Co-op Bank to hire new GC as the Co-op Group splits legal function

The Co-operative Bank has hired a new general counsel, in the wake of news that the bank will host the UK’s first ever ‘bail-in’ by a consortium of hedge funds (4 November 2013).

The hire of a new general counsel for the banking group is a departure from the Co-operative Group’s previously unified legal management, led by group general counsel Alistair Asher. 

Asher moved into the group’s chief legal role on 1 July 2013, having left his post as Allen & Overy’s financial institutions head (18 June 2013). He said the bank’s new GC will be announced before the end of November. The recruit will report to the bank’s CEO Niall Booker, with an additional operational reporting line to Asher. 

The news follows the announcement on Monday that the Co-operative Group would hand 70 per cent of the bank to private investors and close 50 branches, in a bid to fill its £1.5bn capital hole as required by regulators. 

The rescue is the first recapitalisation of a UK bank since the financial crisis, and the first – unlike Lloyds and the Royal Bank of Scotland – to be done without government intervention. 

A group of bondholders, including about 12 hedge funds led by Aurelius Capital and Silver Point, will take control of the bank which is expected to be listed on the London Stock Exchange in 2014. 

The Co-op Group’s longstanding advisor Allen & Overy took a key role in the restructuring for both the Co-op Group and the Co-op Bank, with partners Mark Sterling and Richard Slynn thought to have led the firm’s team. A&O will continue advising both parties going forward. 

Linklaters also played a substantial part in the deal, having been involved since its outset in May. Banking and restructuring partner David Ereira is thought to have led advice for both the Co-op Group and Bank. 

Clifford Chance, which has advised the Co-op Group for a number of years, has stepped up to scoop additional work in areas where A&O is conflicted. Asher invited the firm to advise on the shareholder relationship agreement between the bank and group, but the firm’s remit has recently been further extended. 

The firm’s team is being led by capital markets partner Iain Hunter, and includes corporate insurance partner Hilary Evenett, restructuring partner David Steinberg and banking partner Deborah Zandstra. They are being assisted by associates Adrian Cohen on restructuring, Vanesse Marsland on IP, Clare Hoxey on pensions, John Connolly on US securities law, Imogen Clark on employment and Simon James on litigation. 

Addleshaw Goddard provided support on data rooms and aspects of intra group documentation between the Co-op Group and the bank. 

Shearman & Sterling is advising the bondholders on the transaction having won a beauty parade in May. Its team includes global financial regulatory head Barney Reynolds, corporate partners Laurence Levy and Jeremy Kutner, acquisition finance partners Anthony Ward and Clifford Atkins, and bankruptcy partner Solomon Noh. 

Brown Rudnick’s European restructuring head Louise Verrill and financial regulation head Peter Bibby are representing a group of bondholders which has been driven by campaigner Mark Taber. 

Stephenson Harwood has also been involved, advising the trustee of various note issues which are being restructured.  Restructuring partner Susan Moore and finance partner Jayesh Patel led for the firm. 

Asher noted that, in future, the role of all firms involved will be decided by him in conjunction with the newly-appointed bank GC.