Clifford Chance cash call was £60m” />Clifford Chance partners raised a total of £60m in their November cash call, The Lawyer can reveal.
The amount raised equates to an average of £150,000 per equity partner, not the £100,000 per partner as has been previously speculated.
Managing partner David Childs (pictured) told The Lawyer: “The finance director and I were looking at our level of capital over the summer. At the time we had no net borrowing, we had net cash, but turnover had risen by over a third since the previous capital call and so our capital looked light.”
The management was subsequently sanctioned by the partners to take the power to increase capital in tranches, but changed tack in October as the financial crisis took hold.
Childs said: “At that point we did a U-turn. We said if the banks were willing to give us the money now, then why not take the capital in one tranche?”
He added: “If it hadn’t been for the chaos in the markets in October then we wouldn’t have done it in one go. At any one time our net cash has exceeded our borrowings.”
According to the firm’s LLP accounts for 2007-08, members’ capital stood at £127m at the end of the last financial year. Its bank balance stood at £149m.
The bank facility arranged for partners is from several different lenders, but Childs declined to name them.
The news of the call emerged at the same time as the firm’s statement that it was making up to 80 lawyers redundant in London (8 January). Childs stressed that the two events were not directly related.