As third-party funders enjoy robust growth within a buoyant disputes climate, Legal Business assesses current attitudes towards litigation’s controversial bankrollers.
Third-party litigation funders have suffered bad PR for more than 40 years. Often depicted as lurking in the shadows of the courtroom, waiting to collect their share of damages, lawyers have historically been curiously wary of funders since their inception.
As AIG’s general counsel for Europe, the Middle East and Africa, Chris Newby appears extraordinarily calm for a man in charge of a burgeoning portion of a $65.7bn business, that was described as on the brink of failure a couple of years ago.
Now, happily labelled as the ‘largest turnaround in corporate history’, things could easily have turned out very differently at New York-headquartered AIG. Newby’s apparent poise masks the prolonged period of extreme uncertainty and hard work that it took to get there. It’s unsurprising that he is still cautious, commenting: ‘There is no doubt there are signs of economic recovery, but we inevitably still face challenges.’
As confidence begins to re-emerge at City finance teams, Legal Business profiles the mid-market players intent on challenging the Square Mile’s banking heavyweights
Bernard Sharp, global chair of the banking and finance group at Baker & McKenzie, may be tempting fate when he says: ‘The market has a lot in common now with the market in 2007.’ Still, his comment certainly reflects a more bullish mood among a cadre of players operating just below the largest six or seven banking practices in the City.
Continue reading “Punch above weight – the finance teams aiming to take on the City’s heavyweights”
Bank of Tokyo-Mitsubishi UFJ (BTMU) has announced its first-ever panel for Europe, the Middle East and Africa (EMEA), with eight leading City firms appointed after a process described as ‘extremely competitive’.
Allen & Overy (A&O), Linklaters and Ashurst won places, alongside Berwin Leighton Paisner, Hogan Lovells, Norton Rose Fulbright, Slaughter and May, and White & Case.
BTMU has also created a separate, confidential transactional panel on which the preferred firms have won a place, alongside ‘other market-leading firms in a range of different practice areas’, which the bank would not disclose.
Born of a merger between the Bank of Tokyo Mitsubishi and UFJ Bank in 2006, BTMU approached a number of firms to apply for the panel, with an initial deadline of September.
Continue reading “Bank of Tokyo-Mitsubishi launches first EMEA panel”
More than a decade after international law firms reshaped the market, Germany’s singular economy and culture is still refusing to simply conform to foreign notions. Legal Business reports.
Over the last 15 years, the German legal profession has obtained the dubious honour of being one of the most fractious major markets in the world. Today, both domestic and international law firms are still trying to come to terms with the inimitable characteristics of the economy and legal market. For many, the correct strategy is still a mystery.
Continue reading “How the dust settles – Germany’s profession is forever changed but singular still”
For a FTSE 100 company operating in 20 countries, BG Group’s panel of four law firms was already slim, but it just got slimmer, with news last month that Allen & Overy (A&O) and Herbert Smith Freehills (HSF) have been dropped in favour of Clifford Chance (CC), which wins a place alongside incumbents CMS Cameron McKenna and Freshfields Bruckhaus Deringer.
The appointment of the firms – which will offer full-service advice to the energy giant – came into effect on 1 November and follows a relatively short pitch process, which began in September.
Continue reading “BG Group slims down legal roster to three”
David Stevenson reports on Reed Smith’s evolution into credible global contender
For a 1,500-lawyer, top-30 Global 100 firm, Reed Smith has a habit of quietly getting on with its business. This is despite having conducted three mergers since 2001; grown by around one jurisdiction a year; and made a series of high-profile City hires as it builds out from its core shipping and litigation foundations in the UK – in so doing significantly boosting its 2013 London revenues.
The resignation in October of global managing partner Greg Jordan was a rare senior departure for the nearly 700-partner law firm, which in London this year hired Clifford Chance (CC) structured finance and derivatives partner Claude Brown (after hiring his former colleague Peter Zaman in 2012); McDermott Will & Emery City energy partner Rashpaul Bahia; and DLA Piper media partner Askandar Samad.
Continue reading “Reed Smith set for record year in London thanks to lateral push and sector focus”
Eighteen months ago I met the general counsel (GC) of a FTSE 250 company to listen to his plans to parcel up parts of his deals, based on complexity, and hand each chunk to a different panel adviser based on skillset, capability and cost.
Until very recently, this level of micro-management – and the prospect that law firms would no longer be handed a deal lock, stock and barrel – was not going down well. Not long after meeting this GC, I sat between two well-known managing partners at a dinner and listened to them assert matter-of-factly that this sort of tinkering round the edges would never become mainstream.
Continue reading “The City elite is ready to try something new – are clients keeping up?”
As latest payout confirmed to Lehman’s creditors, total US and UK costs soar to $2bn
Clifford Chance is among the creditors of the European operations of Lehman Brothers set to receive a windfall after administrator PwC announced a total payout of $7.8bn, the latest in a series of payments made to creditors of the former US investment bank as it nears the end of its mammoth winding-up process.
According to one partner at the Magic Circle firm, the payment could be as much as £10m and a spokesperson for PwC said creditors are likely to receive payment before the end of the calendar year.
Lehman Brothers filed for Chapter 11 bankruptcy in September 2008, listing $639bn of assets against $613bn of outstanding debt but within days creditors filed claims of $1.2trn, double its assets.
Freelance lawyers to cover fixed-term needs.
For all the talk of innovation in the profession, experimentation with new models has so far been more evident at mid-pack players like Berwin Leighton Paisner (BLP) and Eversheds than elite London or New York advisers.
However, as Legal Business revealed on 25 November, Allen & Overy (A&O) has become the first top-tier outfit to challenge that orthodoxy with the Magic Circle firm launching a high-end contract lawyer service for major clients.
