The Leader Column

It is perhaps symptomatic of the frenzy gripping the Italian legal market that Il Mondo magazine last week joined Linklaters with a new prospective merger partner, Pavia e Ansaldo.
Finely tuned to a market with an insatiable appetite for gossip, the magazine honed in on speculation that Linklaters’ new, revised agreement with long-term ally Gianni Origoni is much looser than its old tie. Thus, Linklaters has left the door open for a new joint venture with a firm more disposed to the idea of a takeover than Gianni. Or so the story goes.
Pavia might prove to be a more malleable ally. Raided by international firms and deserted by key finance partner Gian Paolo Zini, it is probably feeling the heat more than Gianni. Talks with Herbert Smith have yet to produce a deal.
Linklaters denies any infidelity. “Absolute cobblers,” says Anthony Cann. “Utter tripe.” Anyone will tell you that Gianni will never merge, but Cann says he has extracted a promise to review the prospect of merger in two years time.
True or false, the Il Mondo story speaks volumes about the urgency with which international firms are trying to crack Italy. Team hires are the new method. After all, the pursuit of joint ventures starts looking risky when even Clifford Chance’s merger partner walks out the door.
Latham and Shearman are tipped to be close to hiring dozens of Italian lawyers. Sullivan & Cromwell has been trying hard to break in, as has Sidley. Earlier this month Orrick beat them to it when negotiations finally came off in the shape of a team led by Alessandro De Nicola, a founding partner of Ernst & Young’s Italian legal arm.
So why this sudden hurry? For a start, a market overcrowded with small law firms makes Italy ripe for a more concerted Anglo-Saxon invasion. The merger of Olivetti and Telecom Italia has offered a tantalising appetiser of the work that could be on offer; the Italian government takes an active role in the securitisation market and is generating masses of project finance work with its infrastructure plans. Add to that a bunch of imminent changes to Italy’s corporate laws and you have an enticing melting pot.
Further down the line a new tax regime being masterminded by finance minister Giulio Tremonti promises to make Italy more attractive to international companies. What else would you expect from someone who previously ran his own tax law firm?