Ship-shape with Bristol passion
17 November 1998
Alison Laferla says Bristol's legal market is booming but competition among local firms is becoming increasingly cut-throat.
They used to call Bristol the graveyard of ambition. Today, for lawyers at least, the description seems absurd.
After years of unfulfilled potential, Bristol is shaking off its sleepy image and reinventing itself as a thriving centre for financial and legal services.
With major institutions such as Lloyds Bank and the Bristol & West Building Society locating their head offices in the city, and developments like the Cribbs Causeway shopping centre and the #600m harbourside redevelopment project, the local economy is picking up.
This is good news for law firms in the city, who talk about handling big corporate deals and acting for large PLCs and multinationals.
Perhaps the strongest testimony to Bristol's legal growth is the interest shown by law firms outside the city.
Over the past four years Somerset firm Clarke Willmott & Clarke has worked hard to reinvent itself as a Bristol-centred commercial specialist, opening an office on the waterside two years ago.
Eversheds opened a Bristol office in 1994 and, as The Lawyer revealed last week, is eying local firm Veale Wasbrough for a merger. Bond Pearce moved into the city earlier this year and Cameron McKenna has beefed up its three-partner Bristol office with the launch of a corporate practice.
But these developments have not seriously ruffled the feathers of Bristol's two leading firms, Osborne Clarke and Burges Salmon.
Both firms have recently enjoyed sustained growth, with an increase in fee-income of approximately 30 per cent in 1997.
Osborne Clarke now regularly acts on deals which are worth in the region of a quarter of a billion pounds. With offices in London and Reading (or Thames Valley as it chooses to call it), a profit-sharing agreement with a major German firm, alliances with several other European firms and plans to expand, Osborne Clarke seems ready to take on the world. But, the firm's partners say, its soul remains firmly in Bristol.
Burges Salmon's single-office practice has doubled in size to 154 lawyers in the past five years. The firm sees itself as a "heavyweight national player that just happens to be based in Bristol" and highlights transport, PFI, commercial property and corporate work as strong growth areas.
Summing up the Bristol scene, managing partner Guy Stobart says: "There are two commercial law firms in Bristol, and they are Burges Salmon and Osborne Clarke. All the others are a long, long way behind. That's not to say they are not doing good work, but it pales into insignificance in comparison."
But other firms in Bristol have also been doing quite nicely in recent months.
Osborne Clarke's managing partner, Leslie Perrin, says most firms in Bristol have posted their best ever results during the last tax year.
Although this is partly to do with growth in the local economy, it is mainly attributed to the success of several Bristol firms in becoming leading national players in their specialist areas.
Bevan Ashford, for example, is renowned for healthcare work, Cartwrights is very strong on licensing, Lyons Davidson is known for its insurance work and Veale Wasbrough is a leader in central and local government work and education.
Cartwrights managing partner Christopher Eskell explains: "There isn't a significant manufacturing base in the area and sizeable firms are unable to achieve growth within the confines of the city itself. They have tended to build up specialisms and become respected in those fields, so location is less of a problem. A lot of firms are servicing clients way outside their area."
The trick is for firms to be able to build business off the back of their niche areas.
Nick Jarrett-Kerr, chairman of Bevan Ashford, says: "We don't want to be caught in a niche. Our plan is to keep on being famous in the national health sector but to work off that into other areas, such as PFI work.
"We've been trying to grow teams, using our public sector work as a way of building deep teams whose expertise can then be sold into the private sector."
David Pester, corporate partner at Lawrence Tucketts, says Bristol firms are undoubtedly competing more with London now. "We find that the market in Bristol is so competitive that we have had to expand our client base nationally. In a number of niche areas we are competing head-to-head with London, where our cost-effectiveness is not a problem."
Despite having their own niche strengths, other Bristol firms agree that the local marketplace is highly competitive, particularly in employment, financial and commercial work.
Older firms are still trying to assess the impact of the newer arrivals in the city and there is a lot of jostling for position.
As one Bristol lawyer puts it: "We have the usual mutual admiration pact which breaks down under the slightest provocation."
Lawrence Tucketts is clear about wanting to be the alternative to Burgess Salmon and Osborne Clarke for corporate work.
Clarke Wilmott & Clarke has ambitions to become the third biggest commercial practice in Bristol. Michael Clarke, chairman of the rapidly expanding firm, is quick to place it in the "premier division of regional firms".
Jarrett-Kerr at Bevan Ashford admits that Lawrence Tucketts and Clarke Willmott & Clarke have done much to catch up with his firm on corporate work.
But he says: "Although size isn't everything, there is quite a difference in size between the top three firms and the rest. We have 232 people in our office in Bristol. That's not far off Osborne Clarke and Burges Salmon, and is a whole lot bigger that Cameron McKenna, Tucketts, Clarke Wilmott & Clarke and so on."
Everybody is waiting to see what Bond Pearce intends to do with its new Bristol presence. Senior partner Nigel Theyer says the office was opened to meet client demand in insurance, banking and insolvency work. He anticipates the five partner office will grow but says the firm does not plan to make Bristol its main office.
Observers of the Bristol legal scene, however, say it will not be long before Bond Pearce is trading punches with the likes of Burges Salmon.
Simon Pizzey, Veale Wasbrough's new managing partner, says his firm has not felt any difference because of new firms moving in.
"Bristol is not an easy market for incoming firms to work in. Historically those who have come have tended to work in limited areas and that, it seems to me, is the way it still is."
The increased competition between local firms has also resulted in greater movement of staff between them, something which 10 years ago was considered very unusual.
The defection of corporate partners Patrick Graves and Paul Cooper from Bevan Ashford to Osborne Clarke 18 months ago marked what many see as a new era of "chequebook mobility". In turn Bevan Ashford recruited Veale Wasbrough's top corporate partners Stuart Whitfield and Nigel Campbell.
Other inter-Bristol moves are said to be on the cards.
"Before Paul and Patrick there was not much movement between Bristol firms," says Jarrett-Kerr at Bevan Ashford.
"There was a little bit of people leaving to go to London, but in Bristol itself there hadn't been that much. It is now happening much more. I think it is partly a sort of shake-out of the industry, in which there will be winners and losers. Are there going to be any more? Undoubtedly there will."
As one senior lawyer puts it: "These days people are always on the lookout. We are getting people to phone us up and there is plenty of whispering going on. We joke about wearing red carnations and standing behind the potted plant at the Royal Swallow Hotel, waiting for somebody to contact us with terms."
In fact, the advice from one old Bristol firm to the "newcomers" - Eversheds, Bond Pearce and Clarke Willmott & Clarke - is that they need to poach local talent to build up their practice.
The buoyancy of Bristol firms at the moment is reflected in plans for yet more expansion. Clarke Willmott & Clarke, which is developing its property practice in the Midlands, is looking to expand further in the South West, most likely in the north and east of the region, and is involved in "gentle" merger talks with a number of firms.
Lawrence Tucketts says it is working on acquiring the sort of critical mass needed to take on Burges Salmon and Osborne Clarke head to head.
Bevan Ashford plans to make its mark in London through the office it opened there earlier this year, and does not rule out the possibility of opening an office in the Midlands.
"Bristol has huge potential," says Michael Clarke. "It already demonstrates a very strong commercial base and I think that will continue to grow."