Tom Moore assesses the recent upheaval at Weil and talks to City head Francies about its ambitions
Life has never been dull at the City arm of Weil, Gotshal & Manges, but even those familiar with the firm’s eventful run since its launch in the mid-1990s turned their heads at the departure this summer of Stephen Lucas for Kirkland & Ellis. The former Linklaters partner, whose exit came shortly before his three-year guaranteed pay package expired, had been regarded as highly successful at building a deal finance team at Weil.
If Lucas was the talking point, there have been a number of notable partner departures over the last 12 months, with the firm’s London office having dropped from 31 to 26 partners. Most recently, well-regarded high-yield specialist Gil Strauss quit in late August for Simpson Thacher & Bartlett, hitting Weil in a core finance discipline. Set against that have been the recent hires of banking partner Chris McLaughlin from Hogan Lovells, Reena Gogna from Latham & Watkins and the headline-grabbing appointment of restructuring guru Andrew Wilkinson from Goldman Sachs.
The tax practice, which started 2013 with just four partners, is now down to one former Clifford Chance partner Jonathan Kandel – following the exit of Brenda Coleman to Ropes & Gray in December, Sarah Priestley to Shearman & Sterling in May 2013 and Andrew Norwood shifting from partner to consultant.
Of course, Weil’s City arm has had to contend with the fallout of a difficult 2013 for the firm, which announced 170 job losses as the work from the run of big-ticket insolvency jobs it picked up in the wake of the banking crisis slowed. While that restructuring clearly sent ripples through the London arm, its UK practice still posted 4% growth to £73m during 2013 and the message was that London remained a growth opportunity.
While investment has slowed after three years of rapid expansion that took the London office from 22 partners in July 2010 to 31 in July 2013, recent mandates demonstrate that Weil has continued to widen its business.
In the year to date, Weil’s London office has had lead roles in Hony Capital’s $1.54bn acquisition of Pizza Express, the €7.2bn sale of Spanish telecoms company ONO to Vodafone and secured a landmark judgment in July in the MF Global UK administration case, in which the High Court approved a settlement that will help facilitate the final distribution of around $1bn in client money.
Weil asserts that investment during 2010 and 2011 helped to win work that allowed the office to recently reach 150 fee-earners.
London managing partner Michael Francies tells Legal Business: ‘2012 was a huge year for us in terms of growth. 2013 was not “wow”, but it was a strong year and so far 2014 is very good. We’re looking very strong on a number of fronts, including the restructuring and finance practices, and structured finance is off the charts. The deal practice is off the charts as well and has been since the latter part of 2013.’
‘2012 was a huge year. 2013 was not “wow”, but it was a strong year and so far 2014 is very good.’
Michael Francies, Weil, Gotshal & Manges
A landmark decision achieved by a London litigation team led by partner Jamie Maples for Littlewoods Retail, winning a £1.2bn High Court and European Court of Justice victory against HMRC, typifies the greater range the practice has achieved beyond its traditional base in buyout and structured finance work.
But what of that finance practice? ‘I don’t think we need to [find a direct replacement for Lucas],’ responds Francies. ‘We recruited him at a time when we had a very small banking practice in London and were losing finance work because people felt we didn’t have the depth. Stephen helped build a top-tier leveraged finance practice. We’ve kept the clients and he’s left us in great shape.’
Wilkinson in particular has been tasked with bringing in high-end restructuring work. Francies comments: ‘Andrew has been brought in to further develop the practice to take advantage of more pan-European corporate restructuring and more hedge fund distressed-type work. We’ve already been involved in some situations we likely wouldn’t have been in had he not been here.’
Such a feat would be a big win for a firm that has until recently struggled to extend its huge reputation in US restructuring to the City. As such there will be close attention on how Wilkinson, as one of the genuine pioneers of the UK restructuring scene, fits in with Adam Plainer, who Weil hired from Jones Day in 2011 to build up its UK insolvency practice.
In some ways, this unsettled phase is nothing new for Weil, an office built on strong individuals, and which has been prone to bursts of introspection and periodic runs of departures. Despite such rough patches, the practice has continued to edge up the value chain, albeit it in occasionally melodramatic fits and starts.
So what now for Weil’s London office? Private equity growth is the focus, with the office’s strategy pinned on that trickling into other practices. ‘I would like to see the private equity practice continuing to grow at the rate it’s been growing over the last 12 months as that would create so many more opportunities across the office,’ says Francies. ‘We wouldn’t want a major deal to happen unless we had a major role somewhere. We have a lot of young partners, and over the next three years they will develop and transform the business.’
tom.moore@legalease.co.uk