Legal Business

Three’s company: BLP’s former head of restructuring Ben Larkin joins Jones Day

Three’s company: BLP’s former head of restructuring Ben Larkin joins Jones Day

The third partner to leave Berwin Leighton Paisner (BLP) for Jones Day in under six months, former head of restructuring and insolvency Ben Larkin has joined the top 10 Global100 law firm’s 100 lawyer-strong global restructuring practice.

Described as ‘an excellent operator’ by the Legal 500, during his time at BLP Larkin advised on stand out mandates such as the restructuring of companies in the TXU Group and acted for RBS in the restructuring of Le Méridien hotel group.

Larkin advises a wide variety of funds, investment banks and corporations and is currently leading cross border restructurings in the telecom, pharmaceutical and energy sectors. He specialises in corporate restructuring, turnaround and insolvency matters.

‘Ben is a superb practitioner with a market-leading reputation. He will be a perfect fit with our client base and international reach,’ said John Phillips, partner-in-charge of Jones Day’s London office.

‘Our global restructuring business is exceptionally busy with complex mandates from our investment fund, banking, and corporate client base,’ added Paul Leake, leader of Jones Day’s global business restructuring and reorganization practice. ‘Ben brings with him a wealth of experience that will be invaluable for the continuing development of our international practice.’

Larkin’s arrival follows that of BLP private equity chief Raymond McKeeve, who joined Jones Day in August 2013 followed shortly by fellow private equity partner Michael Weir.

Earlier this month BLP’s employment head Fraser Youlson joined Squire Sanders after leaving BLP in December. Matthew Kellett, former head of finance, left the firm October, prompting an external review of the firm’s finance practice.

David.stevenson@legalease.co.uk

Legal Business

Further finance exit for BLP as Marcus Jamson joins Wedlake Bell

Further finance exit for BLP as Marcus Jamson joins Wedlake Bell

Berwin Leighton Paisner’s (BLP’s) depleted finance department has seen a further partner exit after acquisition finance partner Marcus Jamson this month joined top LB100 UK firm Wedlake Bell.

The Slaughter and May-trained lawyer specialises in domestic and international corporate lending and has over 20 years of experience acting for clearing banks, financial institutions, investment banks and private equity sponsors on financings and debt restructurings.

His departure is the latest in a series of partner exits including finance and restructuring partner Trevor Wood, who left for Mayer Brown in October, and head of banking and finance Matthew Kellett, whose exit also in October prompted the 786-lawyer firm to launch an independent review of its finance practice.

The review, which it is understood is being conducted by management consultants Jomati, is being overseen internally by managing partner Neville Eisenberg and executive chairman Robert MacGregor.

Meanwhile, 108-lawyer Wedlake Bell has been bolstering its London office for some time, including the December hire of Pinsent Masons commercial property partner Suzanne Gill.

Gill’s hire followed the March arrival of Dundas & Wilson corporate partner Julian Mathews and Farrer & Co corporate and capital markets partner Jai Bell.

The firm enjoyed a 21% increase in revenues in the last financial year to £26.9m after the firm’s merger with fellow London firm Cumberland Ellis in February 2012. That merger saw the combined practice post a 131% rise in profit per equity partner at the end of the last financial year to £319,000, up from £138,000 at the end of 2011/12.

Wedlake Bell’s managing partner Martin Arnold said: ‘Marcus is an excellent addition to our already strong finance and banking team. His breadth of experience across the sector will be invaluable in a challenging and highly competitive area, one that we expect to grow.’

david.stevenson@legalease.co.uk

Legal Business

LLP latest – Herbert Smith Freehills sees its overdraft rise by 140% as borrowing totals £111m

Significantly increased debt has been a recurring theme for many of the latest limited liability partnership (LLP) accounts filed at Companies House and Herbert Smith Freehills is no exception, with its overdraft up over 140% from £26m to £62.7m and total bank borrowing up by 28% to £110.7m.

