Legal Business

Revolving doors: Strategic growth for Mishcon, Hill Dickinson, Herbert Smith Freehills, Orrick Rambaud and Addleshaw Goddard

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Strategic recruitment Herbert Smith FreehillsMishcon de Reya
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Mishcon de Reya this week (25 November) announced that it is to completely restructure its tax offering, consolidating its real estate, corporate tax, and private tax and wealth planning divisions and invest in the area with the hire King & Wood Mallesons SJ Berwin tax partner John Skoulding and solicitor Charlie Sosna from Berkeley Law.

Focusing on UK and international M&A, management buy-outs and corporate restructurings, among other issues, Skoulding has worked across sectors including betting and gaming, fashion, retail, intellectual property and financial services.

The launch of Mishcon’s new tax practice is said by the top 40 firm to recognise the changing needs of its clients, as their personal and business concerns increasingly overlap, and Andrew Goldstone, head of private tax and wealth planning commented: ‘John and Charlie are great additions to the team – they are joining at a busy and exciting time, not just for our tax practice, but also the firm more broadly.

‘We’ve expanded from 300 employees in 2009, to over 500 in 2012, and have seen a 75% revenue rise within this period. This was achieved by investing in people and securing the best talent, and these new hires demonstrate our on-going commitment to this strategy.’

Also in London, Blake Lapthorn banking and finance partner Claire Wheatley, who launched the top 65 LB100 firm’s City banking practice with her arrival from Clyde & Co in 2009, has joined Hill Dickinson.

Wheatley, who has also held roles at Howard Kennedy, Freshfields Bruckhaus Deringer and Clifford Chance since 1988, said: ‘Hill Dickinson has an excellent reputation in the City, particularly within the banking and finance sector and I look forward to drawing on my connections with international banks, property companies and private sector organisations to further develop the team’s well established relationships in the City.’

On the Continent meanwhile, Herbert Smith Freehills’ (HSF) Paris office last Thursday (21 November) announced the growth of its Paris-based Africa, energy and infrastructure teams, with the arrival of Gide Loyrette Nouel oil, gas and mining corporate partner Leïla Hubeaut and JeantetAssocies mining and infrastructure associate Hiba Abi Haidar.

Hubeaut, who before Gide was part of the corporate team at Ernst & Young, combines her oil and gas practice with privatisations and business structuring/restructuring for African nations. Her experience, the firm said in a statement, extends to all regulatory aspects of projects, especially in obtaining permits and other government approvals.

Stéphane Brabant, head of the five-partner, thirty-lawyer Paris energy and infrastructure practice and the global Africa practice at HSF, commented: ‘Leïla and Hiba combine the strong advantages of thorough technical expertise and a solid understanding of the African environment, which will help us provide even better service to our clients investing in the continent.’

Also in the vibrant Paris market, where Speechly Bircham this week launched with the hire of an 11-lawyer team, former SJ Berwin partner Etienne Boursican joined Orrick Rambaud Martel’s regional private equity practice.

Boursican focuses on M&A and capital markets, particularly advising and acting for listed companies in cross-border transactions involving tender offers, sale and purchase of equity stakes, public offerings, private placements and IPOs.

Pascal Agboyibor, Orrick’s Paris office head said: ‘The European M&A market continues to be a favoured destination for international investors with Paris acting as a vital centre for M&A activity throughout the continent.’

Orrick recently advised Paris-based Neolane on its $600 million acquisition by Adobe Systems and represented U-Shin on its $270 million acquisition of Paris-based Valeo S.A.’s access mechanisms business.

Elsewhere, Addleshaw Goddard has strengthened its Arab Gulf Coordination Council (GCC) offering with the hire of K&L Gates head of private equity for the GCC, Andrew Johnston, who joins a month after the hire of Clyde & Co corporate partner Ben Gillespie in Dubai.

Johnston and Gillespie, who will work alongside corporate partners Keith Johnston and Tim Field, join as the 660-lawyer firm invests in new service lines beyond its core offering of international arbitration and construction litigation in the Dubai office, which opened in September 2012 following the hire of Trowers & Hamlins regional head of construction, Andrew Greaves.

International division managing partner Andrew Carpenter said: ‘Andrew and Ben’s hires are the latest in a series of exciting investments we have made to broaden our international capability and to accelerate the growth of our GCC team.

