Lehman Brothers

US investment bank Lehman Brothers is a name that will be familiar to most, if not all, major international companies as it has either funded or advised on some of the world’s most important deals.

Most recently in the US, Lehman Brothers underwrote a $5bn (£3.1bn) corporate bond deal for Wal-Mart, which the retail giant intends to use to fund its purchase of ASDA Group.

Closer to home, the UK legal team at the investment bank was part of a syndicate which helped finance Tecnost, Olivetti’s acquisition vehicle, on the hostile takeover of Telecom Italia.

Piers Le Marchant, European legal director at Lehman Brothers, says the Olivetti deal was the most exciting deal he has worked on this year.

He says: “We obviously deal with all the crises as well as putting all the deals together.

“It is an incredibly exciting part of the business because if you are working on a deal like the Olivetti takeover, it is as exciting as dealing with a crisis.”

Two lawyers in the 12-strong department were responsible for working on the deal.

Le Marchant says the legal departments based in each of the US parent company’s subsidiaries do not only work on the deals based in their region.

“There is coordination between the groups and there are two things that drive it. One is specialisation. A lawyer could be based in Japan or New York but be more specialised in a particular business area than a lawyer here. In that case the lawyer will be asked to assist on given matter.

“Secondly, other lawyers will be used just as a general resource. If there is a crisis out in Asia and there is a lack of resource then we may be asked to go out there and vice versa.

“Lawyers have to have a degree of flexibility to move in times where there are particular issues to deal with.”

This lack of boundaries is reflected in the way that the lawyers are not confined to one office but work within different business units.

“I believe that the lawyers need to be completely integrated with the business otherwise they don’t get a complete flow of things happening,” says Le Marchant.

The team works in four areas: fixed income, equity, private client services and investment banking.

Le Marchant says: “The principal ones are fixed income and equity in which we tend to have about four lawyers.”

He says this approach is different from most investment houses where each trading desk tends to hire its own lawyer rather than being centrally managed from one point.

“It has the advantage from a legal point of view that you see more of and are able to control more of the flow of business.”

In terms of external advisers, Le Marchant says: “We don’t use outside counsel that much and therefore we have a tendency to just use the larger firms.”

Freshfields is used mainly for litigation while the bank’s two lawyers in Frankfurt use Cleary Gottlieb Steen & Hamilton. Secretan Tryanov advises the bank in Zurich, where there is one in-house lawyer. All three lawyers report to Le Marchant.

Commenting on Clifford Chance and Linklaters, he says: “We tend to go to them firstly in relation to investment bank deals and secondly for all primary market transactions including share listings and bond issues.

“Thirdly we would tend to use them for the development of new products, which is a large part of our work.”

He adds that both firms would be employed to work on documentation which is distributed among clients, rather than a standard document, which would be handled in-house.
Piers Le Marchant
European legal director
Lehman Brothers

Statistics
Organisation Lehman Brothers
Sector Investment banking
Market capitalisation $7.1bn (£4.4bn)
Employees 1,200 in the UK, 9000 worldwide
Legal function 12 lawyers
Head of legal Piers Le Marchant
Reporting to Patricia Haas Cleveland, head of the corporate advisory division
Main location for lawyers London
Main law firms Clifford Chance, Linklaters & Alliance, Freshfields, Cleary Gottlieb Steen & Hamilton (Frankfurt), Secretan Tryanov (Zurich)