In the first accounts filed since Herbert Smith’s June 2012 merger with Australia’s Freehills, the global LLP accounts reveal that revenue is slightly down on last summer’s unaudited figure of £471.2m, standing at £469m. The accounts, which do not include the Australian side of the business, further show a LLP cash position of £29m.

Meanwhile, the highest paid member this year received £2m, compared to £1.6m the previous year.

The accounts, signed off by senior partner Jonathan Scott and outgoing chief executive officers (CEO) David Willis and Gavin Bell state: ‘Transactional activities in the UK and Europe remained muted between October 2012 and April 2013, while we also faced challenging conditions in Asia and Australia.’

They make reference to the cash call that legacy Herbert Smith equity partners had to make in May last year to bring its finances in line with Freehills, worth around £20m.

Other firms to have filed their 2012/13 LLP accounts at Companies House include Berwin Leighton Paisner, which saw a 221% increase in bank borrowing in the 2012/13 financial year.

The 790-lawyer firm’s borrowing has risen to £45m from £14m the previous year.

david.stevenson@legalease.co.uk

Legal Business

Damned statistics: BLP and Ashurst report higher trainee retention rates from smaller intakes

Damned statistics: BLP and Ashurst report higher trainee retention rates from smaller intakes

Firms have kick-started the year reporting high trainee retention rates with Berwin Leighton Paisner (BLP) and Ashurst retaining the vast majority of their newly qualified (NQ) trainees, although total intake numbers at the firms were noticeably lower than last time around.

BLP confirmed 89% of its spring 2014 qualifiers will remain at the firm, rising slightly from 86% of the autumn 2013 qualifiers, but maintaining its recovery from its March 2013 results when the firm offered positions to just 64% of trainees or 14 from a total of 22.

This year, the firm took on fewer trainees – 18 – and made offers to 17, of which 16 accepted roles. From the pack, one will transfer to Singapore while the rest will remain in the UK.

Training principal at BLP Anthony Lennox said: ‘I am delighted we have achieved such a high retention rate, which reinforces the fact that the calibre of trainees BLP has is fantastic and shows their commitment to the firm, and ours to them.’

Ashurst reported an even higher retention rate of 96% – increasing for the third intake running – with 23 trainees from a smaller group of 24 taking up roles this year, making the actual number of trainees retained lower than last September’s levels when 24 (or 80%), of its 30 trainees stayed on at the firm. However, this is up from its spring 2013 intake when 19 of 27, or 70%, of NQs were retained.

This year, one trainee will work in the firm’s energy, resources, real estate and infrastructure group based in Abu Dhabi while the remainder will stay in the London.

The news follows other firms also announcing favourable retention rates with Olswang revealing last week (10 January) it will keep 100% of all of its trainees. From a total of eight, seven will remain in the London branch, while one will be qualifying in the firm’s Thames Valley office. This is two more trainees kept on than in the autumn, when the firm retained 6 of its 11 trainees, giving it a retention rate of 54%.

Nabarro also revealed a 100% retention rate early this year (7 January), with all eight of its trainees having accepted positions at the firm’s London offices. This follows a 96% retention rate from a much bigger intake last September, when 25 from a total of 26 trainees were kept on.

Jaishree.kalia@legalease.co.uk

Legal Business

LLP filings 2012/13 – BLP sees bank borrowing increase from £14m to £45m

LLP filings 2012/13 – BLP sees bank borrowing increase from £14m to £45m

Following a year of partner departures and a significant drop in profit per equity partner, Berwin Leighton Paisner’s limited liability partnership (LLP) accounts have revealed a 221% increase in bank borrowing in the 2012/13 financial year.

The 790-lawyer firm’s borrowing has risen to £45m from £14m the previous year.

However, in what appears to be a re-financing of debt, the top 20 firm has significantly reduced its overdraft facility, which is down from £4.5m to £371,000 and overall the firm owes £76m to creditors, compared to £51.3m the previous year.

