The summer lull is over with a spate of new laterals for firms including multiple hires at DLA Piper, Simmons & Simmons and Fieldfisher, while US firm Winston & Strawn recruited in the City and Bristows and Weightmans both added to their benches.
If it ain’t broke… Do A&O’s New Law business lines live up to the hype?
After a series of ventures Allen & Overy has become the bellwether among the legal elite for innovation. But do the new business lines live up to the marketing?
‘We’re going to close the doors soon,’ says David Wakeling, the Allen & Overy (A&O) partner leading the City giant’s new tech-based service, MarginMatrix. It’s not often you hear a law firm talk of turning away potential clients, particularly not when they are some of the world’s largest banks.
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Taken to the limit – growing risks for law firms
A buyers’ market for professional indemnity cannot hide law firms’ exposure to growing risks
For a profession often accused of being overly obsessed with risk when advising clients, it is ironic that law firms are taking on uncharted levels of risk themselves.
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Costs of capital – senior counsel discuss hard lessons from the post-Lehman clampdown
With regulatory focus on financial services business unrelenting, effective risk management strategies are vital. We teamed up with Cornerstone Research to assess the challenges
Nine years ago, the financial services world began undergoing seismic changes with the onset of the credit crunch that have left the industry where it is today. The aftermath led to repeated overhauls of regulation, to the extent that none are certain what the endgame might be, particularly with significant new regulation such as Basel IV being widely spoken of.
Life during law: Guy Norman, Clifford Chance
It’s been a long career. I’m amazed at being here 27 years. People think that must be dull but I’ve had time abroad as a trainee in New York, in management in the Middle East, on secondment at the Takeover Panel. I don’t regret any of it.
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Looking forward to Ashurst’s decline
You cannot change the past. Move forward. Be constructive. Focus on making things better. Pick your cliché. And, like most clichés, they are built on the basis of common sense… and can still sometimes be beside the point.
Take Ashurst, which, having delivered a very poor 2015/16 trading period, is arguing once again that things will come good tomorrow. What else can leadership say? With Ashurst having been probably the worst-performing major City player since the banking crisis, such appeals are the only option.
Brexit: a pragmatic position for the worried managing partner
Theresa May’s claim from the distant history of July that ‘Brexit means Brexit’ has already become famous for answering nothing about the uncertainties facing the UK other than the government proposes to ultimately leave the EU.
Welcome to the uncharted waters of modern British politics – a claim often made but usually untrue. I don’t even follow the logic of those claiming Brexit is inevitable – you can as easily imagine an EU departure abandoned entirely as ending up with a hardline exit. There is nothing binding about the mandate – the public has had their say, but probably not their final say. No commitments – including indications from Downing Street that article 50 will not be triggered until well into 2017 – clear up the point.
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Soft law, hard sanctions – Human rights laws and the next risk front facing business
With human rights issues entering the mainstream of business practice, we teamed up with Herbert Smith Freehills to assess how new standards are changing the way in-house counsel operate
It turns out that the next risk front facing business and promising to reshape the role of general counsel (GCs) is a piece of legislation notorious among lawyers for having no teeth and little direct liability for companies.
The LB100: Methodology and notes
LB100 LAW FIRMS
The firms that appear in the Legal Business 100 (LB100) are the top 100 law firms in the UK, ranked by gross fee income generated over the financial year 2015/16 – usually 1 May 2015 to 30 April 2016. We call these the 2016 results. Where firms have identical fee incomes, the firms are ranked according to highest profit per equity partner (PEP).
LB100 firms forced to make own luck as tough times continue
The headline isn’t great, but it’s not bad either. Judging our annual Legal Business 100 (LB100) results, the industry has done better than expected overall, at least compared to 2015, when the group barely achieved growth despite a relative rebound in the UK and global economy.
This year, revenues across the LB100 dipped 2% to £20.2bn, heavily influenced by the removal of Dentons and Squire Patton Boggs from our tables. Back-of-the-envelope calculations show the group managed to hike income by roughly 3% on a like-for-like basis. Given the slowing of deal activity since the start of 2015 and some easing of investment ahead of the EU referendum, it could have been worse.
