) joins Ashurst’s former global head of corporate, commercial and competition Stephen Lloyd, who resigned within weeks of the firm fully integrating with Australian partner Blake Dawson and post-merger management elections. Lloyd joined A&O as co-head of its private equity practice in November.

Dinamani featured in our look last year at the likely rainmakers of 2020, ‘Great bright hopes‘, where Lloyd, who was still at Ashurst at the time, described him as ‘amazing and a complete star of the future’.

In his new role, Dinamani will form part of the Magic Circle’s global private equity group with a focus on private equity transactions from buyouts, sponsor exits and portfolio restructurings to fund establishment, and secondaries to infrastructure private equity.

He was made partner at Ashurst in May 2013 and specialises in cross border M&A and corporate finance transactions, with a particular focus on advising private equity houses. He joins with experience of working on high profile deals for clients including Apax, Nordic Capital and Terra Firma.

A&O London corporate managing partner Richard Browne said: ‘This appointment further strengthens our unified private equity (PE) offering spanning the corporate and finance practices. It comes at a time of increased levels of activity in the sector. Recently, increasing confidence in the markets has triggered a rise in PE-backed IPOs which we expect to continue.’

A spokesperson at Ashurst added: ‘KD [Dinamani] is a talented junior partner who has a good future ahead of him. We will be sorry to see him go but wish him the best of luck.’

Jaishree.kalia@legalease.co.uk

Legal Business

RBS share sell-off in Direct Line gifts Allen & Overy with £1bn deal

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Just under a year earlier than expected by some in the City, Royal Bank of Scotland (RBS) this week (26 February) announced the sell-off of the majority of its remaining stake in Direct Line, gifting Allen & Overy (A&O) with a further bite of the cherry in a deal anticipated to be worth over £1bn.

A&O led by corporate partner David Broadley was first instructed on RBS’ float of 34.72% of Direct Line in the autumn of 2012, after the 80% nationalised bank was forced to offload the major insurer under EU regulations on state aid.

The beleaguered high street bank sold off a further tranche to investors last March for £507m, with this latest sale of the majority of its outstanding shares coming in the same week as RBS announced a loss in excess of £8bn, as chief executive Ross McEwan also announced plans to reduce the bank’s costs by £5bn by 2017.

On the IPO Broadley led a multi-disciplinary A&O team alongside senior RBS advisers, general counsel corporate/M&A Rushad Abadan and legal counsel Scott Gibson. The team worked opposite Slaughter and May for Direct Line, led by M&A partners Jeff Twentyman, Andy Ryde and Robert Chaplin. Direct Line was also advised by its in-house team led by general counsel and company secretary Humphrey Tomlinson.

However, Slaughter and May said it will have no role on the forthcoming £1bn straight forward sell-off of RBS shares, which are largely expected to go to institutional investors.

The role is a significant repeat instruction for A&O, which is on RBS’ 21-strong panel, unveiled in July 2013 and including Clifford Chance, Freshfields Bruckhaus Deringer and Linklaters as well as many of the larger City and transatlantic firms such as Eversheds, Hogan Lovells and Norton Rose Fulbright. RBS often turns to Linklaters for its major corporate mandates, including the sale of a 20% stake in WorldPay to private equity firms Advent International and Bain Capital late last year.

The sell-off of Direct Line comes as the insurance company reported a 70% increase in pre-tax profits on Wednesday.

Under European Union competition rules, imposed after the £45bn taxpayer bailout of RBS, it must sell its entire holding by the end of this year.

david.stevenson@legalease.co.uk

Legal Business

European expansion – A&O launches in Barcelona with hire of Freshfields partner

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Allen & Overy (A&O) has pointed to the growth and profitability of its Madrid office and the recovery of the Spanish economy for its decision to launch in Barcelona, with the hire of local corporate partner Antoni Valverde from rival firm Freshfields Bruckhaus Deringer, announced today (4 February).

Valverde, who made partner at Freshfields in 1997 and became co-head of the firm’s private M&A group from 2001 to 2009 and the leader of the Spanish corporate group from 2007 to 2010, focuses on private M&A and has acted for some of the key Spanish players on outbound M&A, including acting for Barcelona-based infrastructure operator Abertis on the €1.5bn acquisition of OHL Brazil in August 2012.

