Legal Business

Shearman tight-lipped on City revenue amid reduced headcount and 4% global turnover rise

Shearman tight-lipped on City revenue amid reduced headcount and 4% global turnover rise

After rising by less than 1% in 2017, Shearman & Sterling’s global revenue grew at a slightly faster pace last year to hit $955.5m as profit per equity partner increased 5% to $2.4m.

The New York-headquartered firm today (21 February) declined to disclose its London revenue for the second year running, although senior partner David Beveridge told Legal Business the City office grew at a comparable rate to the firm globally. The last time Shearman released London numbers they showed a 14% revenue uptick to $169.7m in 2016.

Last year’s growth in City revenue came despite it reporting a drop of around 10% in lawyer headcount to about 160 from 178 the previous year.

‘This is the normal ebb and flow of the practice,’ said Beveridge. ‘We shifted people back to New York in leveraged finance. We will see the number come back up this year.’

Meanwhile, the 4% rise in firm-wide turnover came amid 3% growth in headcount to 882 from 853, meaning revenue per lawyer rose by just over 1% to $1.08m. The firm’s global revenue was up 27% on 2013.

Beveridge said the financial performance was ‘in line with what we expected and we will see more growth this year’, adding the firm was looking to achieve ‘profitable growth’ and pointed to a 53% increase in profitability over the last five years.

He said the firm was looking to grow in leveraged finance, mid-market private equity and M&A with a focus on energy, tech and life sciences. After concentrating its investment on the States in 2018 with the launch of two Texas offices in Austin and Houston, the firm will now look to ‘grow disproportionately’ in both the US and the City.

London remained the firm’s second largest office after New York, which is home to around 350 lawyers, while the States account for 60% of the firm’s workforce.

There were notable moves on the lateral front in London last year. Its high yield team lost guru Apostolos Gkoutzinis to Milbank Tweed Hadley & McCloy in January but managed to hire back Ward McKimm from Freshfields Bruckhaus Deringer in July. The firm also added Tim Scheddick from Baker McKenzie to its corporate practice.

Key mandates for the office included advising Boston Scientific on its $4.2bn acquisition of BTG.

Beveridge anticipated ‘consistent growth’ of between 5 and 10% year-on-year over the next several years.

A number of US firms have posted strong financials for their City practice so far. Reed Smith hiked London revenue by 18% to $222m and Akin Gump Strauss Hauer & Feld by 28% 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 added 16% to reach $66.7m.

marco.cillario@legalease.co.uk

Legal Business

Shearman wins McKimm from Freshfields as Penn returns to A&O from Cleary

Shearman wins McKimm from Freshfields as Penn returns to A&O from Cleary

Two standout moves in June and July saw the Magic Circle and the Wall Street elite each lose and gain one in partner reversions in London.

Ward McKimm, one of thestra most upwardly mobile partners the City has seen, made good on a long-rumoured defection to Shearman & Sterling’s capital markets practice, having previously worked there for some 14 years, becoming partner in 2005 and co-head of its corporate group in 2010.

Legal Business

Shearman and Mayer Brown retain fewer trainees than previous years’ newly-qualified solicitor intake

Shearman and Mayer Brown retain fewer trainees than previous years’ newly-qualified solicitor intake

Shearman & Sterling and Mayer Brown have recorded lower retention rates for their trainees due to qualify this autumn, from full retention last year to 87% and 73% respectively. 

Shearman will retain 87% of its London trainees due to qualify in September 2017, as 13 out of 15 trainees were offered and accepted newly qualified (NQ) positions at the firm. This represents a drop from both its 2016 and 2015 retention rates, when all 13 of its September qualifiers accepted full-time positions at the firm’s London office. This year’s figure remains above its 2014 rates, however, when the firm retained 75% of its final-year trainees to NQ positions.  

The US firm’s September NQ lawyers join the mergers and acquisitions, finance, financial Institutions advisory and financial regulatory, project development and finance, and antitrust global practices. Three members of Shearman’s NQ intake this year will take up international secondments in Brussels, Abu Dhabi and Singapore. 