‘Both partners have significant experience of acting in Dubai and the wider region and have practices that can be leveraged across our three GCC offices and the UK, as well as complimenting the investment we have already made in the UAE. Their hires are an exciting milestone and are indicative of our progress and ambitions.’

francesca.fanshawe@legalease.co.uk

Legal Business

HSF fallout continues as two Freehills partners quit firm in Singapore

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Asia Herbert Smith Freehills
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The fallout from last year’s combination of Herbert Smith and Australia’s Freehills continues to rumble on, with news that HSF‘s Singapore office has been weakened by two senior departures.

Former Freehills Singapore managing partner John Dick has left the firm following corporate partner Geoffrey Grice’s move to Duane Morris & Selvan in Singapore.

Dick is named in The Legal 500 Asia-Pacific as a leading individual for projects and energy, while Brice joined Freehills in 2009 from the state solicitor’s office of Western Australia and has over 20 years’ experience advising on major projects and cross-border transactions in Europe and Asia Pacific.

Singapore was the one jurisdiction where both legacy firms had a presence, although Freehills’ Singapore lawyers moved into Herbert Smith’s offices shortly after the merger went live in October 2012. However, the departures have not been isolated to legacy Freehills, as Herbert Smith energy partner Michelle Chen left to join Jones Day in November last year.

There has also been movement below partner level, with associates from both legacy firms leaving since the merger, such as senior associate Nicolas Watts and Simon Barrell moving to K&L Gates and Norton Rose Fulbright respectively on the Freehills side while litigators Rob Palmer and Chris Bailey both joined Ashurst as partners at the beginning of the year from Herbert Smith.

However, Freehills has also been relocating partners to Singapore, with Nichola Yeomans, an M&A partner, joining the office from Sydney at the beginning of the year.

A spokesman for HSF, confirming the partner departures, said: ‘there are always going to issues with integrating two firms, but this has been said for some time now’.

A continued source of contention within the firm has been the thorny issue of integration of the two financial systems. Talks were held last Friday in London and Monday in Australia as the firm looks for a way to break the deadlock before the departures continue.

david.stevenson@legalease.co.uk

Legal Business

Learning to live together – HSF strives to thrash out compromise on partner pay as key vote looms

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Leadership Herbert Smith Freehills
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It often seems getting a deal agreed is the hardest part – as in the case of Herbert Smith, which in 2012 agreed to combine with Australian leader Freehills – but working out those thorny integration issues can make you long for the simplicity of a straight merger vote.

Almost 18 months after agreeing its union Herbert Smith Freehills (HSF) is still thrashing out how to make its combined remuneration system work, having originally been expected to agree a model in October that would see the combined firm move to a variant of Freehills’ aggressively modified lockstep.

Four proposed models that were put forward in October failed to win support, leaving the firm searching for an acceptable compromise. One sticking point were proposals to introduce discretionary gates, which displeased London partners wedded to Herbert Smith’s more conservative lockstep regime.

Partners contacted by Legal Business last week indicated that meetings were being held on Friday (15 November) and today (18 November) to finalise proposals for an imminent vote. The official line is that it will take place ‘by mid-December’.

With the issue generating strong feelings at the legacy Herbert Smith partnership, there has been talk that the firm will move to a lightly modified lockstep half way between the legacy firms’ systems. The twist in the tail is the idea that legacy Freehills would retain some scope to pay bonuses for star laterals and high billers that would not be used by legacy Herbert Smith. The unusual move – which is viewed as a compromise to bridge the different sides – would mean the two firms would operate a largely integrated pay model but with limited carve outs for the Australia side of the business.

Legacy Herbert Smith’s lockstep has fixed share partners serving four years before making it onto the equity ladder, which runs from 43 to 100 points. Freehills operates a core ‘ladder’ running to 120 points, though up to another 40 points can be handed out as bonuses, which are typically given to top-performing partners and laterals. The Freehills models means that partners can earn well over £1m, in comparison top of equity at Herbert Smith of £933,000 during the 2011/12 year, when the City law firm saw profits per equity (PEP) partner of £840,000.

The two firms already moved to a single profit pool when the merger went live in October 2012, so have yet to report net income for a full financial year.

One HSF partner commented: ‘Any time you touch remuneration it’s going to be a touchy subject. It forced both sides to think what’s good and what could be better under their respective systems.’

Another partner at the firm comments: ‘It [remuneration reform] was all looking a bit of a fudge last time I looked.’

However, supporters of this compromise see it as better than the two sides simply maintaining fundamentally different ways of rewarding partners.

