Tesco has dropped Ashurst as one of its preferred real estate firms, instead reinforcing its relationship with longstanding adviser Berwin Leighton Paisner (BLP)
In the past, Ashurst, BLP and Clyde & Co have picked up property mandates from the supermarket giant. However, Ashurst will no longer be instructed on real estate matters by Tesco, and Clyde & Co will see its instructions reduced.
It is thought that the decision is the result of an ongoing review of Tesco’s legal advisers, led by relatively new general counsel Adrian Morris, who joined from BP in September 2012 (9 November 2012).
It fits with the chain’s wider strategy of drawing back from further expansion in domestic markets. Last April, Tesco was forced to write off more than £800m of property assets, and admitted that almost half of its pipeline of development land was surplus to requirements.
Ashurst has picked up both corporate and real estate mandates from Tesco in recent years, including its acquisition and £50m development of Wolverhampton’s Royal Hospital in 2011. The firm also advised on its buyout of restaurant chain Giraffe for £48.6m last year (14 March 2013).
Meanwhile, Tesco has been a major client of BLP’s for more than 30 years. In May 2012, the firm’s former chair Peter Robinson took on a temporary secondment with the client as acting legal director of Tesco in China (18 May 2012).
It is understood that the firm’s new Manchester office, expected to open its doors in the summer, will be dealing with the bulk of the client’s work.