Meanwhile, Mayer Brown confirmed that it will retain eight of its 11 second year trainees who joined in September 2015, a 73% retention rate. This represents a fall in comparison to its 100% retention this March, when all of the firm’s four second year trainees qualified. Two of its March trainees qualified into the firm’s banking and finance team, and one each into the dispute resolution and insurance practices respectively.

The rate increased from 2016, when Mayer Brown announced a 67% September retention rate, recruiting six of the nine group into NQ roles. The firm recorded a 100% retention rate for its March qualifiers in 2016, however, with all four kept on in the corporate and securities, construction and engineering and antitrust and competition practice groups.

The Chicago-headquartered firm confirmed that of the 11 autumn NQ solicitors this year, ten second-year trainees applied, nine were offered jobs and eight accepted.

Of those eight, two will qualify into the litigation team, one into banking and finance, and one each into the corporate & securities, real estate, pensions, employment & benefits and intellectual property practices.

Mayer Brown training principal William Glassey said the firm is ‘delighted’ that eight trainees will be staying on in permanent positions. ‘They represent our investment in the future of the firm and we look forward to watching their continuing development as they build their careers,’ he said.

Other firms to have announced their retention rates for this autumn include Burges Salmon and Blake Morgan. Burges Salmon announced in April this year that it will retain 100% of its 28 trainees, while Blake Morgan will keep eight of nine trainees who will qualify this September.

Georgiana.tudor@legalease.co.uk

 

 

Legal Business

Hogan Lovells hikes NQ pay by 5% in latest round of City increases

Hogan Lovells hikes NQ pay by 5% in latest round of City increases

Hogan Lovells’ UK newly-qualified (NQ) lawyers pay has risen 5%, as the firm increases junior associates’ salaries.

NQ pay jumped £3,500 to £71,500, while first year trainees’ salaries rose by £1,000 to £44,000. Second year trainees have also received a £1,000 increase to £49,000.

The changes came into effect on 1 May.

Lawyers with one year’s post-qualification experience (PQE) at Hogan Lovells have their pay determined by a merit based pay model with broad salary bands.

A firm spokesperson told Legal Business the mechanism ‘ensure[s] that we are able to take into account an individual’s performance when determining salary within the relevant salary band.’

‘In addition, our lawyers have the ability to earn significant bonuses based on chargeable hours and/or a discretionary bonus.’

Earlier this month, White & Case announced its London associates would receive a significant pay increase, with the US firm awarding its NQs a £15,000 pay hike to £105,000 for 2017.

White & Case lawyers with one year-PQE received a 16% raise from £95,000 to £110,000, while two year-PQE salaries increased by the largest percentage, up 19% to £120,000.

Shearman & Sterling were the first to announce UK pay increases this year. Shearman’s NQ pay rose by 10.5% from £95,000 to £105,000, with mid-level associates receiving a 9.5% bump in their pay from £126,000 to £138,000. The start of its senior associate salary band has risen by 5.6% to £165,000, from last year’s £156,000. 

madeleine.farman@legalease.co.uk

Legal Business

Shearman hikes UK associate pay following 14% increase in City revenue

Shearman hikes UK associate pay following 14% increase in City revenue

Shearman & Sterling‘s UK associates will see another increase to their salaries with newly qualified (NQ) lawyers taking home £10,000 more starting this month.

NQ pay has risen by 10.5% from £95,000 to £105,000 with mid-level associates receiving a 9.5% bump in their pay from £126,000 to £138,000. The start of the senior associate salary band has risen by 5.6%, up to £165,000 on last year’s £156,000.

The rise follows last year’s push by £7,000 to £95,000. NQ lawyers’ salaries were up from £88,000 in 2015, an 8% increase. This was £4,000 more than their peers at Linklaters, £10,000 more than their equivalents at Freshfields Bruckhaus Deringer and a whopping £23,500 more than at Slaughter and May. Mid-year associates saw their salaries up 10% to £126,000 – £11,000 more than 2015. Senior associates’ pay rose by £12,000 to £156,000. That equates to a 7% increase.

