It’s been largely good news out of Germany recently. As the European 100 will show when it is published in a couple of weeks, the independent German firms all had a storming year with turnover up – mostly by a considerable margin – across the board.
And there have been quite a few hires by international firms in Germany recently too. Joining the recruitment roundabout in the past few weeks were Latham & Watkins and Allen & Overy (A&O). The former picked up A&O capital markets partner Okko Behrends, and then the latter turned to Shearman & Sterling for corporate partner Hans Diekmann.
But instead of looking for a replacement for Diekmann and other recent departures, Shearman’s response was to confirm the closure of its Düsseldorf and Munich offices.
The decision is a rare move out of Europe by an international firm at a time when many have been bulking up across the Continent. Shearman says it wants a more “elite” presence in Germany and plans to focus on high-end matters.
It’s a risky strategy. Although German firms had a great year, the German economy is relatively strong compared to its neighbours, and Germany is a focus for many UK firms’ international partner promotions, much of the work in the jurisdiction is now for mid-tier companies. High-end transactions, even in Germany, remain sparse, and Shearman will have a tough job making good on its strategic promise.