Continue reading “A&O the first top-tier player to forge contract lawyer service”
City firm to move junior lawyers to structure based on merit and market rates.
RPC has taken the final steps to adopting an entirely merit-driven pay model as it last month announced that it will abolish the traditional flat-rate salary for newly-qualified solicitors (NQs) in the UK and move to a system linked to merit and market rates from September 2014.
In a move said to take into account what is happening in other sectors and the pressures that clients are under to achieve value, the firm will operate a variable pay scale where the strongest NQs entering their careers ‘in the most competitive areas of the profession’, will be eligible to earn salaries above those currently offered by major City firms, a firm statement said. Continue reading “RPC abolishes flat-rate salary for newly-qualified solicitors”
Proposed merger promises Birmingham firm significant City presence.
The announcement last month that Wragge & Co and Lawrence Graham (LG) are in merger talks makes a lot of sense on many levels, although competitors have inevitably been quick to point out obvious pitfalls.
Both firms have been hunting for suitors for a long time and for Wragges, the talks could provide the serious London foothold that has so long eluded it, despite a series of high-profile Birmingham transfers and London hires.
Continue reading “If the shoe just about fits – Wragges in merger talks with Lawrence Graham”
The queue of international firms looking to enter the South African market became one shorter in November, as transatlantic giant Hogan Lovells announced it had tied up with Routledge Modise after ten months of talks.
The 40-partner South African firm, an ally of Eversheds until October last year, will operate under the Hogan Lovells banner, but will not share the same profit pool, as local regulations prohibit it.
Current Routledge chairman Lavery Modise will retain his title in South Africa, while the directors of the firm will now be referred to as partners. The new team is not expected to take up any positions on Hogan Lovells’ board. Continue reading “Gateway to Africa: Hogan Lovells ties-up with Routledge Modise”
It’s not been the ideal launch after the final phase of its high-stakes global merger. Within days of the union between Ashurst and its Australian ally going live on 1 November, the combined firm has seen a run of senior departures and barely concealed dismay in some quarters at the surprise leadership defeat of Charlie Geffen.
Global head of corporate Stephen Lloyd resigned at the start of November, within weeks of Ashurst voting with an overwhelming 97% majority in favour of full financial integration with Australian big six firm Blake Dawson, and shortly after litigator Ben Tidswell won the vote for the firm’s new chairman role.
Continue reading “Ashurst faces senior departures after key merger goes live”
Behind the scenes of the first-ever creditor bail-in of a bank in the UK.
Last month The Co-operative Group’s £1.5bn recapitalisation plan for its beleaguered banking arm unravelled as subordinated bondholder activists advised by Shearman & Sterling negotiated hard and settled on a controlling stake of 70% of the shares of the bank.
Under the agreement, bondholders including US hedge funds led by Aurelius Capital Management and Silver Point Capital – dubbed the LT2 Group as they hold subordinated bonds – will receive 70% of the shares in The Co-operative Bank plus £100m in newly-issued securities. They will also inject £125m of fresh capital into the bank while parent company The Co-operative Group will retain a 30% stake. Continue reading “Shearman settles controlling stake in Co-operative Bank for US hedge funds”
I’m a forward-looking type of guy. Looking back on your career is something you do when you’re retiring. At the bright chickeny age of 50 it’s not the right time to be looking back. In a traditional English law firm, when you come to 50 there’s this unspoken thing of ‘when are you going to go?’ It’s sort of like granny sitting in the corner. In a US firm nobody thinks you know anything until you’re at least 50.
Management is not my thing. I’m more interested in the clients and doing the work. Triangulating complicated personalities and mucking about in committees is not my thing. Continue reading “Life During Law: Marco Compagnoni”
Merged regional giant beats four rivals for out-of-London mandates
Following a competitive tender process between five of its panel law firms, AIG has awarded its bulk contract work to Bond Dickinson, as the insurance giant’s general counsel for Europe, the Middle East and Africa, Chris Newby focuses his team on more strategic, higher level legal work.
AIG concluded its main panel review in September, appointing a 25-strong list of advisers, including Freshfields Bruckhaus Deringer, Berwin Leighton Paisner and DLA Piper.
A secondary tendering process was conducted among five panel firms for the job of updating and modernising hundreds of medium risk, high-volume but low-value contracts with AIG’s providers.
Continue reading “Bond Dickinson wins AIG tender for volume contract work”
Cyclical departments increasing contribution to bottom line
As an analytical tool half-year figures may be superficial but as a litmus test of performance they show, on the basis of the figures released by LB100 firms so far, that 2013/14 will be a much improved and more benign year.
Firms including Allen & Overy (A&O), Clyde & Co and Simmons & Simmons have disclosed increases in revenue, with signs that cyclical departments such as finance and real estate are beginning to increase their contribution to the bottom line again.
Continue reading “Half-year financial results point to relative revival at leading UK firms”
Aside from bad knitwear and excessive alcohol consumption, Christmas is a time for reflection as well as looking ahead. With this in mind, we asked some senior law firm figures for their thoughts. Rose-tinted spectacles are optional.
‘Much of our focus this year has inevitably been on integration and on being instructed because of capabilities created as a result of our merger. We have done very well in both areas and the sheer number of so-called synergy mandates has been a real highlight. Against an improving but still uncertain economic backdrop in 2013, our financial performance has been satisfactory. Continue reading “The Last Word: A year in review”
The pharmaceutical industry is the driving force behind a number of recent high-value M&A transactions as drugs companies look for new ways to consolidate, and address patent expiration in a trend forecast to continue.
In November, Novartis sold off part of its operation, its blood transfusion diagnostics unit, to Barcelona-based Grifols for an estimated $1.68bn, as the Swiss pharma giant conducts a wholesale review of its business.