London managing partner Nick Buckworth (pictured) said: ‘We are committed to attracting and retaining the best of the brightest associates. Our salary rate increase is an acknowledgment of the hard work and commitment of our talented associates and recognises their ongoing contributions to the firm’s success.’

Shearman boosted its revenue by 6% for 2016, sitting at $912m. Profit per equity partner (PEP) jumped substantially by 18% up from $1.84m to $2.17m while lawyer headcount remained stable with an increase of six to 840. London’s lawyer headcount increased by five to 187 as City revenue was up by 14% to $169.7m.

The results will have eased concerns over last year’s mixed financials where Shearman posted a 2% rise in revenues which reached $860m, but PEP partner dropped 4% from $1.9m to $1.84m.

In the second half of last year Shearman agreed to cut its equity partnership and saw a series of departures, including private equity head Mark Soundy, who left in October along with UK tax head Sarah Priestley. Shearman’s European grouping, led by project finance partner Nick Buckworth, did not hire any new partners in Europe in 2016.

However last month Shearman reappointed antitrust lawyer Christopher Bright as a partner in London. Bright had been pointed by the government as a member of the UK Competition Commission in a part-time quasi-judicial decision-making role in 2006. Bright had stayed on at Shearman as a consultant following his appointment after he established the firm’s City antitrust practice.

madeleine.farman@legalease.co.uk

Read more: ‘Can Shearman finally get ahead of the curve after 15 years of diminishing returns?

 

Legal Business

Revolving doors: DLA Piper, Ince & Co bulk up in Germany while Shearman and Fox Williams bring in City partners

Revolving doors: DLA Piper, Ince & Co bulk up in Germany while Shearman and Fox Williams bring in City partners

DLA Piper and Ince & Co have made team hires in Germany this week, while Shearman & Sterling and Fox Williams have boosted their City offerings.

DLA Piper has brought on three corporate partners to its Frankfurt office from US firm K&L Gates. Mathias Schulze Steinen, Andreas Fuechsel and Claudius Paul will take up their posts next week bringing client relationships with The Carlyle Group, Oakley Capital Private Equity, Mood Media and Verivox.

Schulze Steinen advises local and international companies in corporate law, above all in restructuring measures, the law relating to stock corporations and corporate finance, and Fuechsel focusses on the fields of private equity/M&A, company law relating to capital markets, complex restructuring measures and the structuring of joint ventures. Paul specialises in private equity and M&A as well as in German corporate law, particularly in the technology, life sciences and financial services sectors.

Meanwhile, Ince & Co has acquired Hamburg law firm Schwenke & Partner which will join its German office on 1 May. Senior partner of the Hamburg firm Thomas Schwenke brings with him one associate, two paralegals and three business services staff. He specialises in corporate and finance in the shipping, offshore and renewable energy sectors. Schwenke trained and worked for specialist corporate and finance law firms in London and Hamburg as trainee, associate and partner before establishing Schwenke & Partner in 2000.

Shearman & Sterling has reappointed antitrust lawyer Christopher Bright in London, who was appointed by the government as a member of the UK Competition Commission in a part-time quasi-judicial decision-making role in 2006. Bright has stayed on at Shearman as a consultant following his appointment after he established the firm’s City antitrust practice. His appointment marks the first semblance of a lateral hire since the arrival of M&A partner Frank Miller from Freshfields Bruckhaus Deringer and Jeremy Sharpe in international arbitration from the US Department of State, both announced in September 2015.

