US firm Coudert Brothers has taken the City by surprise by taking over specialist London commercial property firm Debenham & Co this week and revealing that it is seeking a merger with a “top-tier” UK practice.
Couderts has struggled to make an impact on the City since it became the first US firm to establish a London multinational practice seven years ago and some observers have questioned the logic of its merger with the niche West End property firm.
But Couderts' London managing partner Philip Burroughs said the move signalled the beginning of further expansion plans by his firm.
He said his firm's global strategy was to have the same number of UK-qualified lawyers as US lawyers – a move which would mean a massive expansion of its English practice. He said the firm was seeking a merger with a major UK firm but scotched rumours that Couderts was currently in talks with Dibb Lupton Alsop. However, Burroughs disclosed that a Dibbs partner had approached his managing partner in New York two years ago to no avail.
He said Couderts was more interested in “first-tier” UK firms and only a lack of suitable candidates was holding his firm back.
The takeover of Debenhams will see six of its partners join Couderts' 10 London partners and two joining as consultants. Couderts' London office will now have 40 lawyers.
Burroughs said Debenhams was a “very significant” real estate firm, adding: “The real estate market is increasingly sophisticated, with funding coming from unusual sources such as the US capital markets. Debenhams had clients where we perceived opportunities.”
Debenhams senior partner Richard Woof said: ” Couderts' international finance and corporate capability, as well as access to the property expertise of a worldwide office network, will add the extra dimension we need.”
Couderts has lost several lawyers to London rivals in recent years culminating in the defection last year of six partners to US firm Morgan Lewis & Bockius' City office.
Robert Rakison, a partner at Morgan Lewis, said while it was “absolutely essential” for any international or US firm with “domestic pretensions” to have a strong property department, he was surprised Couderts “needed an entire property firm”.
He added: “While Debenhams is a very good firm, this is a strange signal to the market. It seems very, very domestic and parochial.”
Meanwhile, Couderts has extended its international practice into Canada by merging with Montreal firm McDougall Caron. It is thought that the 20-lawyer firm, practising under the Couderts name, will be the first foreign office practising domestic law in the country.