Allen & Overy (A&O) put a Canada launch on the back burner in 2011, choosing instead to focus on Australia. A&O’s future Toronto head reveals what was behind the change of heart.
When A&O’s Casablanca founding partner François Duquette voiced his intention to return to Canada nine months ago, the firm was left in a pickle. Here was a partner who had spearheaded A&O’s foray into Africa (20 July 2011) and helped launch its base in Abu Dhabi (18 June 2007) – from a management point of view, seeing him walk away was the last possible option.
But Canada was not on the firm’s agenda, either. It was only three years ago that senior partner David Morley put together a commercial study on Canada, with the firm sending fact-finding envoys out to talk with local firms (26 September 2011). In the end, A&O’s board rejected launch proposals so that the firm could focus instead on its Australia offices.
There was one loophole. According to insiders at the time, some partners remained open to the idea of an “inexpensive” opportunity, should that ever pop up.
And in comes Duquette. After months of talks the firm has put together a three-year plan in Toronto. It will launch a small and inexpensive satellite office, consisting of Duquette, one mid-level associate, and one member of support staff.
“The purpose is to seed the network,” emphasises Duquette, stressing that the base will only provide English law, focused on outbound investment.
”Canadian clients are becoming more and more international, so the idea is that I can continue serving my clients in Africa and the Middle East,” he adds.
Having opened offices in Africa and the Middle East (the latter with ex-Simmons Abu Dhabi head Ibrahim Mubaydeen), what are the lessons learnt?
”It’s about one step at a time, baby steps,” he replies, referring to the launch of A&O’s Casablanca and Abu Dhabi bases. “This is what I want to do in Toronto. There are some low-hanging fruits here [in Canada] in my view – a number of Canadian clients who previously invested in the US are now interested in more remote countries, they are looking at Africa and the Middle East.”
Perhaps in three years’ time, then, the office might look to expand. Should we expect to see a number of other international firms roll into Canada during this period?
Duquette says any rush of into Canada (a theory which was explored in 2012’s feature Before the Stampede) is “very unlikely” – it is a very well-lawyered country, he emphasises, with strong local firms and very deep relationships.
Indeed, A&O didn’t open a Toronto base because of client demand, nor to shake-up the local market. Duquette is simply moving home after 15 years abroad, and has managed to pluck out an appealing offer for A&O on the way.
“We really don’t want to break the current balance in the market,” he repeats. ”[Canada] is not a market like Casablanca, but it has great potential for the firm and is low-cost [the firm is renting a few desks from Regus rather than occupying an entire building]. One key to the recipe is controlling costs – this [launch] needs to be conservative.”