Allen & Overy (A&O) has shot to the top of the PFI league tables after completing projects worth a total of £12bn during the past five years.
The positioning is based on the latest cumulative statistics published in ‘The PFI Report’, which covers the past five years. Figures published six months earlier placed A&O behind Clifford Chance, Herbert Smith and Linklaters & Alliance in terms of capital value. Since then, A&O has completed six more projects, bringing it to a total of 39.
The firm’s ranking for capital value is based on recent projects such as the £832m Birmingham Northern Relief Road. This is the UK’s first toll motorway to be designed, built, financed and operated entirely by the private sector. Partner Anne Baldock led the A&O team advising the Bank of America and Abbey National Treasury Services as arrangers of the multimillion pound financing for the project.
Other headline deals include the £142m refurbishment of the Treasury Building in Westminster. A&O advised Ambac Assurance UK and the underwriters Warburg Dillon Read on the provision of an index-linked guaranteed secured project bond and a mezzanine facility to Exchequer Partnership, the selected bidder.
A&O has naturally built its reputation for PFI on its core strength in the banking and finance sector. Partner David Lee estimates that the firm’s PFI work is split evenly between financiers and bidders, but he adds: “One of the advantages of being a high-profile finance practice is that there is always the safety net of picking up financier work.”
The group does not trumpet its public sector work but has acted for clients such as the North of Scotland Water Authority. “You need that expertise. You need to know what makes the public sector tick,” says Lee. “When it comes to clients we’ve endorsed a policy of ensuring a good blend. This boosts our know-how and our reputation externally in the market.”
Close behind A&O in the rankings is Clifford Chance, which has developed particular strengths in the defence and transport sectors. Clifford Chance also ranks second for the number of signed deals its clients have been engaged in.
Last year’s projects include the £1.5bn refurbishment of the Ministry of Defence’s main building at Whitehall. Partner Andrew Rolfe led the team advising the project company Modus Services and its sponsors, Amey Ventures, Hyder Investments, Macquarie Infrastructure (UK) and Innisfree Partners. Rolfe says: “Those firms with significant finance practices in particular are well-placed to be involved in the large, complex deals, which always have complex financing arrangements behind them.”
At the other end of the adviser spectrum are key PFI players such as Eversheds, which beats the magic circle and other City players in terms of the number of signed projects it has worked on.
The firm is found mostly on smaller scale PFI projects, hence its low ranking for capital value, but last year worked on the first project in England and Wales to cover the entire school stock of a local education authority.
Partner Stephen Matthew led the team advising Stoke-on-Trent City Council on the £100m project to upgrade and maintain 120 schools. Clifford Chance advised the funding banks.