Shearman counts cost to Europe of King’s abdication
14 July 2008
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Several months before Shearman & Sterling corporate star Peter King quit for Weil Gotshal & Manges (The Lawyer,
7 July), a former Shearman London partner told The Lawyer: “If you look at US firms that are really strong in London, it tends to be the ones who have a good stream of corporate work from the US, like Skadden [Arps Slate Meagher & Flom], or are built up on private equity strength like Weil Gotshal.”
King’s departure to Weil represents more than just the loss of Shearman’s London corporate head. It could also cost the firm its dream of being a serious European – and transatlantic – contender. With no private equity strength in London, Shearman had relied heavily on King’s significant corporate mettle.
King was one of the last big names in Shearman’s London corporate practice, where the list of alumni includes Jonathan Coppin and Adrian Knight, who decamped to Hogan & Hartson and Skadden respectively in 2006 and 2005.
While former colleagues say King was never a rainmaker extraordinaire, they stress that he has a “brilliant mind” and that his loss will be significant. Perhaps especially as he was seen as the glue that held Shearman’s European network together.
A fluent speaker of both French and German, during his pre-Shearman years at Linklaters King spent a significant amount of time in Germany.
At Shearman he was the ideal diplomat to shuttle between London and Germany, and one of the few lawyers in the firm who could hold his own against the formidable force of Düsseldorf corporate partner Georg Thoma.
As one former Shearman partner says: “The relationship between London and Germany was pretty dysfunctional. Peter was one of the few who could bridge that gap.”
And while Shearman’s German presence has been troubled for some time – Düsseldorf-based global corporate head Rolf Koerfer defected to Allen & Overy earlier this year (TheLawyer.com, 10 January), while the 30-strong Mannheim office set itself up as an independent firm (TheLawyer.com, 22 April) – King’s departure will be felt there as well as
A partner at a rival firm in Germany says: “It’s not only a great loss for London, Peter King also had several outstanding client relationships in Germany.”
Among these clients are banks Depfa and Dresdner, which he took to Shearman from Linklaters in 2003.
Given King’s significance in London as well as Continental Europe, his departure to Weil makes Shearman’s global operation even more lopsided.
Nevertheless, its global heart keeps beating in banking and finance, especially in New York, where there have not been any partner-level defections in the past year. The firm’s US-Asia relationship also appears to be bearing some fruit, with Shearman recently acting on large corporate deals such as the HK$1.74bn (£112.8m) IPO of China Shanshui Cement Group.
In Europe, however, the firm’s corporate base appears to be crippled. Paris, which has not seen any partner promotions since 2005, suffers from corporate undercapacity and needs to grow. Italy boasts good names, but is not of a size that can make a significant impact.
In London the only big corporate names left are Laurence Levy and Lois Moore, 2006 laterals from Norton Rose and Freshfields Bruckhaus Deringer respectively. Their only partner-level back-up is James Comyn and George Karafotias, who were made up in 2007 and 2006 respectively.
The firm’s German presence, meanwhile, boasts a strong corporate practice under Thoma, but it has little finance capacity left following two partner departures in late 2007. The Germans have long complained about the shortage of corporate instructions from the US.
Outside the US, the firm is clearly troubled, but rather than face up to the seriousness of the situation, Shearman claims its European operations are robust.
London managing partner Anthony Ward says: “While there’s increasing movement in international law firms these days, we’re prepared for such contingencies. Our M&A group remains well positioned to meet the needs of our clients.”