Latham leaves W&C Gulf plans in tatters
8 February 2010 | By Luke McLeod-Roberts
10 March 2014
4 March 2014
17 April 2013
22 October 2013
1 July 2013
White & Case is one of the biggest legal names in the Middle East with a reputation stemming back 50 years. But by the middle of this week it might be hard to recognise it as the same outfit that has been in growth mode for the past decade.
Last Monday (1 February) TheLawyer.com revealed that the firm’s Abu Dhabi and Riyadh heads, Villiers Terblanche and Mohammed Al-Sheikh respectively, had quit for Latham & Watkins.
They were joined by Abu Dhabi senior partner Nick Collins and partner Chris Langdon in Riyadh.
And a further four partners who work largely on Middle East matters - Craig Nethercott and Glen Ireland in London and Christopher Cross and Clement Fondufe in New York - have also quit to join Latham (TheLawyer. com, 1 February).
Four days later news broke that the Qatar head had followed in their wake (TheLawyer.com, 5 February). It is understood they will be accompanied by an estimated six of the eight associates and all of the support staff from Riyadh.
For a firm that only opened in Qatar in July last year and this year planned to double Abu Dhabi from 17 lawyers, the impact of such an exodus cannot be understated. Especially as many of the lawyers act for White & Case trophy client Saudi Aramco. The relationship was cemented in 2007 when the firm advised on Rabigh - Aramco’s $9.9bn (£6.27bn) joint venture with Sumitomo Chemicals - on which Nethercott, Cross, Al-Sheikh and Fondufe all acted.
One of the biggest concerns for White & Case will be whether it can hold on to Aramco and prevent it moving with the partners to Latham. The longevity of the relationship and the fact that it is historically managed out of New York, rather than Saudi, should help.
However, Aramco has a new general counsel, David Kultgen, with whom the trusted adviser role may not hold sway.
Philip Stopford, head of White & Case’s Western Europe, Middle East and Africa (Wemea) project and infrastructure finance group, says it would be “inappropriate to comment on individual clients”. However, he points out that the firm has “been in contact with our clients and we’re fully confident [their needs will] continue to be met by White & Case”.
Whether this is misplaced optimism is unclear. However, the fact remains that the firm has lost the heads of all of its Gulf offices and all its regional partners.
Ongoing work for Aramco and other major corporates such as Qatar Petroleum can arguably be staffed with bodies from the firm’s global network, but there is an immediate gap among the local senior relationship holders.
Stopford downplays this. “We’ve had such a long presence in the Middle East and such long involvement with many clients in the Middle East. It predates all of our offices,” he says.
However, one source points out: “Back in the 1950s, ’60s and ’70s nobody had a shop in the Middle East and it didn’t matter. Nowadays if you don’t have a solid, top-notch practice on the ground you’ll suffer.”
Nowhere is this truer than in Abu Dhabi and Saudi Arabia. Abu Dhabi authorities have stipulated that without a presence firms will not win government work (The Lawyer, 2 November 2009). And the emirate recently tightened the regulations on the operation of international firms’ offices, including a minimum lawyer requirement.
Stopford points out that White & Case has already responded by sending Singapore partner Doug Peel to Abu Dhabi and plans to send further projects lawyers there soon. The growth plans continue.
The situation in Saudi is slightly more complicated. International firms are not allowed to open alone, only in association with a local sponsor who is also a Saudi-qualified lawyer.
For most of the past decade the man who filled this position for White & Case was Mohammed Al-Sheikh. The tie-up was considered one of the most formidable in the region.
Al-Sheikh declined to comment when contacted for this article, but it is thought that he could be making the move to Latham as soon as this week.
Al-Sheikh’s departure leaves a big hole in White & Case’s Saudi practice that needs to be filled fast. Stopford admits that there is some urgency on this, but refers to it as a “logistical issue” more than anything else.
The man tipped to be the firm’s next sponsor is Turki Althunayan. He has been working part-time with White & Case for the past three years on a consultancy basis, a position he combines with teaching at King Saud University.
Althunayan is Saudi-qualified and has relationships with government entities. However, he does not have a licence, which can take up to a year to obtain.
Recruiters and local firms have already begun circling White & Case with the hope of clinching their own deals. But the pool of eligible Saudi sponsors is limited.
The question still remains as to why so many partners are leaving at the same time. The departure of the nine is not connected to the other four bank capital markets partners who also recently left for Latham (see this week’s City column, page 11).
However, insiders refer to “low morale and frustration with the [White & Case] leadership”, while others speculate on the financial rewards of swapping White & Case for white shoe.
Stopford says he does not want to speculate on why it has happened. Instead he says: “This is not a situation that we would have wanted to have happened. [But] we’re completely confident that our reputation in the region is assured.”
The general counsel of Aramco and others will be the judge of that.
MohammedAl-Sheikh - corporate group, head of Riyadh office, co-head of Islamic finance unit
Nick Collins - energy, infrastructure, project and asset finance group, Abu Dhabi
Christopher Cross - corporate group, New York
Clement Fondufe - energy, infrastructure and project finance group, New York
Glen Ireland - co-head of global mining and metals group, London
Villiers Terblanche -corporate group and head of Abu Dhabi
Christopher Langdon - projects group, Riyadh
Andrew Macklin - corporate group and head of Doha office
Craig Nethercott - energy, infrastructure, project and asset finance group, London, and co-head of Islamic finance unit