SJ Berwin emerges from the wings to make most of insolvency boom

THE BIGGEST insolvency jobs of this recession have fallen into two categories. First, major firms such as Freshfields Bruckhaus Deringer and Linklaters, both of which have made serious running in the financial sector and have a variety of bank collapses on their CVs. And, as The Lawyer reported earlier this year, the second category comprises traditional insolvency firms, such as DLA Piper, which have traded well off their heritage and close links to clearing banks.

All the more surprising, then, is SJ Berwin’s quiet rise in prominence over recent months. While the firm’s practice is best described as tidy, with nowhere near the depth of some of its mid-market rivals, it has, nevertheless, secured bit parts on some significant insolvencies.

Take the administration of Dunfermline Building Society, Scotland’s largest mutual (The Lawyer, 30 March). The biggest headlines on that deal inevitably belonged to Allen & Overy, which acted for Nationwide on the takeover, and to Freshfields Bruckhaus Deringer, which advised the administrators KPMG and the Bank of England.

But playing a bit part in the deal was SJ Berwin partner Mike Woollard, who, because of Freshfields’ role for the Bank of England, was brought in by KPMG partner Richard Heis specifically to advise on the implications of the new banking act, which had brought in a special regime for banks and building societies. Heis, who sits on the R3 technical committee with Woollard, needed someone who was up-to-speed.

“The new banking act was introduced about two days before the administration,” says Woollard. “It had never been used before.”

It was a classic example of how to keep your contacts warm. Woollard, along with fellow insolvency partner Jeremy Goldring, experienced the 1990s recession. Like many of the leading insolvency lawyers, each has been in practice for more than 30 years. (Goldring jokes that their combined experience would take them back to the 1930s depression.)

“I’d like to think we made the right call in recognising that insolvency practitioners would have their day again at some point, and we kept close to them,” says Goldring, who joined in July 2008 from Baker & McKenzie. “Back in the 1990s, lawyers would see them as people to market to and win work from, and that’s changed. Accountants started receiving work from lawyers. It’s been very difficult for us to buy them a lunch because they’d always want to pay.”

Prior to February this year SJ Berwin stayed mostly in the wings. Its role on MFI was brief, stemming from the shortlived management buyout prior to the insolvency. There had been a handful of other jobs ticking over, such as advising the joint administrators; administrators Zolfo Cooper (formerly Kroll) on parts of the sale of the assets of Plasmon; and advising Smith & Williamson on the administration of Pacific Continental Securities.

“We’re not bank driven,” admits Goldring. “Most of our work is not generated by bank panel relationships.”

And yet by far the most fruitful relationship has been with Landsbanki. Landsbanki was the main lender to Whittard of Chelsea, and Woollard got the nod on the prepack along with Ernst & Young. Similarly, Landsbanki was the main banker to Icelandic investment group Baugur, which made the firm a shoo-in for the group’s administration with Pricewaterhouse Coopers (The Lawyer, 5 Feburary).

SJ Berwin struggled throughout the 1990s and early part of this decade trying to make a name in the insolvency field. Its improved market position is generally agreed to date from the 2005 hire of Mike Woollard, a Hammonds veteran.

The second move was to shift insolvency out of the litigation practice two years ago and into the firm’s broader finance group, thereby creating a career structure with dedicated trainees. The group now has five associates and a proportionally large number of trainees – three at the moment, one of whom will be qualifying into the group in September. SJ Berwin is clearly predicting growth.