Top 30 International firms in London
2 April 2007
There are two new entries into this year’s table of the top 30 US firms in London by revenue.
Out go Arnold & Porter and Bryan Cave and in come Morrison & Foerster and O’Melveny & Myers, the latter like the proverbial rocket.
It is only three years since O’Melveny kick-started its UK offering by recruiting two private equity partners, Matthew Hudson and John Daghlian, the latter from SJ Berwin.
Since then, aided by the boom in private equity, the office has mushroomed.
Although still small at partner level, with only seven
currently on board, O’Melveny’s high leverage (the total lawyer headcount in the office is 50) has helped secure it a place among London’s leading US firms in record time.
Record growth is also on display at the other end of the table. As reported by The Lawyer (26 February), Mayer Brown Rowe & Maw and White & Case are the fastest-growing US firms in London, with the former’s UK revenue up by an impressive 21.8 per cent, from $145m (£79.67m) last year to $176.64m (£96m) and the latter’s up by a standout 38 per cent to $172.2m (£93.59m).
There is no doubting that 2006 was a boom year for US firms in the City. But for some, it was just that bit better than for others.
1 Baker & McKenzie
UK/global turnover*: £99.6m/£855.7m
Global profit per equity partner (PEP): £490,000
UK/global revenue per lawyer (RPL): £298,000/£278,000
Baker & McKenzie's London office saw revenue leap from £92m in 2005 to £99.6m for the 2006 financial year - an 8 per cent increase. Although UK average PEP was up by a healthy 16 per cent from £445,000 to £518,000, RPL plummeted by 20 per cent to £298,000 due to increased retention and a significant recruitment of assistants.
Transactional highlights for the firm include advising L'Oréal on its £652m takeover of The Body Shop and scooping Unilever's entire global trademark portfolio, beating more than 20 firms during the course of an eight-month tender process.
The firm continued to expand its banking and finance practice, hiring Linklaters partners Nick Tostivin and David Deck, as well as New York partner Laurence Pettit from White & Case.
*All figures are for year ended 30 June 2006
2 Mayer Brown Rowe & Maw
UK/global turnover: £96m/£589.13m
Global PEP: £616,000
UK/global RPL: £407,000/£426,000
Mayer Brown Rowe & Maw (MBRM) had another good year, with revenue in the UK rising by 21.8 per cent as a result of growth across all core practice areas.
The firm completed a strategic review in London earlier this year, which set targets to almost double turnover in London and to double headcount in the corporate and finance departments.
The firm has also overhauled its management, with UK head Paul Maher assuming the role of joint vice-chair. His influence in the firm as a whole is significant and is highlighted by London's strong financial performance since the transatlantic merger between Mayer Brown & Platt and Rowe & Maw at the beginning of 2002.
3 White & Case
UK/global turnover: £93.59m/£644.02m
Global PEP: £816,000
UK/global RPL: £319,000/£337,000
Firmwide, White & Case had an outstanding year, with turnover jumping by 13 per cent to £644.02m and average PEP by a very healthy 21 per cent to more than £800,000.
But the London office put even these impressive results in the shade by announcing a staggering 67 per cent hike in PEP to £693,000 and a 38 per cent increase in turnover.
All practice areas grew, according to London senior partner Peter Finlay. Notable instructions in 2006 included advising the banks on the £7.4bn financing for the cash portion of Mittal Steel's £17.6bn acquisition of French rival Arcelor.
The dramatic results are partly due to a poor performance in 2005, which was a result of an expensive office move and a lateral hiring spree.
Not that this has abated in 2006, with some notable partner hires in London including new co-head of corporate Philip Broke from Ashurst.
4 Latham & Watkins
UK/global turnover: £74m/£869.5m
Global PEP: £1.01m
UK/global RPL: £536,000/£444,000
Latham & Watkins had a solid year with 15 per cent growth in London. Growth of practices across the board necessitated the recruitment of a tax team, which Latham secured last year with the appointments of partners Sean Finn and Daniel Friel from Lovells.
The firm also reinforced its private equity and structured finance practices with a couple of strong hires. Partner Graeme Sloan joined from Maclay Murray & Spens with a client roster that included Candover, Bank of Scotland, Scottish Widows Investment Partnership and Dunedin Capital Partners.
