In an ironic twist, the departure of Watson Farley & Williams’ Paris office to Orrick Herrington & Sutcliffe has resulted in the UK firm posting a slight increase in profits for the last financial year.
Profits per equity partner are up by 2.5 per cent on last year, hitting £357,000. However, revenue fell by 8 per cent to £48m.
A deal cut by Orrick when hiring the team, which included 7 partners and around 35 associates, effectively saw it buy all the work in progress for a sum believed to be around £2.5m-£3m.
It is also thought that the partners, one of whom was on top of the lockstep at 90 points, with another on 75, agreed to take lower returns on the last six months of work completed at Watson Farley to enable an early exit.
The lockstep at the UK firm is understood to have 14 stages, from 20 points throu-gh to 90. There is also a 5 per cent discretionary bonus.
The Lawyer understands that the team agreed to a pro-rata payment of around £5,000 per point, in comparison with up to £7,000 per point that the top partners could have otherwise taken.
Watson Farley managing partner Michael Greville declined to comment on the Orrick deal, but said: “The year end’s come out better than we’d expected, but not as good as we’d hoped.”