The remuneration talks come as the firm also prepares to vote on its new chief executive or joint chief executives by the end of the year, as David Willis and Gavin Bell step down in April 2014. One partner said that given the geographical spread of the firm, they expect that the role will continue to operate on a dual basis. Partners viewed as likely contenders include litigation head Sonya Leydecker, UK managing partner Ian Cox, global head of corporate Mike Ferraro and EMEA managing partner Allen Hanen.

david.stevenson@legalease.co.uk

Legal Business

Hogan Lovells’ ambitious capital expansion draws in second HSF partner

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Strategic recruitment Herbert Smith FreehillsHogan Lovells
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As Herbert Smith Freehills (HSF) continues to lose London partners so Hogan Lovells is in the midst of aggressively bulking up in the capital and today (5 November) announced internally that HSF environmental partner Louise Moore will re-join the firm.

Moore – who focuses on M&A and private equity and has advised high profile clients including Energy Capital Partners, Chevron, BP and EDF – will re-join the transatlantic firm’s London office in early 2014, having trained with legacy Lovells and become an environmental partner before moving to HSF in 2007.

Commenting on Moore’s arrival, Andrew Skipper, global co-head of Hogan Lovells’ corporate practice said: ‘Louise has a strong global reputation for environmental work and we are delighted to have her back. Her skills and experience in the field speak for themselves and she is a great fit with our practice, complementing perfectly our corporate, disputes and energy and infrastructure teams.’

Moore added: ‘Hogan Lovells offers an exceptional international platform to really develop an unparalleled global environmental team which is integrated with its market-leading transactional and disputes practices.’

Hogan Lovells has made a number of significant hires into its London office this year, and is expected to make more. This is its second raid on HSF’s London office in under six months, after it hired tax litigation partner Rupert Shiers as head of direct tax disputes in June, and more recently brought on Field Fisher Waterhouse’s privacy and information group head Eduardo Ustaran. Ustaran is notably being held to a 19-month notice period, keeping him at Field Fisher until May 2015. Elsewhere, SJ Berwin private equity partner Ed Harris also quit for Hogan Lovells in late October.

Meanwhile, for HSF, Moore’s move follows disputes star Ted Greeno’s departure for Quinn Emanuel Urquhart & Sullivan earlier this year; London corporate fraud and asset tracing head Simon Bushell’s move to Latham & Watkins in February; and financial services duo Martyn Hopper and Nikunj Kiri arrival at Linklaters in January.

sarah.downey@legalease.co.uk

Legal Business

Going nuclear – Herbert Smith advises EDF on £16bn power plant deal

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Corporate Herbert Smith Freehills
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The UK government’s game-changing decision to build the first nuclear power plant for a generation has seen Herbert Smith Freehills advise longstanding client EDF Energy on the deal.

The £16bn agreement to build two European pressurised reactors at the Hinkley Point C site in Somerset is the culmination of two and a half years of negotiations between the two parties and Julia Pyke (pictured), a Herbert Smith partner and co-head of the firm’s nuclear group, told Legal Business ‘It has been immensely satisfying to reach this milestone.

‘The UK Government’s policy of encouraging low carbon power sources and greater self-sufficiency in energy generation will be bolstered by the agreement of this contract.’

Herbert Smith has advised EDF on all aspects of its nuclear plans since 2006, including energy, regulatory and corporate law, planning, real estate, environment, construction, finance, EU/State aid, competition and public law.

The Herbert Smith cross practice team was led by Pyke and also included Brussels-based competition partner Lode Van Den Hende who advised EDF on state aid.

The deal is worth around £16bn over 10 years, with investment also coming from the energy company alongside its two Chinese partners, China National Nuclear Corporation, and China General Nuclear Power Corporation in return for a guaranteed rate of £92.50 for every megawatt hour of power produced by the Somerset plant for 35 years.

Mark Newbery, global head of energy at Herbert Smith, said: ‘We are delighted to have advised EDF on the latest phase of this high-profile and strategically-important project. Today’s announcement marks a significant step forward for both the project and the wider industry, while showcasing the strength and breadth of HSF’s offering for international energy companies such as EDF.’

david.stevenson@legalease.co.uk

Legal Business

Regulatory upheaval: MoJ reshuffle leaves reforms uncertain as LSB drops Herbert Smith for judicial review

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Legal affairs FieldfisherHerbert Smith Freehills
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The future of regulatory reform of the legal sector appears to be hanging in the balance as justice minister Helen Grant, who announced the review in June, is replaced by former solicitor Shailesh Vara and further announcements over changes to the Ministry of Justice (MoJ) team are awaited.

