Cleary Gottlieb Steen & Hamilton is making Hong Kong its strategic focus for the current financial year with a series of lateral hires planned for the jurisdiction.
The firm, which is also looking to bulk up in London and New York, is famed for its cautious approach and rarely makes hires, but has emerged from the recession in a confident position after seeing its turnover and average profit per equity partner (PEP) remain stable in 2009.
While Cleary has an established China practice in Beijing, a key priority is to now supplement that by bringing in a corporate lawyer to strengthen its Hong Kong office.
London partner Glen Scarcliffe told The Lawyer: “We intend to add a Hong Kong law practice focused on equity capital markets and M&A, and are in the process of looking for a good quality lateral partner to help us start that practice up by working closely with the capital markets and M&A partners already in our Hong Kong office, all of whom are, or are about to be, admitted in Hong Kong.”
Cleary is also keen to beef up its US litigation practice and is on the lookout for ’star’ practitioners.
“We’ve been fortunate to recently acquire two excellent laterals in the US and we intend to continue to grow our litigation practice, primarily organically, but we’re always interested in ’stars’ who would be a good cultural fit for it,” added Scarcliffe.
The firm currently has nine litigation partners in its US offices who are former federal prosecutors and focus on areas such as securities enforcement and internal investigations.
Its London litigation team, however, is less well established. In February it poached Simmons & Simmons finance litigation head Jonathan Kelly, but Cleary is eager to bring in another litigator to support him.
“It’s a first step; we know we need a second litigator,” said Scarcliffe. “Jonathan’s the senior partner. We need a more junior partner to come in as soon as possible.”
The firm will also continue to ponder its Middle East future. It does not have an office in the region but Scarcliffe said: “We continue to think hard about the Middle East. We have a very broad client base in the region and it’s a very important region for us.”
Cleary fared better than many of its US rivals during the downturn, with its estimated global revenue falling by only $4m (£2.65m) to $965m in the last financial year, while global PEP remained static at $2.3m.
It also avoided the widespread restructuring witnessed at other US firms. Scarcliffe believes this is because of Cleary’s flat management structure, lockstep remuneration and, more importantly, its ’steady as she goes’ approach.
“It seems to me that the real benefit of lockstep is that you find the best lawyer to do the deal, creating a culture in which lawyers work together, communicate better and provide a better service to the client,” he explains.
Like Slaughter and May, Cleary discourages its lawyers from specialising in narrow areas of law and instead prefers a much broader approach.
This meant that when the downturn kicked in the firm was able to take lawyers from capital markets and finance teams and move them onto restructuring and insolvency matters.
But despite the talk of lateral hires, it is fair to assume the firm will not be throwing caution to the wind any time soon.
“It’s a case of steady as she goes,” said Scarcliffe. “We don’t seek to ride the crest of every huge wave with great expansion as some other firms do, but then we don’t suffer the troughs like some others did during the downturn, when they had to behave like an investment bank in contracting severely by laying people off.
“We’ve developed more slowly and cautiously, perhaps because we have a natural comfort with organic growth.”