A&O scoops Kaupthing's purchase of UK bank

Allen & Overy (A&O) has muscled in on longstanding Slaughter and May client Kaupthing Bank.

The magic circle firm is advising Iceland's largest bank on its $1bn (£530m) recommended offer for UK bank Singer & Friedlander, the latest in a string of Icelandic raids on UK assets.

A&O won the plum role because Kaupthing's regular adviser Slaughters is acting for Singer. Slaughters' policy when clients are on both sides of a takeover is to advise the target. Commenting on the policy, a Slaughters corporate partner said: "For ethical reasons in such a situation, we'd typically act for the target in its hour of need."

A&O's team was led by corporate partner Alan Paul, with assistance from David Broadley. Slaughters corporate partner Robert Stern led the team advising Singer.

Kaupthing already owns 19.5 per cent of Singer, a shareholding it has built up since 2002.

Kaupthing's total assets are $23.6bn (£12.47bn) compared with Singer's £2.8bn. The Icelandic player aims to double the UK bank's return on equity, from 6.9 per cent to 15 per cent.

Completion of the deal is subject to regulatory approval. Singer will be delisted from the London Stock Exchange once the deal is completed.