The UK200 2011 | By Joshua Freedman
3 October 2011
4 July 2012
4 July 2011
7 February 2011
9 May 2011
Energy’s up, but on the whole the corporate landscape has been distinctly lacking in dynamism, as the big four maintain their respectable distance from the chasing pack.
The world of corporate deals has been either on the road to recovery or rather dull, depending on who you ask and which statistics you believe. Energy lawyers have seen a notable upturn, with deals such as GDF Suez’s £17.1bn investment in International Power, which gave roles to Bredin Prat, Carey Olsen, Clifford Chance, Linklaters and Ogier. This deal was closed during the first quarter of 2011, a period in which there was a particular surge. In the same time period BP announced its £10bn share swap with Russian state-owned oil business Rosneft, a deal that gave mandates to Freshfields Bruckhaus Deringer and Linklaters.
The 2010-11 figures showing UK firms’ global corporate practice turnovers for the past financial year are undoubtedly influenced by uncertainty in the markets. Summers may always be quieter than the rest of the year, but developments in Greece made the middle months of 2010 truly a silly season.
There was a slight lull over the winter months before the rush of February to March, but it was events in Greece that had the major effect on the M&A market and law firms’ fortunes, with deals and projects being put on hold.
“Last year was a year where it improved throughout the year,” said Freshfields corporate partner and global practice head Ed Braham. “Everything was looking wonderful at the beginning of May. Then we had Greece. Greece killed the summer. From September onwards it picked up barring a lull over Christmas and the New Year. February, March and April were very strong.
“You tend to find in every year there are busy and quiet spans.
Last year it was a bit more protracted on the quiet side because Greece killed what’s usually a strong part of the year.”
Freshfields’ global corporate practice appears to have suffered slightly, turning over £376.2m in 2010-11, down by 5.7 per cent on the previous financial year’s figure of £399m. This was in turn a 1.1 per cent decrease from the £454.3m it produced in 2008-09, although the figure was up on the 2007-08 turnover.
This was despite some impressive client wins, including on the Rosneft deal, where it was instructed by BP, an established Linklaters client. However, if you add in competition and tax revenues, the figure is bolstered to £604.2m, putting it above Linklaters.
Linklaters, however, saw a clear increase in its corporate revenue, turning over £475.2m, or just under 40 per cent of overall income for the firm globally. Last year the practice contributed £449.5m, some 38 per cent of overall turnover.
Corporate partner Roger Barron said the firm has a “focus on client relationships across the board”; he insisted that partners “take a long-term view”. Chunky deals included the $10.7bn (£6.6bn) sale of telecommunications provider Zain’s African mobile business to Bharti Airtel, where it acted for Zain opposite Herbert Smith and Indian firm AZB & Partners.
Linklaters no doubt capitalised on the momentum the M&A market saw throughout the financial year: senior management insisted that cross-firm turnover was far better in the second half of 2010-11 than the first.
Slaughter and May maintains its position just behind the big four of Linklaters, Freshfields, Clifford Chance and Allen & Overy (A&O) when it comes to corporate turnover, although Slaughters’ figures are estimates as the firm does not disclose turnover figures.
Norton Rose suffered from the relative inactivity of key clients such as HSBC and Axa during the downturn, but was able to make ends meet thanks to the busy energy sector, which is one of the firm’s strongest tricks.
“Areas in which we’ve seen growth in business are in particular financial institutions, mining and commodities,” revealed Martin Scott, corporate head for Europe, the Middle East and Asia at Norton Rose.
The firm’s corporate turnover was up some 58 per cent, from £107.4m in 2009-10 to £169.3m, in 2010-11 thanks to the merger with Australian firm Deacons, which went live in January 2010.
The figures are hardly a comparison: global turnover zoomed up from £307m to £488m thanks to the five Australian offices, with corporate turnover static as a proportion of overall revenue, standing at roughly 35 per cent.
“[We had a] good time with private equity, which came back after having been dead for two years. Financial services was quite good to us as well,” said CMS Cameron McKenna UK corporate head Andrew Sheach.
Camerons’ corporate turnover figure of £51.8m, or 23 per cent of overall turnover, includes far less of the business than was covered in the 50 per cent figure it provided last year. Making comparisons is difficult. A like-for-like figure would be £45m for 2009-10.