Valverde’s hire comes following a period of growth for the Magic Circle firm’s Madrid office over the past six years, including opening a litigation department with the appointment of Clifford Chance (CC) partner Antonio Vázquez-Guillén in 2008; hiring Antonio Martinez from Uria Menendez as a partner and head of the antitrust practice in 2009; and taking on Pablo Mayor also from CC to the corporate group in 2010 to further expand A&O’s public law offering.

Recent deals for the Spanish office include advising on Iberdrola’s sale of its 50% stake in British nuclear consortium NuGen to Japan’s Toshiba and on the €2bn equity investment made by Qatar Holding; as well as Bridgepoint Capital on the acquisition of a portfolio of wind energy assets from listed Spanish construction company ACS.

A&O’s Madrid managing partner Andrew Clark told Legal Business that the new office will be integrated with the firm’s existing office in Madrid and managed as one practice, with an aim to grow headcount across both offices in the next two years. The Madrid office currently has ten partners across its finance, corporate, litigation and tax offering.

The launch comes as recent figures suggest that M&A activity in Spain is picking up both in volume and value, with A&O’s own M&A index last month stating: ‘Excluding deals in the financial sector, driven by the restructuring of the Spanish banking system, the number of deals still increased by 24% in 2013 while deal value was up by over 50%.’ Firms including Magic Circle rivals CC and Freshfields Bruckhaus Deringer have an office in Barcelona.

A&O global managing partner Wim Dejonghe said: ‘Spain’s economy grew at its fastest pace in almost six years in the final quarter of 2013 and this is reflected in the success and profitability of our Madrid office. Today’s news underlines the belief that there is a significant opportunity for us to further expand in Spain.’

Iñigo Gómez-Jordana, senior partner of A&O Spain added: ‘Spain’s latest M&A figures point towards recovery and new opportunities lie ahead for both our Madrid and Barcelona offices for all our practice areas. We look forward to Toni’s contribution, which will further strengthen our Spanish and international corporate offering, a strategic priority for the firm.’

jaishree.kalia@legalease.co.uk

Legal Business

Senior hires: KPMG appoints DLA partner as Manchester legal head as A&O and NRF lose partners to HogLove and Vedder Price

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As KPMG looks to expand its legal services practice the Big Four accountant has hired DLA Piper corporate partner Nick Roome to head its legal services arm in Manchester in what it says is the first of a series of hires planned over the course of this year.

Roome, who has broad corporate, private equity and commercial legal expertise with a focus on the north of England and international markets, qualified with Addleshaws in 2000 before moving to DLA Piper’s Manchester office in 2005. He will start his new role in the late Spring.

KPMG’s legal services practice is a well-established part of KPMG’s wider UK tax practice and has worked with the tax team nationwide for a number of years. The Manchester legal services team currently includes a four-strong tax litigation team, which has been in place for over ten years. In addition, KPMG has a team of advisers on corporate and employment law who help provide multi-disciplinary tax services to clients where required.

Commenting on his appointment, Roome said: ‘I am very excited to be making the move from a law firm to an accounting firm with such a diverse and varied portfolio of clients and projects. KPMG already has a well-established legal services practice and I look forward to helping it grow and develop further in the North.’

Roome is the first of around four or five legal appointments expected in KPMG’s Manchester legal services team.

His hire comes shortly after Legal Business reported in September that KPMG is considering its options under the Legal Services Act (LSA) to convert to an alternative business structure (ABS) in a bid to expand its legal services capability.

EY also said at the time that it had the position ‘under review’ and PwC is understood to be considering its position. Deloitte was the only one of the Big Four accountants to deny any plans to set up an ABS.

Meanwhile, in the City, current global head of aviation at Norton Rose Fulbright, Neil Poland, becomes the latest partner to leave the firm as he joins Chicago-headquartered Vedder Price’s global transportation finance practice in London next month.

Poland, who is rated as ‘top class’ by the Legal 500, acts on behalf of financial institutions on capital markets financings, as well as bank syndicates on the financing of European locomotives and leading passenger rolling stock operating companies (ROSCOs).

Key clients for the Norton Rose aviation team include easyJet, Emirates, Flybe, Malaysian Airline Systems Berhad, Air Tanker Services, Amentum Capital, and Orix Aviation Systems.

‘We are thrilled to have Neil join us,’ said executive committee vice chair and chair of the firm’s global transportation finance team Dean Gerber. ‘Neil has extensive experience in the aviation and rail industry on a global-scale that will deepen Vedder Price’s practice and strengthen our growing London office.’