Finally, Fox Williams has taken on Cooley regulatory partner Chris Finney who will join the firm’s London office next week. Finney is focused on UK and European regulatory issues. His clients include national and international (re)insurers, payment services providers, private equity venture capital fund managers, brokers and fintech companies of all kinds. Finney joined Cooley in 2015 – the year the US firm opened its doors in London – from Edwards Wildman Palmer (EWP). The vast majority of the firm’s London office made the move to Cooley’s City office ahead of EWP’s merger with Locke Lorde.

madeleine.farman@legalease.co.uk

 

Legal Business

‘He knows us well’: Anglo American appoints Shearman’s Price as new GC

‘He knows us well’: Anglo American appoints Shearman’s Price as new GC

Anglo American has appointed a former external adviser, Shearman & Sterling‘s co-head of mining and metals Richard Price, as its new group general counsel (GC) following the retirement of Ben Keisler.

Price will take up his new London-based role on 1 May and will sit on the mining giant’s management committee.

Capital markets partner Price joined Shearman’s London office in 2003. Before his transfer to the City, Price was based in Singapore where he headed up Shearman’s south-east Asian and Indian capital markets practice. He has also led the US firm’s EMEA capital markets group and EMEA corporate practice, and spent time at Shearman’s Toronto office.

He focuses on international equity and debt corporate finance transactions, SEC reporting, corporate governance and other corporate advisory and compliance matters. His clients have included Anglo American was a key client of his while at Shearman, as well as AngloGold Ashanti, ArcelorMittal, The Royal Bank of Scotland Group and Sasol.

Chief executive of Anglo American Mark Cutifani said: ‘We look forward to welcoming Richard Price as group general counsel, a key role that provides both strategic and commercial insight throughout our decision-making processes, while also forming part of the risk management of Anglo American as a whole. He knows us and our industry well, given the legal advisory work he has led on a number of complex issues and transactions, including in South Africa.’

Price will head up Anglo American’s global legal team following Keisler’s decision to retire earlier this year after 32 years.

Earlier this month it was revealed British investment firm Chrysaor Holdings had appointed BG’s chief counsel for corporate and former Legal Business GC Powerlist rising star Howard Landes as GC.

madeleine.farman@legalease.co.uk

Legal Business

US financials: Shearman partner cuts see PEP jump 18% as Sidley posts steady 3% revenue rise

US financials: Shearman partner cuts see PEP jump 18% as Sidley posts steady 3% revenue rise

Shearman & Sterling has boosted its revenue by 6% for 2016, sitting at $912m while Sidley Austin has seen more subdued results, with turnover up 3%.

Profit per equity partner (PEP) jumped substantially by 18% up from $1.84m to $2.17m. Lawyer headcount remained stable with an increase of six to 840. London’s lawyer headcount increased by five to 187 as City revenue was up by 14% increase to $169.7m.

The results will ease concerns over last year’s mixed financials where Shearman posted a 2% rise in revenues which reached $860m, but PEP partner dropped 4% from $1.9m to $1.84m.

In the second half of last year Shearman agreed to cut its equity partnership and saw a series of departures, including private equity head Mark Soundy, who left in October along with UK tax head Sarah Priestley. Shearman’s European grouping, led by project finance partner Nick Buckworth, did not hire any new partners in Europe in 2016.

Buckworth (pictured) told Legal Business: ‘We’ve had a much, much tighter view of our strategy, we’ve had strong leadership and as a result, just by being disciplined, you can see the results coming through. This is a firm that is very much on the up and we’re starting to really motor.’

When asked whether he expects more hires to be made in 2017, Buckworth added: ‘Scale is irrelevant. What we’re looking for is a growth that enhances Shearman & Sterling as a choice globally. Predominantly our growth will come from within, we have great talent here, and we’re always going to look at growth laterally in areas where we don’t necessarily have the internal, home-grown resource or in areas where we want to move the business.’

Meanwhile, Sidley Austin has posted a small revenue boost to $1.93bn, up around 3% on 2015. Profit per equity partner also crept up 3% to $2.13m while the firm saw a small increase in headcount to 1,836 from 1,779 and the total number of equity partners grew by four to 346.

