Value range – as the money pours in, can Israel takes its high-growth stars global?

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Israel’s regional tensions contrast with optimistic hopes for foreign investment and a burgeoning economy. While war still rages over the border in nearby Syria, Israel’s start-up and hi-tech sector is flourishing. In addition, its nascent natural gas industry finally looks primed for substantial development.

Life is good in Israel’s commercial capital Tel Aviv, says Barry Levenfeld, a partner at Yigal Arnon & Co: ‘Economically and politically, Israel remains stable, while our neighbours are more dangerous by the minute. Sitting here on the 47th floor in Tel Aviv, looking across the Mediterranean and with all the restaurants and coffee houses below, you just wouldn’t know that any of this was going on.’ Continue reading “Value range – as the money pours in, can Israel takes its high-growth stars global?”

Red dragon, white cross – Can Chinese money kickstart Swiss markets

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‘In our worldwide business, the volume of mergers is at a record high. However, in Switzerland we can talk about a stagnation of deals,’ says Guy Vermeil, managing partner of Lenz & Staehelin. His downbeat assessment of the domestic M&A market is supported by last year’s numbers. As the broader Swiss economy stalled with GDP growth of only 0.8%, KPMG’s annual transactional review labelled 2015 as ‘troubled for the M&A market in Switzerland’. Transaction volume declined 17% compared to 2014, from 420 to 350 deals, while the aggregate value of completed M&A with a Swiss component fell 55% to $84.9bn.

Benedict Christ, co-head of M&A at Vischer, identifies removal of the currency peg as a particular problem: ‘There was certainly no growth in M&A, that’s probably mostly due to the appreciation of the Swiss franc in early January [2015], which made it considerably more expensive for foreign investors. The hit we took from the appreciation was probably not as bad as it could have been, but this will certainly continue to have an effect on the markets.’

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Standing tall – 2015 in review for the offshore elite

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The offshore transactional market continues to go from strength to strength. Our annual focus on the ten largest offshore firms again reveals impressive activity levels during the last year. According to Appleby’s recent private equity report, during the third quarter of 2015 deal activity was even more robust than usual: there were 660 offshore deals during the quarter, worth a total of $60.7bn. Of those, 26 involved private equity firms either acquiring or disposing of their investments. With a combined worth of $16.1bn, private equity deals therefore represented over a quarter of total offshore activity by value in Q3 2015.

Material growth in private equity-backed M&A is a trend that looks set to continue, according to Ogier global managing partner Nick Kershaw. ‘The asset classes are diverse, from real estate to trust companies, but there is consistent acquisitive appetite,’ he says. Ogier acted on several high-profile deals in 2015, such as providing Jersey law advice to Palamon Capital Partners on the £200m joint acquisition with Corsair Capital of Currencies Direct.

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A safe bet – charting the rise of private equity in Africa

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Africa’s economic transformation has made it a key target for globe-trotting private equity houses. Can the continent pay out for the lengthening queue of investors?

For the private equity (PE) community, where risk and return are uneasy bedfellows, Africa represents less of a gamble. Given the continent’s increasing political stability and steady economic growth, the stakes are becoming stacked progressively in the sponsors’ favour. Not so long ago, investors’ bets were as safe as buying a handful of lottery tickets.

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North Africa round table – Through the gate

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With North Africa becoming a regional hub for international clients doing business on the continent, we teamed up with Bennani & Associés to debate the practicalities of servicing clients in Algeria and Morocco.

For the avoidance of doubt, Africa is not a single market for international firms to crack. Not only is it a continent comprising 54 distinct legal jurisdictions, but there are also numerous entry points for global legal service providers to service their clients.

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Making gains – to be or not to be in the fiduciary business

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In July, global offshore firm Appleby announced the management buyout (MBO) of its fiduciary business for an undisclosed sum, backed by private equity house Bridgepoint. Completion is subject to regulatory and legal approvals, but is expected to wrap up by the end of 2015.