The firm completed its year's recruitment with the hire of MBRM structured finance ace Mark Nicolaides. But it is not just at the top end that Latham is recruiting. The firm is starting to look more embedded in London after kicking off its UK trainee scheme last year.
5 Shearman & Sterling
UK/global turnover: £62.5m/£457.61m
Global PEP: £804,000
UK/global RPL: £534,000/£549,000
It was a disappointing year for Shearman & Sterling, which reported stagnant revenue figures both globally and in London.
Global average profit for the firm's 196 equity partners performed far better, up by almost 14 per cent to £804,000 from £714,000 in 2005. This result was generated off a global net profit of £157.61m in 2006.
But London fared less well, generating a profit of £19.57m, despite the office landing some choice instructions, such as the lead role in advising Nokia on its £10.97bn network merger with Siemens.
Shearman's disappointing London results follow a tough period for the office following a spate of partner losses, including rated corporate partner Jonathan Coppin's to Hogan & Hartson in July 2006. That said, the London office did swoop for Freshfields Bruckhaus Deringer co-head of dispute resolution Jo Rickard, who left because of Freshfields' pensions reform.
6 Sullivan & Cromwell
UK/global turnover: £57m/£500m
Global PEP: £1.52m
UK/global RPL: £870,000/£741,000
2006 was the year that Sullivan & Cromwell made its first direct attack on the London equity capital markets with the hire of Allen & Overy (A&O) corporate partner Vanessa Blackmore and a number of English-trained corporate associates. Previously Sullivan's English lawyers, who make up around 20 per cent of the total in the City office, were limited to project, acquisition and leveraged finance.
At the beginning of 2007, however, the US firm left no one in any doubt as to its ambitions when it hired M&A star Tim Emmerson from the London office of Milbank Tweed Hadley & McCloy. The firm also landed a place on Inbev's global panel, beating more than 30 contenders.
7 Sidley Austin
UK/global turnover: £55m/£676m
Global PEP: £708,000
UK/global RPL: £529,000/£388,000
Looking back on 2006, Sidley Austin's London managing partner Drew Scott picks out the structured finance practice as having had a "very strong year", advising on some "cutting-edge deals". One example was its work for Washington Mutual Bank, which saw the establishment of the first covered bond programme under US law.
Sidley also expanded its work for Deutsche Bank across mainland Europe. The firm's burgeoning insurance practice was boosted by the arrival of former barrister Dorothy Cory-Wright from Kendall Freeman. Scott predicted that her presence could provide the catalyst for a litigation practice in London.
8 Weil Gotshal & Manges
UK/global turnover: £53.26m/£576m
Global PEP: £1.03m
UK/global RPL: £626,000/£501,000
Weil Gotshal & Manges started the year with the trophy hire of Lovells partner Marco Compagnoni. The private equity hire was part of a bid to become a world leader in the area and number one in Europe.
Weil also hired Lovells senior assistant Jonathan Wood to its partnership and at the same time won consultant Alison Hampton, also from Lovells.
To underline its private equity ambitions, Weil parachuted in its co-head of US private equity James Westra and co-head of the global corporate group Barry Wolf with instructions to spend more time making headway in the UK.
UK/global turnover: £48.98m/£396.09m
Global PEP: £1.08m
UK/global RPL: £448,000/£429,000
Dechert has again reported robust revenue increases. The firm's global figure for 2006 show an increase from £315.93m in 2005 to £396.09m, a healthy rise of 27 per cent. UK revenue rose by 13 per cent to £48.98m from £43.85m.
The firm has identified competition as one of its target areas for London and demonstrated this with the hire of A&O telecoms partner Chris Watson, who joined Dechert's competition practice in February 2006. At the end of last year the firm also bolstered its UK office with the hire of real estate finance partner Kathleen O'Donnell, who joined from Lawrence Graham.
Weil's London office also lost corporate partner Graham Defries and capital markets partner Wayne Rapozo to Dechert.
