Is any lawyer worth busting your firm’s compensation structure for? Perhaps one with a reputation for being at the absolute pinnacle of their niche in the market?
This is the quandary with which Weil Gotshal & Manges was faced back in 2011, when it hired Linklaters’ partner Stephen Lucas to head its City banking practice. And it is the same one Kirkland & Ellis is likely to have wrangled with, leading up to its recent raid on Weil for the same partner exactly three years later (20 May 2014).
There is no doubt Lucas’ reputation precedes him. As one recruitment consultant puts it, “he’s an absolute superstar, the key superstar in finance in London”.
A key sponsor-side partner in the City agreed: “He’s a bit of a human dynamo. Lucas is highly prized in the market, not so much for his business but more for his profile and image. He has a great CV and reputation.”
Back in 2011 Weil pulled some strings to bring Lucas straight into the upper echelons of its pay structure, with a pay packet of more than $3.9m – reportedly less than the firm’s US management but more than its City office’s key players including London managing partner Mike Francies and co-head of the firm’s global private equity group Marco Compagnoni (31 May 2011).
However, as his three-year guarantee came to an end, Lucas once again set his sights onwards and upwards, ultimately settling on a substantial offer from Kirkland. It’s thought that the firm lured the partner by putting more than $4m on the table, with some sources suggesting that the total sum could even be double that figure.
News of the lateral move came as a shock to many, not only at Weil, where Lucas handed in his notice just last week, but at Kirkland, where a number of partners had no idea of the high-level negotiations that were unfolding.
It’s likely that the move isn’t purely about the money. Lucas joined Weil with the mandate of building out the firm’s borrower practice on the back of its private equity offering. He did this with some success, advising the likes of Advent on its leveraged buyout of KMD, and CBPE Capital on its minority investment in JTC Group.
Lucas also pulled off the hire of Freshfields Bruckhaus Deringer’s high yield chief Gil Strauss last year, in order to bulk up Weil’s City junior debt offering (7 December 2012). And just last month the firm announced it had poached Goldman Sachs star Andrew Wilkinson to boost its companies-side business via its restructuring practice (7 April 2014).
However, it’s not all been plain sailing at Weil over the past couple of years. The exit of private equity partner Mark Soundy, alongside tax partner Sarah Priestley and up-and-coming private equity associate Simon Burrows for Shearman & Sterling, left a dent in its sponsor-side practice, diluting the firm’s relationship with the likes of Arle, Bridgepoint and Permira (15 May 2013). As a response, it is understood that Lucas was encouraged to hedge the firm’s investment and take on an increasing amount of lender-side work.
Last year, for example, the partner took a lead for UBS, Credit Suisse, Goldman Sachs and Barclays on the financing for The Carlyle Group’s acquisition of Chesapeake’s packaging business, alongside the likes of Latham & Watkins and Slaughter and May.
Kirkland, on the other hand, has been seeking a big-hitting name to bolster its private equity offering on the banking side, sitting alongside the likes of European debt finance chief Stephen Gillespie and former Weil partner John Markland.
Lucas should be a good fit with Kirkland’s strong borrower-focused practice, which gets a particularly hefty chunk of its mandates from Bain Capital, but can also list the likes of 3i and Cinven on its client books. He is familiar with Kirkland’s London chief Graham White, having overlapped with the partner for a couple of years at their shared alumni firm Linklaters.
As the dust settles surrounding the move, Kirkland will be hoping that its newest partner was worth the bumper investment and this – this time – Lucas is in for the long haul.