Allen & Overy’s (A&O) newly appointed Asia managing partner Thomas Brown has been forced to pursue a new strategy in the region following a tumultuous week that saw seven Hong Kong corporate partners quit while its Indian best friend Trilegal splintered.
A&O China corporate head Michael Liu took six corporate partners to Latham & Watkins (TheLawyer.com, 10 October) after former board member Liu was passed over for the role of Asia chief in favour of Brown in June.
A&O has been pushed into realigning its Asia strategy to focus on M&A after the departure of the IPO-specialist team, but Brown stressed the need to rebuild the corporate practice so the firm will be prepared when IPOs return.
Brown said: “What we’re seeing are opportunities arising in relation to distressed M&A and that’s particularly driven by corporate clients and private equity houses looking for better valuations. In that context, what we’re really focusing on is building an M&A practice which is focused on distressed M&A and building relations with private equity.”
Against this background M&A partner Jeremy Hunt will succeed Liu as corporate chief. Hunt has been a partner for 10 years and transferred from London to Hong Kong around a year ago and has recently registered as a foreign lawyer there.
Former Asia chief Brian Harrison retired from the partnership in May and is in the process of handing over to Brown, an asset and project finance partner who has worked in the firm’s Bangkok, Hong Kong and Tokyo offices.
Liu made partner in 1994, having joined from a local Hong Kong firm. He built up an outstanding corporate practice in Hong Kong with a focus on IPOs. He recently advised the lead managers ;on ;Bank ;of ;China’s HK$75.4bn (£5.63bn) Hong Kong IPO.
The team’s departure removed seven of A&O’s 28 local partners, around half of its total Chinese corporate strength, and almost all of its Chinese IPO practice. Negotiations are ongoing about notice periods and how many associates will join the partners at Latham.
Last week A&O global managing partner Wim DeJonghe flew in to Hong Kong for crisis talks with staff and clients. He said: “It’s been a flat market in the last year so people have had time to think. Of course it’s a blow, no one’s going to deny that. But in a sense the timing is good.”
But a local rival claimed: “It’s a real statement. You can laugh off one partner leaving, but not seven.”
A&O senior partner David Morley made clear when he was elected earlier this year that Asia would be key to the firm’s future (The Lawyer, 3 March), but its ambitions in the region have been dented further after Indian referral firm Trilegal lost three of its 10 partners (TheLawyer.com, 16 October).
The trio of junior equity partners from Trilegal have left to set up an independent firm called Phoenix Legaltogether with a former senior partner from Indian firm Kochhar & Co.
Trilegal founding partner Anand Prasad said Phoenix would seek to emulate Trilegal’s success.
Although this is not a killer blow for Trilegal or A&O, it will still hurt to lose Trilegal’s first real generation of home-grown partner talent. All three had been with the firm since it was set up eight years ago.
Trilegal is left with five founding partners and two junior partners, who were made up this year. With just a handful of partners working alongside around 100 lawyers, associate and partner career progression will be kept high on the firm’s agenda.
And given A&O’s focus on Asia and its commitment to Trilegal, the Indian firm’s problems have also become A&O’s.