Prior to joining Norton Rose, Poland worked for the London offices of Magic Circle firms Slaughter and May and Clifford Chance.

Other high-profile departures from Norton Rose in recent months include Michael Grenfell, who joined the senior leadership team at the newly created Competition and Markets Authority last November.

November also saw longstanding antitrust partner Mark Jones leave for Hogan Lovells followed in the same month by energy partner and former head of nuclear services Fiona Reilly, who left for PricewaterhouseCoopers (PwC) to become a director in the nuclear energy team to develop the global energy practice.

In other high profile moves, former Allen & Overy (A&O) corporate partner Don McGown is to join Hogan Lovells corporate practice in early February.

McGown, who has been with A&O since 1990, has acted for a number of high profile clients including 21st Century Fox on the US$10 billion spin-off of its publishing and print businesses, and DS Smith on its US$2 billion reverse acquisition of SCA Packaging.

He primarily advises on international M&A and corporate restructuring and has significant sector expertise in telecommunications and media, and financial services.

Commenting on McGown’s arrival Andrew Skipper, global co-head of Hogan Lovells’ corporate practice, said: ‘Continuing to strengthen our excellent London corporate practice is important for us and Don’s arrival will bring additional high quality board level experience and international perspective to our London team.

‘Don is a highly effective and skilled practitioner with the right skillset, market standing and collegiate approach. He is the perfect fit for our corporate practice with its global spread, in-depth industry knowledge and expertise in highly regulated sectors.’

francesca.fanshawe@legalease.co.uk

Legal Business

Deal Watch: CC, Freshfields and A&O act on Liberty Global’s €6.9bn acquisition as Dentons and LG float Hurricane

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Three Magic Circle firms have scored lead advisory roles on Liberty Global’s €6.9bn acquisition of Netherlands’ largest cable operator Ziggo, with Freshfields Bruckhaus Deringer, Clifford Chance (CC) and Allen & Overy (A&O) all acting on the deal.

A&O’s Amsterdam-based corporate partner Annelies van der Pauw led for Liberty Global and competition partner Paul Glazener worked on the antitrust aspects, as the joint entity will have around 90% of the regulated Dutch fixed line cable market, while CC’s finance partner Mark Huddlestone headed up the team to advising the lenders.

Longstanding Liberty Global adviser Ropes & Gray led on financial aspects for the company in London, with partners Tania Bedi and Jane Rogers advising alongside the firm’s London co-managing partner Maurice Allen.

The firm has also previously represented the international cable company on the financing of its €3.1bn acquisition of Germany’s third largest cable TV operator Kabel Baden-Wuerttemberg from Swedish private equity group EQT Partners AB, in a deal where the antitrust permission to go ahead with the deal was overturned by the German courts in August last year.

At Freshfields, a four-strong Amsterdam-based team advised Ziggo led by partner Jan Willem van der Staay, while Shearman & Sterling acted for Ziggo as legal counsel on financing matters, with City-based European capital markets partner Apostolos Gkoutzinis leading the team.

New York-headquartered Shearman previously acted for Liberty Global on its $23.3bn acquisition of Virgin Media in 2013.

Subject to the necessary approvals, Liberty Global and Ziggo anticipate that the offer will close in the second half of 2014.

Elsewhere, Dentons and Lawrence Graham have advised Hurricane Energy, which focuses on oil reserves in reservoirs beneath the North Sea and has already signed investment and drilling deals with BP and Transocean, as it prepares to float on the AIM market of the London Stock Exchange with a value of £272m.

Hurricane, which is expected to start drilling in the second half of 2014, was led by Dentons corporate partner Jeremy Cohen, alongside energy partner Danielle Beggs and environment partner Sam Boileu.

Cenkos Securities acted as Hurricane’s nomad and broker, with Lawrence Graham’s head of corporate Geoff Gouriet advising alongside senior associates Rebecca Gordon and Jenna Beever.

sarah.downey@legalease.co.uk

Legal Business

Blue sky thinking – A&O initiative to adopt and roll out new business ideas from clients

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Following on from its roll out of high-end contract lawyer service Peerpoint last November, Allen & Overy is continuing to challenge and develop its model with the introduction of an initiative to adopt new business practices from its clients.

The Magic Circle giant, led by senior partner David Morley, has pulled together five panels of between five and eight partners covering Asia Pacific; Middle East and Africa; Continental Europe; the US and the UK, to target its clients for ideas not usually seen in the legal sector across the entire business function including finance, human resources, strategy and IT.