10 Skadden Arps Slate Meagher & Flom
UK/global turnover: £48.97m/£1.03bn
Global PEP: £1.16m
UK/global RPL: £418,000/£516,000
Skadden Arps Slate Meagher & Flom's highestprofile matter last year was its lucrative mandate to defend Arcelor, the world's second-largest steel maker, against a hostile takeover by Mittal Steel, with the Skadden team being led by London-based corporate partner Scott Simpson. Lawyers from the firm's London and New York offices also advised on Nasdaq's £4.2bn informal cash bid for the London Stock Exchange. But despite these major projects, the firm increased UK turnover by a modest 4.6 per cent, from £46.8m to £48.97m.
11 Jones Day
UK/global turnover: £47m/£766m
Global PEP: £1.07m
UK/global RPL: £281,000/£344,000
After several years of consolidation, Jones Day London had a strong 2006, with financial performance rising back to the pre-merger Gouldens level.
The new confidence was underlined by several lateral hires into the employment tax and restructuring teams from Lovells, Denton Wilde Sapte (DWS) and Bingham McCutchen, as well as four homegrown partners being made up - the first for three years.
Work was strong across the board, with a smattering of cross-border restructurings, including acting for Dana globally on the largest Chapter 11 of 2006, and new investment bank mandates.
12 Cleary Gottlieb Steen & Hamilton
UK/global turnover: £40.48m/£451.1m
Global PEP: £1.14m
UK/global RPL: £555,000/£527,000
Cleary Gottlieb Steen & Hamilton's London office had a standout year, or at least played a key role on a standout transaction when it advised Mittal Steel on its successful e26.9bn (£18.16bn) acquisition of rival Arcelor.
Elsewhere, London lawyers featured on a string of IPOs, including Rosneft's controversial £5.8bn listing in July and Italian oil refining company Saras's ?2.1bn (£1.42bn) IPO in May.
The current year also got off to a flyer, with the firm bagging a lead role advising on the £4.43bn takeover offer by Airline Partners Australia for Qantas Airways.
13 Leboeuf Lamb Greene & MacRae
UK/global turnover: £35.86m/£260.53m
Global PEP: £777,000
UK/global RPL: £345,000/£373,000
LeBoeuf Lamb Greene & MacRae's London office posted one of the best returns in the market last year with a 35 per cent increase in turnover for 2006.
It marks the third successive year that the London office has increased revenue by at least 30 per cent.
The firm has hired aggressively around its core insurance and energy practices, with new recruits from Denton Wilde Sapte, Freshfields, Linklaters and Norton Rose.
LeBoeuf also added Dewey Ballantine rainmaker Camille Abousleiman in January 2007, but lost employment partner Peter Holt to Field Fisher Waterhouse (FFW) last October.
14 Kirkland & Ellis
UK/global turnover: £36m/£571m
Global PEP: £1.43m
UK/global RPL: £563,000/£454,000
An aggressive recruitment campaign in London marked out Kirkland & Ellis's 2006. The year started with the poaching of corporate tax specialist John Baldry from US rival Weil. But the raid that really turned heads in the City was Kirkland's capture of Linklaters global head of private equity Graham White and partner Raymond McKeeve. The pair subsequently went on to lure away one of their former firm's trophy clients, property tycoon Robert Tchenguiz.
Leading A&O banking partner Stephen Gillespie also swapped life in the magic circle for the Chicago-based firm.
But Kirkland did not have it all its own way and had to deal with the losses of London managing partner and founder Stuart Mills and corporate partner Nigel Dunmore.
On the deals side, Kirkland landed its first UK deal from Providence Equity Partners with the private equity firm's acquisition of Phones 4u owner The Caudwell Group.
15 Kirkpatrick & Lockhart Preston Gates Ellis
UK/global turnover: £30.3m/£271.5m
Global PEP: £424,000
UK/global RPL: £220,000/£318,000
Kirkpatrick & Lockhart Preston Gates Ellis, or K&L Gates as it prefers to be known these days, changed its name at the start of 2007 following the merger of US firm Preston Gates & Ellis with Kirkpatrick & Lockhart Nicholson Graham.
