Magic circle loses out in FTSE 100 promotions

The magic circle has seen its share of the FTSE 100 plummet with the latest round of promotions and demotions from the list.
The eight companies that are losing their positions in the FTSE 100 are: Carlton Communications, Misys, CMG, Colt Telecom, Telewest Communications, Energis, Spirent, and Marconi. Almost all boast magic circle firms as their main advisers.
Only Colt Telecom falls out of the list without a magic circle adviser, instead relying on Baker & McKenzie and DLA.
Of the eight companies that are moving up into the FTSE 100 in their place, the majority rely on firms outside the magic circle for their legal advice.
Herbert Smith has seen two of its corporate clients - Friends Provident and Enterprise Oil - move up into the top flight. In May, the firm advised Friends Provident on its £4.2bn demutualisation and flotation.
Herbert Smith corporate partner Michael Walter said that the boost to the firm's FTSE 100 profile was significant. He said: "FTSE 100 companies are all much bigger companies with much bigger businesses, generally speaking, and so they have a greater need for legal advice. We're quite keen on maximising our share of the FTSE 100 and indeed the FTSE 250."
But Colin Taylor, director of compliance and legal services at newly-promoted Northern Rock, said that it is business as usual.
His advisers include Allen & Overy for capital markets work, Freshfields Bruckhaus Deringer and DLA.
Taylor said: "From our point of view it's not going to make any difference in relation to the services we use. It's really what we've done in the past that has got us to where we are now. We regard it as a pat on the back for the way we have run the business so far."
He added: "There is an argument that your share price becomes a bit more stable when you get into the FTSE 100 - that remains to be seen."
Other firms to have gained from the promotions include Pinsent Curtis Biddle, which advises Severn Trent, and SJ Berwin, which advises the British Land Company.
Walter said: "From a company point of view they're more able to do deals because their market cap has grown, their paper is worth more and they're able to fund transactions with paper. Generally the ability to do deals is greater."

FTSE 100 - the winners and losers
Who's in...	Main advisers
Friends Provident	Herbert Smith, Norton Rose
Enterprise Oil	Herbert Smith, Allen & Overy
Wolseley	N/A
Severn Trent	Pinsent Curtis Biddle
British Land	SJ Berwin, Ashurst Morris Crisp, Berwin Leighton Paisner, Simmons & Simmons
Man Group	Ashurst Morris Crisp
Northern Rock	Freshfields Bruckhaus Deringer, Allen & Overy, DLA, Eversheds
Innogy Holdings	Linklaters & Alliance
Who's out...	Main advisers
Carlton	Slaughter and May, Macfarlanes
Misys	Allen & Overy, Pinsent Curtis Biddle
CMG	Linklaters & Alliance, DLA
Colt Telecom	Baker & McKenzie, DLA, Field Fisher Waterhouse, Shepherd & Wedderburn
Telewest	Freshfields Bruckhaus Deringer, Lovells, Simmons & Simmons, Weil Gotshal & Manges, Olswang, Field Fisher Waterhouse, Wiggin & Co, D Young
Marconi	Allen & Overy
Energis	Clifford Chance, Denton Wilde Sapte, Pinsent Curtis Biddle
Spirent	Linklaters & Alliance, Debevoise & Plimpton, Goulston & Storrs