The review, which has seen regulators and representative bodies including the Solicitors Regulation Authority, the Law Society, the Bar Standards Board (BSB), the Bar Council and the Legal Services Board (LSB) submit proposals for reform to the MoJ, is currently one of a number of issues being considered as the MoJ decides what the revamped team’s ‘portfolio’ will include.

A spokesperson for the MoJ said: ‘There may be changes, there may not be, we will know more by the end of the week.’

The submissions saw the BSB and the Bar Council call for the abolition of the LSB, which is also currently embroiled in a dispute with the Criminal Bar Association (CBA) over its decision to go ahead with the highly unpopular Quality Assurance Scheme for Advocates (QASA).

The CBA issued a legal challenge in September when CBA chairman Nigel Lithman QC claimed: ‘The well-argued submissions of the criminal bar on the problems inherent in the proposed QASA scheme fell on deaf ears as our regulators determined to plough ahead and impose it in its entirety.’

The LSB today (9 October) confirmed to Legal Business that Herbert Smith Freehills, the panel firm which it has instructed to defend against its decision to introduce the four level grading system for criminal advocates, has been taken off the defence after the firm rejected a Protective Costs Order that would have led to its fees being capped. Fellow panel firm Field Fisher Waterhouse has been instructed, led by senior partner Matthew Lohn.

A spokesman for the LSB told Legal Business: ‘We are constantly managing our expenses and costs.’

11 KBW’s Nigel Giffin QC, who was instructed by Herbert Smith, will continue to represent the LSB.

Baker & McKenzie is representing the CBA, led by partner Joanna Ludlam who is instructing counsel Blackstone Chambers’ Dinah Rose QC and Tom De La Mare QC. CBA members Rufus Taylor, David Howker QC, Christopher Hewertson and Katherine Lumsdon, are also working for the claimant on a pro bono basis.

The LSB’s legal panel consists of Eversheds, Field Fisher, Herbert Smith, Bates Wells & Braithwaite, Bircham Dyson Bell and Hogan Lovells.

The case is due to be heard later this year. Herbert Smith declined to comment.

david.stevenson@legalease.co.uk

Legal Business

US/UK hires: Mayer Brown boosts London securitisation team as Herbert Smith hires New York financial services litigator

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Strategic recruitment Herbert Smith FreehillsMayer Brown
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Mayer Brown is boosting its English law securitisation capability with the hire of former Mayer Brown lawyer Richard Todd, who re-joins the firm from Berwin Leighton Paisner (BLP) alongside Allen & Overy banking associate David O’Connor.

Todd will work on domestic and international structured financings alongside former colleague and head of the banking and finance division Dominic Griffiths, as well as senior securitisation partner Kevin Hawken.

Todd joins from BLP’s banking and capital markets department, where he has been since February last year. Prior to BLP, Todd worked as an in-house lawyer at Lloyds Banking Group from September 2010, where he was director of structured capital markets focussing primarily on providing legal support to the bank’s conduit securitisation areas.

Todd joins alongside Allen & Overy’s O’Connor, an ex-banker at Deutsche Bank. In his new role, O’Connor will be working closely with recently recruited Ashley Katz, Devi Shah and litigation partner Alistair Graham, who joined in January 2013, on CMBS restructurings.

Griffiths said: ‘We are a core adviser to a number of clients in the securitisation sector and for some time now we have been keen to further expand our English law team to meet client demand.’

While US firms progress in London is overshadowing City firms’ performance across the Atlantic, Herbert Smith Freehills also today (7 October) announced it has boosted its dispute resolution practice in New York with the hire of Cooley’s head of financial services litigation, Scott Balber. Balber will head the 2323-lawyer firm’s investigations and financial services litigation for the US and establish its corporate crime and investigations practice.

Scott also specialises in white collar defence, regulatory matters and securities and commercial litigation. Before Cooley, he was co-head of the commercial litigation practice at Chadbourne & Parke.

The hire comes as the firm focuses on expanding its global corporate crime practice across its network. It launched the New York office in September 2012 and the office also includes an international arbitration team led by Larry Shore and a litigation team led by Thomas Riley, which handles US and cross-border litigation for network clients.

