King & Wood Mallesons (KWM) will cut 15 per cent of its partnership in the UK, Europe and Middle East (EUME) as part of a “strategic restructure” of its operations in the region.
The restructure, which will see 23 partners leaving the firm, will predominantly affect partners in London and Germany although it will result in no office closures.
The review will also see 45 business services roles cut in London. No associate, paralegal or trainee jobs will be affected.
This latest review of KWM’s lawyer headcount comes less than a year after the firm cut around 10 per cent of its equity partnership across the same offices in 2015 and follows a year of flat revenue in the UK.
It also comes amid a change in strategy for the firm in the UK and EUME that will see the firm reorganise its 17 practice areas into three groups: corporate finance and funds; dispute resolution and regulation; and real estate.
Senior partner Stephen Kon told The Lawyer: “Although we’ve actively managed the partnership before, this is the first time we’ve restructured the partnership in this way.”
He added it was a “strategic and deliberate” decision and the response from the partnership, which was told the news today, was “a recognition that this is market driven”.
Global managing partner Stuart Fuller said: “After this restructure the firm will retain all the capability and quality it needs to serve both regional and global clients.
“We’ve looked at this from the perspective of the whole business. It will strengthen the firm and we expect that cross-border business will continue to increase,” Fuller added.
In a statement the firm said: “King & Wood Mallesons can confirm that it has completed a comprehensive, strategic review of its EUME business as part of its drive to become the global elite firm for the next century.
“As a result of the review, King & Wood Mallesons will restructure its EUME business to ensure it is well-position to be a key driver of the firm’s global success.”
KWM’s EUME offices are all legacy SJ Berwin bases. The firm merged with Chinese-headquartered King & Wood Mallesons in 2013 and operates as a Swiss verein with four separate partnerships – Australia, mainland China, Hong Kong, and the UK, Europe and Middle East.
Its offices in the UK, Europe and the Middle East have seen significant turmoil since the tie-up, with a number of senior departures and an office closure, as well as mounting pressure over delayed capital contributions to partners.
Most recently, EUME managing partner William Boss and COO Rachel Reid both stepped down from their roles at the start of this year. Boss will go back to fee-earning and Reid has joined Taylor Wessing. Neither has been replaced at the firm, with Fuller revealing last month it would put finding a new regional managing partner on hold until the end of the year.
KWM closed its Berlin office in May 2014 following a strategic review of its German practice and the departure of three partners to launch their own firms.
However the firm has increased its push into the Middle East market since the merger, opening in Riyadh in January 2014.
Headcount in Europe has risen in the last two years. Data from The Lawyer European 100 shows headcount across the firm’s continental European offices increased from 198 fee-earners in 2014 to 234 fee-earners last year.
Germany has the highest partner headcount on the continent with 20 partners. KWM also currently has 18 partners in France; 11 in Spain; five in Italy; four in Belgium; and three in Luxembourg.
In London, KWM currently has around 300 fee-earners including 93 partners.
The Lawyer interviewed Stuart Fuller and Stephen Kon in March with the pair sharing their plans for bringing stability back to the firm. Read the full interview here.