The firm has made additional drives for European bench strength since the turn of the year, including an eight partner hire in Munich to significantly reinforce its European private equity offering.

madeleine.farman@legalease.co.uk

 

Legal Business

‘Significant in the post-Brexit market’: Shearman and Latham lead on Thomas Cook €750m high yield offering

‘Significant in the post-Brexit market’: Shearman and Latham lead on Thomas Cook €750m high yield offering

Shearman & Sterling and Latham & Watkins have advised Thomas Cook and the underwriting banks in the global travel specialists’ €750m high yield bond offering, guaranteed by various Thomas Cook subsidiaries. The offering comprised of 6.25% senior notes due 2022, and the proceeds will be used to refinance existing debt.

Shearman advised the lead underwriter Merrill Lynch International and co-managers DNB Markets and Lloyds Bank, alongside Société Générale, Barclays, BNP Paribas, Citigroup, Credit Industriel et Commercial, Credit Suisse, KBC, Morgan Stanley, RBS and UniCredit. The banks were also advised in Europe by Allen & Overy, Cederquist and Wolf Theiss Rechtsanwälte.

Shearman’s team was led by European capital markets head Apostolos Gkoutzinis (pictured) and included finance partners Korey Fevzi and Ronan Wicks, tax partners Kristen Garry in Washington DC and Simon Letherman in London and capital markets partner Marwa Elborai.

Latham advised Thomas Cook and its various subsidiaries in the UK, New York, France and Germany, with a team led by corporate finance partners Tracy Edmonson and Christopher Hall. Thomas Cook was also advised in Europe by Simmons & Simmons, CHSH Cerha Hempel Spiegelfeld Hlawati Rechtsanwälte, Noerr Menzer and Törngren Magnell. Simmons’ team was led by regulatory partner France Wilmet in Belgium and capital markets partner Marieke Driessen in Netherlands.

Gkoutzinis said: ‘We were delighted to represent the underwriting banks, led by our longstanding clients BofA Merrill Lynch, DNB Markets and Lloyds Bank, on this very significant transaction for Thomas Cook, the corporate debt market in the UK, and the broader European market especially post Brexit.’

georgiana.tudor@legalease.co.uk

For more on Shearman see: ‘Can Shearman finally get ahead of the curve after 15 years of diminishing returns?’

Legal Business

‘An important step’: Shearman’s Soundy and Priestley resurface at Goodwin

‘An important step’: Shearman’s Soundy and Priestley resurface at Goodwin

Goodwin Procter has confirmed Mark Soundy and Sarah Priestley are joining following their resignation from Shearman & Sterling.

Shearman’s former private equity head Soundy resigned in October after a three year stint. He was hired from Weil, Gotshal & Manges in a bid to establish the firm’s private equity offering in the City along with Priestley. Associate Simon Burrows also moved over from Weil to Shearman as partner at the same time but remains at the firm.

London-based Soundy focuses on UK and international M&A work, and has advised a number of institutional investors, international businesses and senior management teams while corporate tax specialist Priestley focuses on private equity and hedge funds. Soundy’s client base includes APAX Partners, Bridgepoint, GMT Communications and HgCapital/Mercury.

Goodwin Europe office chair David Evans (pictured) said: ‘Mark and Sarah are outstanding, highly experienced lawyers who will be terrific additions to Goodwin as we continue to build out our global private equity platform. Their appointment is an important step in ensuring that we continue to have a best-in-class private equity team that can represent clients across the UK, Europe, Asia and the US.’

Last month it was revealed King & Wood Mallesons’ (KWM) influential head of investment funds and major biller Michael Halford will also join Goodwin, a month after resigning from the troubled firm.

Major billers Ajay Pathak, Patrick Deasy, Ed Hall and Shawn D’Aguiar are also to sign with Goodwin. Part of the firm’s prized funds team, Pathak, Deasy and Hall are worth roughly £8m in billings.

Halford’s exit along with three other influential legacy SJ Berwin partners, Jonathan Pittal, Andrew Wingfield and Rob Day caused the firm to halt and ultimately fail in its plans to recapitalise the business, which is carrying more than £30m in debt.

madeleine.farman@legalease.co.uk

Read more: ‘Can Shearman finally get ahead of the curve after 15 years of diminishing returns?’