The figures, however, relate to the end of the firm's second year following its takeover of London mid-sizer Nicholson Graham & Jones, an event that also saw the end of a guaranteed fixed income for the legacy London equity partners.
Two years in and the firm appears to have settled well, the odd partner departure (such as technology specialist John Enstone to Faegre & Benson) notwithstanding. Average PEP rocketed by 28 per cent last year, from £308,000 in 2005 to £385,000. This was despite a drop in London's net profit because of increased costs, due in part to signing up for an additional four floors at its Cannon Street offices and significant investment in IT.
The additional costs meant that London's profit contribution to the firm's global profit pool dropped by around £2.5m.
16 Gibson Dunn & Crutcher
UK/global turnover: £29.76m/£439.66m
Global PEP: £951,000
UK/global RPL: £583,000/£491,000
US West Coast-headquartered Gibson Dunn & Crutcher's London office had a storming year in 2006, bettering the previous year's growth in terms of both headcount and turnover.
Globally the firm's revenue and average PEP increased by a steady 8.4 per cent and 7.1 per cent respectively, but London showed dramatic improvement, with revenue nearly doubling, from £15.6m in 2005 to £29.76m at the end of 2006 - an indication of the significant investment in people made the year before.
Growth in lawyer numbers in London did not stop, with 10 more added. New partners included associate Dorothee Fischer-Appelt from A&O, promoted on arrival, and employment partner James Cox from Ashurst, who launched Gibson Dunn's first UK employment practice.
But the firm did scrap its all-equity model in 2006, citing added flexibility in making lateral hires and promotions as the reason.
17 Davis Polk & Wardwell
UK/global turnover: £20.63m/£371.24m
Global PEP: £1.23m
UK/global RPL: £903,000/£599,000
2006 was another strong year for the London office of New York M&A machine Davis Polk & Wardwell, despite the office remaining without an English law capability. The office scored some superlative IPOs, including India's largest, the £3.93bn flotation of Reliance Petroleum, led by tax partner John Paton. London corporate partner Tom Reid also scored a headline Indian IPO with the flotation of Cairn Energy on the Bombay Stock Exchange.
PEP at the firm, which is one of the few to remain avowedly an all-equity partnership with lockstep remuneration, is now well above the £1m mark, giving London partners an average of £1.23m. But that prize is guarded jealously, with no promotions in London in 2006 and no lateral hires.
18 Debevoise & Plimpton
UK/global turnover: £28.41m/£312.5m
Global PEP: £981,000
UK/global RPL: £451,000/£484,000
Debevoise & Plimpton made good on its aim to strengthen its European litigation practice last year with the hire of Norton Rose's former global head of dispute resolution Peter Rees, who moved to the firm's London office.
Another solid year for M&A saw Debevoise's London team act on a £591m transaction, advising insurer Catlin Group on its acquisition of rival Wellington Underwriting. Corporate social responsibility was another focus, as the firm hired its first pro bono manager Florence Brocklesby for its London office fromFreshfields.
19 Simpson Thacher & Bartlett
UK/global turnover: £28.2m/£439.56m
Global PEP: £1.49m
UK/global RPL: £564,000/£651,000
Simpson Thacher & Bartlett moved to shore up its European representation of key client Kohlberg Kravis Roberts (KKR) at the end of 2005 with the hire of A&O banking partner Tony Keal, who advised the private equity house on all UK debt financings. The move appears to have reaped rewards, with Simpson landing the lead advisory role last May on KKR's plans to create and float an investment vehicle on the Amsterdam Stock Exchange.
Its US office continued to land roles on heavyweight deals, including advising Blackstone on its $36bn (£19.57bn) bid for the US's biggest landlord Equity Office Properties Trust.
20 McDermott Will & Emery
UK/global turnover: £28m/£467.33m
Global PEP: £761,000
UK/global RPL: £259,000/£458,000
In a year when personnel issues were to the fore at McDermott Will & Emery, with a number of high-profile arrivals and departures, it is ironic that one of the highest-profile exits was employment head Fraser Younson, who joined Berwin Leighton Paisner (BLP). Despite this setback the firm made a number of significant hires, including Hammonds' final departing Brussels partner José Rivas and the firm's UK competition head Alasdair Bell.
