White & Case’s decision to deploy a number of London-based lawyers in Africa is a useful way of dealing with some of its issues in the City, but it is also a good strategy in a wider context.
White& Case’s decision to deploy a number of London-based lawyers in Africa is a useful way of dealing with some of its issues in the City, but it is also a good strategy in a wider context.
Like many other firms, White & Case is taking steps to cut back its global headcount, with up to 400 job losses expected to be announced.
Redeploying lawyers to busier offices has been a theme over the past year (White & Case sent London partner Jonathan Weinberg to Prague last month), but with work slowing across the globe, the scope for this has now been largely exhausted.
Africa, though, is still a reasonably untapped market and White & Case already has a presence in Johannesburg.
As one partner at another firm with a presence in Africa says: “White & Case is emphasising the importance of Africa. They’ve been there for a long time.
“They’ve made money from Johannesburg and this is a further commitment to the continent by White & Case.”
The firm will be focusing its efforts on specific African nations, with Angola, Kenya, Mozambique, Nigeria and Uganda all priorities.
The significance of Africa for the future of the legal sector has not been missed by the Law Society and, writing for The Lawyer last week, former president and Law Society Council member Andrew Holroyd said the body is focusing on nurturing the relationship between UK law firms and their counterparts in Nigeria.
“For law firms, diversifying through overseas activity can be an effective way of coming through this slowdown,” he said. “Although the impact of the financial crisis has been felt in Nigeria, as it has in other African markets despite predictions to the contrary, Nigeria remains an attractive market following reforms in the banking and insurance sectors.
“It cannot be denied that the country has been exposed, albeit indirectly, to the fallout from the collapse of the debt markets. A reduction in direct investment from overseas, drops in oil prices and the continued violence in the Delta region have made Nigeria less attractive than a year or so ago.”
That said, Holroyd added: “Compared with the rest of the world, Nigeria is well placed and is even showing the shoots of recovery that other economies the world over are dreaming of.”
This is a view shared by Denton Wilde Sapte Africa practice director Paul Bugingo, who has been working on the continent for the past 10 years.
Dentons was an early mover into Africa and operates there via tie-ups with 10 regional firms.
According to Bugingo, this model is rising in popularity among international firms looking to tap into the lucrative work coming out of Africa.
“Some firms are looking to build links with a leading firm on the ground – DLA Piper’s done that and we’re seeing Eversheds doing that in Johannesburg,” says Bugingo. “It’s probably more popular now to have alliances with local firms, which are good.
“That’s a major point – there are very good local firms, and rather than setting up to compete with them, it makes sense to work with them and develop strong links.”
But while there are 52 countries in Africa, Bugingo points out that, for international firms seeking alliance partners, some countries may not offer many firms to choose from.
“In some countries, like Nigeria or Kenya, there’s a lot of options,” he says. “In others there might just be one or two suitable firms, but they’re the ones that won’t have the greatest attraction for international law firms because there’s not so much work there.”
However, with Africa shaping up to be the hottest emerging market, perhaps these less-established nations are where firms trying to break into the region should look to build presences.
As Bugingo points out, Dentons formed an alliance in Tanzania when there were just two suitable firms. Now, he says, there are four or five.
While White & Case’s decision to up its focus on Africa may be driven out of necessity, it could be exactly what the firm needs to guide it through the recession. But, with failed ventures in Italy and Germany behind it, the firm will need to chart its course with care.