Andersen Legal firm Garretts is losing its two highly-rated employee share scheme partners to Allen & Overy (A&O).
Paul McCarthy and Sylvie Watts, who are based in Garretts’ London office, handle equity incentive share schemes and equity-based remunerations. They will join A&O’s employment, pensions and incentives (EPI) department within the next few months.
Watts acted on the demerger of ICI and on the privatisation of National Power. She has also drawn up incentive plans for British Petroleum and Reuters.
McCarthy acted on the privatisation of Powergen and Scottish Power and was also responsible for drafting the legislation for the windfall tax in conjunction with the Treasury.
The partners’ client list includes AstraZeneca, British Telecommunication, News International and Tesco.
Garretts has a strong employee benefits practice and acts for more than a third of the FTSE 100 companies.
The move will leave Garretts with five partners handling employment and pensions work but with one only one associate handling share scheme work.
One source claims that clients will be forced to take their share scheme work elsewhere. But Garretts senior partner Tony Williams denies that the moves will force clients out. “We are looking at how to adjust the practice. There are a number of qualified lawyers acting as consultants within Arthur Andersen and we are looking to see whether to redeploy lawyers from Arthur Andersen to Andersen Legal or whether we will need to recruit,” he says. “There is no urgency but we do need to do something long term.”
At A&O, Watts and McCarthy will handle employment tax and share incentive work.
An A&O spokesperson says that the firm is expanding its EPI department because of the demand from its corporate clients.
He says there is also considerable opportunity to expand EPI in mainland Europe.
The move follows a number of high-profile lateral hires at A&O in the past two weeks. In New York, M&A lawyer Daniel Cunningham is joining as a senior partner from Cravath Swaine & Moore. Capital markets lawyer Thomas Werlen is also joining as a partner form Davis Polk & Wardwell. And in Spain, A&O is taking on Iñigo Gómez-Jordana, a highly rated finance partner at Clifford Chance (see page nine).