The new initiative, dubbed ‘learning from clients’, will see each panel present five ideas at the global partners’ conference in Dubai at the beginning of March, led by Morley. The idea is to whittle down the submissions to five strong business proposals, which will then be put forward to the board to consider for implementation.

Morley said: ‘We are searching for ideas that have not been used in the legal industry. I approached partners around the whole firm as we want to cross-fertilise what partners in the Middle East can come up with, in comparison to partners in the US for example.’

The initiative comes after the firm in November became the first top-tier outfit to launch a high-end contract lawyer service for major clients, overseen by managing partner Wim Dejonghe. Peerpoint will see A&O-vetted freelance lawyers deployed to handle a range of fixed-term needs, including covering maternity leave or fulfilling secondment requests. The service will provide lawyers ranging in experience from the equivalent of a senior associate to partner level, drawing initially on former A&O lawyers who want to work flexibly.

The team currently has around 10 lawyers, and aims to grow to some 20 to 30 members in the coming weeks. Lawyers will be employed on a contract basis and paid the pro-rata equivalent of a full-time employee.

The firm has been known to encourage its partners to think outside of the box in the run up to conferences, including launching a project called ‘the long view’ in the run-up to its May 2012 partnership conference, in which five groups of partners from around the world were asked to sketch out what legal life will look like in 2020.

However, this time the iniative may have a significant impact on A&O’s own way of doing business and Morley added: ‘We want to generate a different set of ideas and take them out of context. Some will work and some won’t, but we need to get them on the table.’

jaishree.kalia@legalease.co.uk

Legal Business

Strategic recruitment: A&O hires employment team in Paris

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Allen & Overy (A&O) has underlined the importance of its global employment practice with a significant hire in France, recruiting highly regarded partner Claire Toumieux to head its employment and benefits department in Paris.

Toumieux joins from 18-partner, top-tier local employment firm Flichy Grangé Avocats where she was a partner, along with a team of three associates – Susan Ekrami, Alexandre Couvreur and Alexandre Orts. A recommended partner in The Legal 500 EMEA, Toumieux has experience of representing both listed and unlisted corporate groups and investment funds through mergers and acquisitions, collective bargaining agreements and reorganisations.

She was re-elected for a second two-year term as vice chair of the European Employment Lawyers Association (EELA) in September. She joined Flichy Grangé in 2000, before which she was at Gide Loyrette Nouel for four years.

A&O Paris managing partner Jean-Claude Rivalland said: ‘We are truly delighted to welcome Claire. Now, more than ever, employment law is one of the central concerns of our clients and is a key part of our firm’s growth strategy. Claire is well-known and highly respected as a lawyer in Paris. We are confident that she will bring a fresh impetus and perspective, and that, with the support of our well-established and experienced team, she will succeed in strengthening our position in this area.’

The hire of the new team brings A&O’s lawyer headcount in Paris to over 150, including 38 partners.

jaishree.kalia@legalease.co.uk

Legal Business

Commercially minded: Allen & Overy chooses BPP for business-focused LPC

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In what constitutes a major overhaul of its training programme, Allen & Overy (A&O) has announced today (16 December) that it will work with BPP law school to provide its young lawyers with an enhanced Legal Practice Course (LPC) with a Masters business component from 2015. The firm has also chosen BPP to run its Graduate Diploma in Law course from September next year.

The change in legal training institution came after a competitive tender process in which BPP was selected over the firm’s incumbent provider, the University of Law.

The firm’s new LPC aims to ensure that its lawyers develop commercial awareness as well as legal expertise. The business modules will be fully incorporated into the LPC and be taught via a combination of online and face-to-face classes, designed exclusively for A&O.

‘Launching this Masters programme ensures we continue to lead the market on training: this will further improve our junior lawyers’ business knowledge and their ability to provide our clients with commercially relevant advice. This will better equip them for a career in commercial law and provides the added benefit of a Masters-level qualification,’ said David Campbell, a partner and training principle at the firm.

On completion of the course, not only will trainees receive their LPC but during their training contract at the firm, trainees will also carry out a business intelligence project on a relevant topic, which may be an industry sector, a client or other related subject. After completing this element of the training contract, they will receive an MA(LPC with Business).

A&O recently announced its spring newly qualified lawyer retention rate stood at 84% but in the summer announced that it would reduce its trainee intake by 15% from 2015. The firm currently takes on 105 trainees a year.

david.stevenson@legalease.co.uk