McDermott also underlined its desire to enter the structured finance arena with the hire of securitisation partner Paul-Michael Rebus from Bakers and Nick Terras from SJ Berwin.2007 will again see the firm dip into the recruitment market following the departure of pensions and incentives head Danny Tsang and his team to K&L Gates.
21 Cadwalader Wickersham & Taft
UK/global turnover: £28m/£302.17m
Global PEP: £2.8m
UK/global RPL: £560,000/£480,000
After a stellar 2005, when Cadwalader Wickersham & Taft turned over some £30m-plus, 2006 was slightly slower. The firm's mighty restructuring group was still dominant and continued to represent more than half of the London office's turnover. However, headline mandates on British Energy and TXU came to an end, meaning Cadwalader London had less of bumper year.
Turnover was around £28m, with at least £5m of that attributable to Eurotunnel work alone.
Restructuring aside, 2006 saw a renewed push into capital markets, the mainstay of the firm in the US. This followed the recruitment of collateralised debt obligation partner Angus Duncan from A&O and securitisation partner Christian Parker from Norton Rose.
22 Milbank Tweed Hadley & McCloy
UK/global turnover: £26.9m/£293.91m
Global PEP: £1.18m
UK/global RPL: £517,000/£604,000
Milbank Tweed Hadley & McCloy's global PEP rose by almost 15 per cent, from £1.04m in 2005 to £1.18m 12 months later. Global turnover also rose by a little more than 16 per cent to £293.91m in 2006.
The London office saw an increase in turnover of around 9 per cent, with the office posting a turnover of £26.9m in 2006.
Milbank London managing partner Phil Fletcher said that, while the office's projects team had had a strong year, with an increased focus on Middle East and African projects work, the firm's outsourcing and leveraged finance departments represented the most significant growth. Fletcher added that the IP litigation practice also continued to be "very steady".
UK/global turnover: £25.1m/£487.5m
Global PEP: £533,000
UK/global RPL: £448,000/£478,000
The recent turbulence in WilmerHale's UK operations, which saw a team of three highly rated corporate partners decamp for Heller Ehrman, followed quickly by a tax partner and two senior associates, as well as the closure of its outpost in Oxford, is not hinted at in its year-end figures.
Globally the firm saw revenue increase by 10 per cent, from £447.8m to £543.48m.
But its London arm, which includes Oxford, did far better. Here revenue grew from £21.43m to £25.2m, a rise of 19 per cent.
A string of major matters, including the £230m sale of Domantis to GlaxoSmithKline, the CTC Media IPO and Lufthansa's air cargo arbitration, kept the cash rolling in to the firm's City office.
The current year may not exactly have got off to the start it would have wanted, but the firm that has been in London since 1973 is not about to leave.
24 Reed Smith
UK/global turnover: £24.89m/£349.79m
Global PEP: £512,000
UK/global RPL: £315,000/£377,000
Reed Smith's big project last year was its merger with Richards Butler. The firm's UK turnover will be boosted next year by around £50m-£60m from Richards Butler, instantly making it one of the largest US firms in London.
The Lawyer revealed Reed Smith's merger with the UK firm in April 2006, after which the two firms went full steam ahead to finalise the link-up on 1 January 2007.
The deal will particularly boost Reed Smith's litigation team, which currently accounts for around a third of UK turnover; corporate accounts for 36.4 per cent of UK turnover.
The firm's corporate successes have mainly been focused on AIM, with a strong niche in the pharmaceutical and life sciences sectors.
25 Hogan & Hartson
UK/global turnover: £23.4m/£410.33m
Global PEP: £543,000
UK/global RPL: £498,000/£415,000
Hogan & Hartson's London office made one of the highest-profile US lateral hires of the year in 2006 when it swooped on Shearman to snare M&A partner Jonathan Coppin.
Coppin now heads Hogan's developing London M&A and corporate practice, a group that saw some significant successes last year, including advising Norilsk Nickel on its £222m cash acquisition of OM Group's nickel business and Russian car manufacturer GAZ's purchase of UK-based LDV Holdings.
