You’ve got to hand it to Slaughter and May. At this rate the entire partnership will be millionaires, not just the ones at the top of the equity ladder. Just when Linklaters was catching up last year, it looks as if Slaughters will be pulling ahead again, with the mouthwatering prospect of £2.5m for each partner at the top of the equity.
That’s the optimistic prospect. For the first time, however, Slaughters partners are actually admitting the possibility of reaching that magic figure. And in classic Slaughters fashion, they’re also playing down the possibility, saying that current levels of corporate activity are not necessarily sustainable. In which case the poor lambs will have to make do with a little more than £2m each. (Whether top of equity touches £2m or £2.5m, it was politic to give the associates a bonus, but these figures will only make them want more.)
Linklaters has seen a rise in fee income of 22 per cent – in line with Freshfields Bruckhaus Deringer, which has also benefited from the M&A explosion.
This is where Slaughters’ lower cost base comes into its own. It doesn’t take a genius to work out that 30 per cent extra revenue is going to cascade straight into partners’ pockets. Because of this, sources at Slaughters – a firm that has no love for Linklaters – are predicting privately that they’ll be topping the tables again. “Unless Linklaters change their partnership structure around again,” sniffs a Slaughters partner.
In this context, Clifford Chance‘s 16 per cent rise at the half-year looks pretty tame. David Childs may be able to save £30m by shoving half of the back office out to India, but the firm is going to need a bit more than that to keep pace. It would give Clifford Chance no end of angst if Linklaters actually caught it up on turnover.
At the other end of the scale there are a couple of firms turning in woeful performances. Whispers coming out of Norton Rose say the firm is actually down at the half-year stage. Impeach the management, we say.
Actually, impeach the partnership, if it comes to that. Peter Martyr and his crew might want to spend a little less time banging on about the new building south of the river and a little more time getting in business. Even Hammonds – Hammonds! – managed to keep pace on the previous year.
If you can’t make money now, when can you?