The latest LLP accounts filed with Companies House show that in the last financial year, profits at the firm fell to £52.3m compared with £81m the previous year, a 32% drop.

The highest paid partner earned £1.2m, down from £1.6m the previous year, with overall fee income down from £245.9m to £231.9m.

Last year BLP revealed that its profit per equity partner figure was down by 39% from £660,000 to £401,000 and the firm also saw a number of partner departures, including private equity head Raymond McKeeve to Jones Day, tax head Liesl Fichardt, who left for Clifford Chance, and Managed Legal Services head Patrick Somers, who joined DLA Piper last September.

The firm was also one of a number of LB100 top 50 firms to complete a redundancy round last year, resulting in the loss of 102 jobs including 58 legal staff and 44 secretarial staff, achieving the aim of reducing salary costs by 15%.

However, in line with the predictions of a number of senior partners at the firm, including longstanding managing partner Neville Eisenberg, BLP’s half year results show some signs of recovery, posting a 6% increase in turnover compared to the same time last year.

The firm has also made a number of strategic hires to bolster its core real estate practice, including most recently a rated three partner real estate team from Akin Gump Strauss Hauer & Feld’s Moscow office.

david.stevenson@legalease.co.uk

Legal Business

Moscow team hire: Goltsblat BLP take on real estate trio from Akin Gump

Moscow team hire: Goltsblat BLP take on real estate trio from Akin Gump

Berwin Leighton Paisner (BLP) has bolstered its global real estate capability with the hire of a rated three partner team from Akin Gump Strauss Hauer & Feld’s Moscow office.

The team, which is set to join Goltsblat BLP in mid-January 2014, includes the current head of Akin Gump’s real estate practice in Russia, Vladislav Sourkov, who will be joined by his colleagues Rustam Aliev and Dmitry Maltsev. Sourkov is described by The Legal 500 as ‘dedicated, experienced, and very driven on client service’.

The trio’s hire will mean that Goltsblat’s first-tier real estate and construction practice, led by Vitaly Mozharowski, is one of the largest in Russia, a statement from the firm said today (10 December). It coincides with BLP’s decision to build its market-leading real estate practice of around 360 lawyers worldwide, which spans offices including Berlin, Frankfurt, Abu Dhabi, Dubai, Hong Kong, Beijing and London.

These hires follow the announcement in November that Karen Friebe, the former global co-chair of DLA Piper’s hospitality and leisure group, will join BLP from early next year.

Notable global deals pointed to by the 780-lawyer firm include Allianz’s €300m acquisition of the office complex ‘Skyper’ in Frankfurt and the joint venture between CBRE Global Investors and Teacher Retirement System, Texas, on the purchase of the Leine Centre in Hannover for €117m.

‘BLP is renowned internationally for its expertise in real estate and we are delighted that such a regarded team of legal experts will provide added weight to the highly successful GBLP’s real estate practice in Russia as well as to our global real estate capability,’ said James Knox (pictured), international real estate partner at the firm, who joined from Linklaters in 2010.

Moscow is one of the biggest real estate markets in Europe, third after London and Paris, with investment in the sector forecast to reach between $7-8bn this year.

david.stevenson@legalease.co.uk

Legal Business

H1 2013/14: BLP reveals a 6% increase in turnover

H1 2013/14: BLP reveals a 6% increase in turnover

By any estimation 2012/13 was Berwin Leighton Paisner’s (BLP’s) annus horribilis but the top 20 firm is showing modest signs of recovery with today’s (2 December) announcement that its revenues are up by 6% on this time last year.

Partners at the 786-lawyer firm have for some time privately indicated that its 2013/14 revenues are showing signs of improvement and the 6% rise, while starting from a low base given its 5% decline from £246m to £233m last year, is confirmation that their quiet confidence is, to an extent, justified.

