Bucking a trend which has seen a number of City outposts of US firms grow apace last year, turnover at Cadwalader Wickersham & Taft’s London office dropped 13% to $43.1m in 2018.
While London suffered the impact of a five-partner team departure at the beginning of last year, global figures painted a rosier picture as firm-wide turnover grew 3% to $420.7m after three consecutive years of decline.
Global profit per equity partner (PEP) rose 8% to $2.7m from $2.51m even as its partner ranks grew by 3 to 43. In 2017 PEP rose at a pacier 19%, but revenues dropped by a striking 10% to $408.1m after years of retrenchment in a bid to concentrate efforts on a more focused client roster. After cutting 15% of its legal workforce in 2017, last year the firm kept its lawyer headcount flat at 373, with revenue per lawyer growing 3% to $1.13m.
Conversely, the drop in London revenue comes after years of solid growth for the firm’s 60-strong City arm, which in the five years to 2017 grew almost fivefold from $10.8m to $50m.
The beginning of 2018 saw the firm hit by the departure of a dozen of its restructuring lawyers, including well-regarded Yushan Ng, who quit for Milbank, Tweed, Hadley & McCloy, and head of loan portfolios, debt and claims trading Louisa Watt, who moved to Brown Rudnick.
London managing partner Gregory Petrick told Legal Business that the revenue generated by the team which stayed at the firm was up 13%, while also pointing to the fact that the office had rebuilt its ranks over the year, finishing 2018 with the same headcount as it started.
London hires in 2018 included fund finance partner Samantha Hutchinson from Dentons, while real estate finance partner Duncan Hubbard joined from Norton Rose Fulbright in January this year.
Next year the firm will move to new London premises at 100 Bishops Gate, with space for up to 150 lawyers. ‘We feel we have the right strategy and we are in an aggressive growth mode,’ said Petrick. ‘The London office is right at the centre of that growth strategy.’
The firm’s global financial results mark the end of a five-year review process of its business, which was badly hit by the global financial crisis and the collapse of some of its key clients such as Lehman Brothers. The firm slashed its headcount and shut its Asia offices in Hong Kong and Beijing, as it looked to focus on its core client base of financial institutions, large corporates and funds.
The firm now has three offices in the States – with around 200 lawyers in New York and bases in Washington DC and Charlotte – while in Europe it keeps a small outpost in Brussels alongside London.
‘We are a quintessential Wall Street firm, known for finance and finance-related products. We embraced and emphasised that more,’ said Petrick.
A number of other US firms have announced strong financial results for their London practices. Akin Gump Strauss Hauer & Feld recorded a 28% City revenue hike to $123.5m. White & Case’s London revenue rose 7% to $350m and Milbank Tweed Hadley & McCloy recorded a 25% increase in City turnover to $156m. Elsewhere, revenue for Goodwin Procter’s London office grew 58%, while King & Spalding was up 12% and Cooley’s 16% to $66.7m.