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The LB100: The second 50 – Even money
Regional firms are reporting patchy performances overall but the arrival of new entrants to the LB100 shows firms outside the capital are holding their own
National and regional firms are historically outperformed by their London equivalents in the bottom 50, but this year these firms are holding their own. There are 30 non-City firms in the 51-100 bracket, compared to 20 London firms, with a combined revenue of £1.14bn, down on the £1.2bn shared between 32 firms last year. Average revenue for this peer group is unchanged at £38m – the same as for the London-based firms. Profit per equity partner (PEP) has increased 9% to £329,000, compared to the City firms, which managed 7% growth to £435,000.
Legal Business 100 2016: Main Table
The LB100: The second 50 – Sterling performances
Brexit-related woes aside, City firms in the second 50 enjoyed a bumper year
When a firm depends on a signature practice area or specialism in certain sectors, a boom year can quickly turn bust during periods of economic turbulence. However, a number of the London-based practices and boutiques that occupy the second 50 of the Legal Business 100 (LB100) were the standout performers over 2015/16, despite Brexit-related headwinds during the second half of the year.
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LB100: relative revival for City elite in 2016 as a range of smaller players excel
The big four Magic Circle firms have posted their strongest performance in this year’s Legal Business 100 (LB100) since the recession, despite a subdued market overall. Although average revenue for the top 25 is down 3% to £622m, the combined revenue of Freshfields Bruckhaus Deringer, Linklaters, Clifford Chance and Allen & Overy (A&O) stands at £5.33bn, up 4% on last year, while average profit per equity partner (PEP) jumped 5% to £1.33m.
A&O managing partner Andrew Ballheimer said: ‘The year has seen mixed markets around the world. In that context these are another set of solid results which highlight our people’s ability to spot opportunities for growth.’
The LB100: The top 25 – In a spin
Previously outpaced by US rivals and the UK mid-tier, some optimism has been restored by the global elite in London. Legal Business decides where to place its bets
‘I will tell you the secret to getting rich on Wall Street. You try to be greedy when others are fearful. And you try to be fearful when others are greedy.’
Warren Buffett
SABMiller legal team faces autumn redundancies as £79bn AB InBev deal closes
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As brewing giant SABMiller’s global general counsel (GC) John Davidson prepares to stand down in 2017, up to 35 staff in the UK-based legal team are to be made redundant.
In 2015, the world’s second-largest brewer became the focus of a takeover approach fromAnheuser-Busch InBev (AB InBev) (at press time valued at £79bn). Since the deal was signed, a review was held and the company’s structure overhauled in August.
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The LB100: Profitability Revealed
In this table we blend together the three key profitability metrics, PEP, profit per lawyer and profit margin, to discover which of the top 100 firms are the most profitable. The firms have been ranked according to their aggregate score across all three measurements.
Tchenguiz brothers’ legal bill hits £5.1m in court battle against Grant Thornton
The drawn-out legal battle between property billionaires, Vincent and Robert Tchenguiz, and those they hold responsible for the Serious Fraud Office (SFO)’s botched investigation into their business dealings has proved a costly affair. It has emerged they have already paid out a collective £5.1m legal bill to date in their £3bn litigation against Grant Thornton and others, surpassing the SFO’s £4.5m settlement to the pair two years ago.
First filed by Vincent Tchenguiz after a settlement with the watchdog in 2014, the pair allege defendants, includingGrant Thornton, conspired to pass information, dishonestly, to the SFO in order to instigate and encourage an investigation by the watchdog into his relationship with collapsed Icelandic bankKaupthing, and that they did so for their own commercial gain.
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LB100 Focus: Don’t look back in anger: Ashurst leadership tries to rally partners but the drift continues
Five years on from its controversial Australian combination – and after a punishing 2015/16 – the storied City firm is still far from finding the form it needs in a competitive global market
‘We had known that the firm had been struggling for a while but we didn’t know, and certainly weren’t expecting, a 20% decrease to our [profit per equity partner] PEP,’ a recent Ashurst leaver tells Legal Business.
Eversheds consults on new management structure
Lee Ranson clear favourite to take chief executive role
Eversheds has begun talks to forge a new leadership team as the firm strives to avoid a divisive contest after current chief executive Bryan Hughes steps down next May. Current managing partner Lee Ranson is expected to take Hughes’ role in a management structure with two other partners.
Legal Business understands that current international managing partner Ian Gray’s post will change or a new role may be created, while global company commercial head Keith Froud is likely to be appointed as the new managing partner by Ranson.
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