BLP’s performance during the last financial year was hit by its rapid expansion overseas, particularly in the face of a declining transactional market. However, BLP’s managing partner Neville Eisenberg said: ‘We had a good first half and activity levels in the firm continue to be encouraging.

‘Over the first six months our offices outside London experienced strong growth. London also performed well with our litigation and real estate departments having a particularly busy six months.’

In September this year it emerged that BLP’s long-awaited profits per equity partner (PEP) had slumped by 39% and this 2013/14 half year (H1) figure – in common with the majority of H1s released by the LB100 firms so far – gives no indication as to whether the firm’s critical PEP figure is up or down on this time last year.

Overall the H1 2013/14 figures released so far have indicated a far more benign market than this time last year, with Allen & Overy’s turnover up by 7.5% to £608m thanks in large part to a strong performance in its litigation and, more surprisingly, its finance practices.

However, with a number of mid-tier players having recently turned out strong double digit H1 increases in turnover – including Olswang, which saw revenue up by 15% to £57.6m and Osborne Clarke up by 12% to €71.6m – BLP’s results are encouraging but will not be interpreted as meaning that the beleaguered firm has been given the all clear.

jaishree.kalia@legalease.co.uk

Legal Business

Back to basics: BLP hires DLA Piper real estate partner Karen Friebe

Back to basics: BLP hires DLA Piper real estate partner Karen Friebe

More recently the subject of headlines announcing partner departures, Berwin Leighton Paisner (BLP) today announced the appointment of Karen Friebe, a real estate partner from DLA Piper as sources indicate the traditionally real estate driven firm is taking a back to basics approach to consolidation.

Friebe (pictured), who specialises in the hotel and leisure sector and will join BLP as a partner in its global real estate practice based in London, was the global co-chair of DLA Piper’s hospitality and leisure group and led its EMEA hospitality and leisure team for a number of years.

She joins a leading real estate team focused on mergers and acquisitions, management agreements, development projects and franchising and boasting clients such as Balfour Beatty, Barclays, Marriott Hotels and the Olympic Delivery Authority.

Chris de Pury, real estate departmental managing partner, said: ‘Karen has a wealth of experience across the real estate sector as a whole and her specific knowledge of the global hotel market will prove invaluable as we look to add further to our leading hotel and leisure offering. Karen will also be a great role model for our associates.’

The arrival will be a boost to BLP, coming in the wake of a string of high profile partner departures, including global head of private equity Raymond McKeeve and fellow partner Michael Weir to Jones Day in August and September respectively, contentious tax head Liesl Fichardt to Clifford Chance and commercial and technology head Adam Rose to Mishcon de Reya.

The moves follow a poor 2012/13 financial performance from the top 20 firm, which revealed in September that its profits are down by 39% to £401,000, following a revenue drop of 5% to £233m.

However, managing partner Neville Eisenberg recently told Legal Business that this year has already seen improvement, with one ex-partner also recently suggesting that the firm is focussing much of its energies on its real estate roots, which has remained a core area for the firm despite its recent rapid expansion.

david.stevenson@legalease.co.uk

Legal Business

UPDATED: BLP launches independent review of finance practice after team head departs

Berwin Leighton Paisner‘s (BLP’s) head of banking and finance Matthew Kellett is to leave the firm, it was confirmed today (30 October), with BLP launching an independent review of its finance practice.

A spokesperson for the firm said: ‘Matthew Kellett has decided to leave BLP to pursue his business and other interests. Matthew will stay in his role until a successor has been appointed. The finance team continues to retain significant clients and is involved an increasing amount of international and multi-practice work.

The review, which will be overseen by managing partner Neville Eisenberg and executive chairman Robert MacGregor, will see the firm engage an external consultant to assess its 150-lawyer finance practice. The team has undertaken work for the Royal Bank of Scotland, Barclays and Goldman Sachs, but it has a slimmer institutional client roster than some peer group firms.