Earlier this year the Washington DC-based firm also outlined its plans to import its market-leading US real estate investment trusts practice into London to capitalise on the UK's introduction of listed property investment companies.
26 Dewey Ballantine
UK/global turnover: £22.37m/£222.01m
Global PEP: £788,000
UK/global RPL: £508,000/£445,000
The headline news for New York firm Dewey Ballantine was its much reported proposed and failed merger with West Coast firm Orrick Herrington & Sutcliffe. The firm was hit with a spate of departures after the merger talks were announced, but the London office was largely spared in 2006, with the exits of capital markets partners Camille Absouleiman and Louise Roman Bernstein to LeBoeuf coming in January this year.
In 2006, while still at Dewey, Absouleiman advised on the largest-ever IPO in the Middle East for Telecom Egypt, the first-ever Dubai International Financial Exchange flotation and the subsequent largest IPO in the Middle East.
The London office also lost two partners to BLP early in the year, but won two new corporate finance lawyers, Joseph Marx and Stephen Jurgensen, from US rivals White & Case and Shearman respectively, who were promoted to partner upon their arrival.
27 Bingham McCutchen
UK/global turnover: £16.96m/£372.88mGlobal PEP: £663,000UK/global RPL: £435,000/£415,000
Bingham McCutchen posted strong numbers in 2006, reaping a UK turnover of £16.96m, an increase of slightly more than 42 per cent on the previous year's £12.07m.
However, in 2006 UK PEP stood at £783,000, down from 2005's £802,000. This was higher than the firm's global PEP, though, which stood static at £663,000.
Bingham London managing partner James Roome said the increase in UK turnover was partly attributable to the increase in the number of partners in London.
He added that the firm's financial restructuring, financial regulatory and corporate groups had seen a "particularly solid" year.
28 O'Melveny & Myers
UK/global turnover: £16.85m/£472.23m
Global PEP: £883,000
UK/global RPL: £337,000/£449,000
O'Melveny & Myers' storming entry into the London market three years ago has led to it securing a berth within the top 30 US firms in the City.
The remarkable performance was built on a platform of private equity fund formation and was spearheaded by former SJ Berwin partners John Daghlian and Matthew Hudson, who founded the office in 2004.
Last year saw the London office's strong performance continue with mandates for major US clients Apollo and Coller Capital, as well as a role on the £10.3bn takeover of BAA by Spanish construction giant Grupo Ferrovial.
29 Morrison & Foerster
UK/global turnover: £15.9m/£420.65m
Global PEP: £614,0000
UK/global RPL: £338,000/£416,000
San Francisco's Morrison & Foerster (Mofo) continues to grow in London despite the firm beginning 2006 with the loss of two partners - corporate partner Neil Foster and technology partner David Naylor, who both joined FFW.
The losses followed a hiring spree in 2005, which included the capture of a corporate team from Weil and a technology and outsourcing team from Shaw Pittman.
The firm bolstered its UK outsourcing practice further with the hire of Lawrence Graham partner Jon Edgell in mid-2006 and Ashurst partner Tim Coulter at the beginning of 2007.
The corporate practice, meanwhile, moves from strength to strength, with partners James Gubbins and Paul Claydon securing a string of life sciences deals.
MoFo also launched a limited trainee programme last year and started a structured finance practice with the hire of two former Freshfields partners at the beginning of 2007.
30 Covington & Burling
UK/global turnover: £15.2m/£221.73m
Global PEP: £590,000
UK/global RPL: £608,000/£388,000
It was a solid year for Covington & Burling's London office with increases in gross revenue, RPL and profit. The all-equity firm operates primarily in dollars, even in London, as the global profit pool is in dollars. As London head Ed Britton puts it: "The exchange rate is one of those things you have to accept as part of life."
During the past year Covington added capability in tax, hiring former Linklaters and O'Melveny lawyer Guy Bingley as of counsel. The firm also promoted three partners, two in corporate and one in food and drugs regulatory.
Deal highlights for the year included a number of AIM listings, including Baltic Oil Terminals, and the £1.74bn acquisition by Oshkosh Trucks of longstanding client JLG Industries, the world's number two manufacturer of mobile aerial work platforms.