Firms advising Kingfisher are facing a tense couple of months as the retail giant begins its first panel review for more than two years.
The number of firms on the 10-strong panel is not expected to increase. But some firms could lose work, and even their place, when the review is completed in the autumn.
Freshfields is the FTSE-100 company’s main corporate adviser. It has acted on two of the group’s most recent deals – the failed £5.8bn bid for Asda last year and the merger of the B&Q chain with France’s leading DIY retailer Castorama in 1998.
Clifford Chance is the other magic circle firm on the panel. One lawyer claims the firm used to be the primary corporate adviser but now does property work.
Kingfisher is one of a handful of retail clients handled by Clifford Chance’s predominantly property finance department, which also acts for Safeway and Marks & Spencer in Europe.
Kingfisher group company secretary Helen Jones says: “It is a performance review and will gauge whether there are skills and services that we did not need before but do now.
“If there is a firm that has been on the panel that has not been getting the work for whatever reason there is a chance it could be replaced.”
The group also aims to establish two international panels. Jones says: “We are looking to repeat the exercise for France and Germany as they are countries that might benefit from their own panels. It will not be just the overseas offices of UK firms.”
Two years ago, four firms lost out to the current line-up. Jones will be talking to them with a view to them being potential replacements should any firms be dropped.
She adds: “It is not beyond the realms of the possible that [the panel number] will come down but it will certainly not go up.”
Jones points out that the review is not a cost-cutting exercise: “It is not that costs do not come into the equation but we are not doing this out of any desire to reduce legal spend.”