Sullivan & Cromwell is drawing up plans to launch its third office in China and its second on the mainland in an attempt to avoid over-stretching its operations in the country.
The US heavyweight already has a 14-lawyer office in Hong Kong and another site in Beijing, which has six lawyers.
Now the firm is looking to open an office in Shanghai to capitalise on the boom in work in the local area generated by multinationals establishing themselves in the city and a growing domestic client base.
Sullivan’s China managing partner Wei Chun confirmed that the firm was in the early stages of looking at opportunities in Shanghai. She said there was evidence that clients in Shanghai were increasingly requiring the firm to develop a local presence, a trend sparked by the current influx of international firms.
Sullivan services Shanghai-based clients primarily out of its two China offices, but is looking at a new outpost to avoid spreading itself too thinly.
“For law firms the concentration of resources and the efficiency of using those resources is key,” said Wei. “It is hard for us to spread these [resources] around unless there is a real strategic need. Thinking ahead, we are starting to look at Shanghai as a possibility.”
The process for opening a new office in Shanghai should be comparatively straightforward, Wei added, with no requirement for a new operating licence. “It is a matter of following the application procedure and getting approval from the Ministry of Justice,” she said.
Sullivan’s China practice has advised on a string of high-profile matters recently, including the $11bn (£5.93bn) Bank of China flotation earlier this year on which the firm advised the issuer.
The firm claims to have amassed more experience than any of its rivals in representing Chinese and Hong Kong issuers in SEC-registered and Rule 144a securities offerings, as measured by aggregate value of offerings between 1 January 1996 and 30 June 2006.