‘We are also taking this opportunity to conduct an independent review of the department, in conjunction with the finance partners, to assess how best to take advantage of the opportunities for the team going forward.’

The review will raise fresh questions over the future of the firm’s finance practice, which has often been criticised for poor performance and excessive use of expensive lateral recruits.

The firm is already facing intense scrutiny following a difficult period with BLP in 2012/13 seeing profit per equity partner fall 39% from £660,000 to £401,000. Revenues decreased 5% to £233m, making it the worst financial performer of the top UK 25 firms this year.

The firm completed a redundancy round in May, which resulted in the loss of 102 jobs including 58 legal staff and 44 secretarial staff.

BLP also reacted with a shake-up of its partnership that has resulted in substantial numbers of partners being asked to leave. The firm’s woes are believed to be largely due to over-expansion – in particular a number of struggling investments in Asia – and a run of mis-firing senior recruits.

The 220-partner firm – until recently generally regarded as one of the most upwardly mobile practices outside London’s top 10 – has been ready to offer guaranteed pay deals above its core equity ladder for some high profile partner recruits. While the aggressive recruitment strategy has worked well in a number of cases, notably in its core real estate practice, the results have long been viewed as mixed in corporate and finance.

There will be expectations that BLP will reverse its previous attempt to build a multi-product line banking offering in favour of a smaller, support practice to handle mainstream finance work.

Update/4.10pm

Legal Business discussed the review with BLP managing partner Neville Eisenberg who described it as a ‘forward looking’ exercise and ‘not a post-mortem’.

He added: ‘The review is to look at what opportunities we have and to reassess the practice’s resources and whether they’re right for the market. We have a number of teams within finance. [But] we’re not going to focus only on real estate, we are investing in the future.’

Asked about the firm’s decision two years ago to move its profitable property finance team into its real estate practice – a move that was criticised by some internally – Eisenberg said it was ‘the right thing to do’.  Eisenberg concluded: ‘After our restructuring earlier this year we are now in good shape.’

david.stevenson@legalease.co.uk

For more commentary on BLP click here

Legal Business

City ambitions – Mayer Brown adds to London laterals tally with hire of BLP finance partner

City ambitions – Mayer Brown adds to London laterals tally with hire of BLP finance partner

Mayer Brown has added to its tally of recent London hires as Berwin Leighton Paisner (BLP) finance and restructuring partner Trevor Wood joins the US firm.

Wood will be reunited with former BLP banking and finance partner Richard Todd when he joins 1,536-lawyer Mayer Brown, which has made six lateral hires in its London office in the last month, compared to just five in 2012.

Meanwhile, BLP’s partner departures continue in the wake of the firm’s disclosure in September that its profits for 2012/13 are down by nearly 40%. The firm also unveiled a drop in revenues this summer of 5% to £233m, making it the worst financial performer of the top 25 UK firms.

At the start of this month (October) BLP private equity partner Michael Weir joined former colleague and head of private equity Raymond McKeeve at Jones Day. Other recent departures include Patrick Somers, who spearheaded BLP’s Managed Legal Services initiative and who joined DLA Piper in September. In the same month, Mishcon de Reya announced the hire of non-contentious commercial partner Adam Rose, while rated contentious tax head Liesl Fichardt left for Clifford Chance.

The moves come as BLP moves to address its profitability issues. The top 20 firm also completed a redundancy round in May, which resulted in the loss of 102 jobs including 58 legal staff and 44 secretarial staff with the aim of reducing salary costs by 15%.

Before this year BLP was labelled as one of the most upwardly mobile firms in the last decade, with an enviable long-term performance. However, over-expansion into difficult markets, together with a drop in transactional work and the cost of an aggressive lateral hiring strategy has seen it hit hard, although, according to one senior partner at the firm, BLP has already seen growth on this time last year.

david.stevenson@legalease.co.uk

For further analysis of BLP’s performance see Comment: The lingering enigma of BLP’s bad year