Herbert Smith’s global disputes practice head Sonya Leydecker said: ‘Establishing an on the ground corporate crime and investigations capability in New York has been a cornerstone of our disputes US strategy. In Scott, we have found a perfect combination – a market-leading expert, who is also a dynamic business developer with an impressive track record of developing long-standing client relationships.’

jaishree.kalia@legalease.co.uk

Legal Business

Great bright hopes – searching out the City rainmakers of 2020

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Magic Circle AshurstHerbert Smith FreehillsHogan Lovells
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Who will be the next generation of corporate heavyweights that top City firms will rely on to drive their businesses in the decade ahead? Legal Business canvassed a wide group of deal veterans to identify the ones to watch.

It is often said that the best of the City’s M&A partners were battled-hardened and defined by the early 1990s recession. That formative experience is often argued to have helped refine the skills and ethos of the select band of M&A heavyweights that dominated the City legal market through the last 15 years.

Legal Business

Herbert Smith Freehills to have a new CEO next year as Bell and Willis step down

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Leadership Herbert Smith Freehills
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David Willis and Gavin Bell, joint chief executive officers at Herbert Smith Freehills (HSF), have announced today (24 September) that they will step down from their roles next Spring.

Willis’ term as managing partner was expected to end in April this year but he agreed to a one-year extension following the merger of Herbert Smith and Freehills last autumn. Bell has been managing partner of Freehills since 1995 but due to serious health issues earlier this year, from which he has fully recovered, he has decided to step down and spend more time with his family.

‘David and Gavin are two of the principal architects of the merger. We are hugely appreciative of their outstanding work in the period leading up to the merger and they have been very successful and effective joint CEOs. That the transitional management structure more broadly has worked well is in no small way down to their contributions,’ said Jonathan Scott, senior partner of HSF.

The HSF global council, the firm’s governance body, will decide whether Willis and Bell will be replaced by a single CEO or whether the role will continue to be undertaken jointly. The decision is then subject to partner ratification in a process that will be completed by the end of 2014. The firm would not speculate on potential candidates for the role, although one of the names mentioned to Legal Business at this early stage is intellectual property partner Mark Shillito.

There is still plenty for Willis and Bell to do before handing over the reins. HSF is currently in the middle of a significant transitional phase post-merger and has seen a string of high-profile exits in recent months, including Ted Greeno to Quinn Emanuel Urquhart & Sullivan, Will Pearce to Davis Polk and Kevin Lloyd to Debevoise & Plimpton.

The firm is also reviewing its remuneration system in order to comprehensively integrate the financial systems at the two legacy firms. This process should be completed by the start of the next financial year, in time for the new CEO(s) to take over the firm’s leadership.

David.stevenson@legalease.co.uk

Legal Business

Close to the wire: Freshfields and Herbert Smith settle £142m London Underground negligence claim

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Litigation Freshfields Bruckhaus DeringerHerbert Smith Freehills
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Freshfields Bruckhaus Deringer and Herbert Smith Freehills have reached an eleventh hour settlement of the £142m professional negligence claim brought against them by London Underground (LUL).

Due to be heard over a four week period in October, the case is arguably the largest ever filed against a City firm.

LUL was represented by Ince & Co partner Charlotte Davies, who instructed 4 New Court Square’s Justin Fenwick QC, while Freshfields drafted in bar heavyweight Tony Grabiner QC of One Essex Court to defend it, and Herbert Smith fielded Fountain Court’s Tim Dutton QC.

The initial High Court claim was issued against 2332-lawyer Freshfields by LUL in January 2011, in relation to the company’s public-private partnership (PPP) with now-defunct transport company Metronet, which was responsible for the maintenance, renewal and upgrade of the infrastructure on nine LUL lines between 2003 and 2008 under the PPP arrangement.

Following a turbulent period during which Metronet was implicated in the May 2004 derailment at White City, the company went into administration in 2007, leaving LUL liable under the PPP agreement to purchase its debt, eventually becoming liable to pay around £1.74bn.

Magic Circle firm Freshfields was served with a £178.5m claim in July 2011 while legacy Herbert Smith was named as second defendant in the dispute in 2012. That sum was subsequently reduced after LUL managed to recoup some of its losses.

The precise terms of the settlement are confidential but a statement from Herbert Smith said: ‘Transport for London, Freshfields Bruckhaus Deringer LLP and Herbert Smith Freehills LLP have agreed to end the litigation concerning legal advice relating to Metronet’s borrowings under the PPP. All parties involved are pleased to have resolved this dispute without the need to go to trial. The terms of settlement are commercially confidential.’

sarah.downey@legalease.co.uk