According to group chair Frances Woo, the sale had been considered for some time, so that the fiduciary arm could continue to develop new products while the legal side could invest in new technology and knowledge management going forward.

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Changing Tack – Bermuda triangulation

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Mythical triangles notwithstanding, the island state of Bermuda plays host to the prestigious America’s Cup in June 2017. But while it may be two years before the world’s sailing elite descends on the island state, competition for the local offshore firms has already arrived. In May, Cayman-based Walkers announced it would open in Bermuda later this year. This came just one month after Bennett Jones’ (Bermuda) law practice was launched through an association with Canada-based law firm, Bennett Jones.

These are significant changes for the islands, which have little experience of overseas firms on their territory, save for Sedgwick Chudleigh, which opened in Bermuda in 2006 in conjunction with international firm Sedgwick. Subject to regulatory approval, Walkers’ opening will be the first major offshore firm headquartered outside the islands to open in Bermuda. It wasn’t the only major player to show a keen interest this year either: British Virgin Islands (BVI)-based Harneys at press time announced a combination with Bermudian firm Hurrion & Associates to form a full-service practice, Harneys Bermuda. Continue reading “Changing Tack – Bermuda triangulation”

Aboard the propaganda train – sweat and spin amid a turbulent Russian market

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There’s an old Russian joke about a foreigner who visits the Soviet Union. Knowing his letters will be read by the state censor, he devises a system to communicate with friends back home. If his letter is written in black ink, the message is true. If it is written in red ink, the message is false. Eventually his friends receive a letter from Russia written in black ink: ‘Dear friends, I hope this letter reaches you. Contrary to the lies in our press, life in the Soviet Union is wonderful. Food is plentiful, apartments are spacious and well heated, and there are no shortages. In fact, the only thing I can’t find here is red ink.’

Asking international lawyers about the year they have just had in the Russian market is a similar exercise in reading between the lines. While many firms report that they are still making money, fuelled largely by a boom in restructuring work, this picture is undoubtedly airbrushed by lawyers’ unwillingness to discuss the negatives. No-one, however, is in any doubt that the precipitous decline of the Russian market is hitting revenues. Continue reading “Aboard the propaganda train – sweat and spin amid a turbulent Russian market”

Roaring back – Corporate activity has soared in Ireland

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Earlier this year, Ireland’s prime minister (An Taoiseach) Enda Kenny made an appeal to emigrants who had departed the country in the aftermath of the economic crash to return home. Speaking at the launch of an official government policy paper, ‘Global Irish: Ireland’s Diaspora Policy’, the appeal was aimed at encouraging educated Irish people to return, as the government ramps up efforts to entice international investment and capitalise on the fragile Irish economic recovery.

Identifying around 200,000 people, Kenny said: ‘Emigration has a devastating impact on our economy as we lose the input of people, of talent and energy. We need these people at home. And we will welcome them. I believe that, after seven years of emigration, 2016 will be the year when the number of our people coming home will be greater than the numbers who leave.’

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The Middle East: After the gold rush

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Latham & Watkins doesn’t make strategic missteps. Or at least that appeared to be the case until March, when the firm announced that it will close both its Abu Dhabi and Qatar offices later this year, relocating staff to its Dubai operation. Bill Voge, chair and managing partner of the firm that has been by most yardsticks the standout success story of the last 20 years, said the firm had been wrong in assuming there were four distinct hubs that the firm needed to service clients in the Middle East – Abu Dhabi, Dubai, Qatar and Saudi Arabia – and so after seven years in the region, the firm was consolidating its Middle East presence into Dubai and Riyadh.

For international firms, finding the appropriate business model and strategy for the Middle East has been a puzzle. The region was never more alluring than at the height of the pre-financial crisis period of 2007 and 2008. Intoxicated by crude oil prices at nearly $150 a barrel in the summer of 2008, the Middle East could hardly have felt more prosperous. As ostentation gripped the region, Dubai powered ahead with ambitious projects such as the man-made archipelago Palm Jumeirah and the Burj Khalifa, the world’s tallest building. Naturally, the legal profession sought to capitalise.

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