Legal Business

Too big to fail

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Finance Cleary Gottlieb Steen & Hamilton

Experienced financial regulation partner Bob Penn, who moved to Cleary Gottlieb Steen & Hamilton last year and advised HSBC on the controversial bank ring-fencing reforms while at Allen & Overy (A&O), is clear on whether those reforms are fit for purpose. ‘This is a hugely unwelcome and disruptive process, and frankly yet another distraction from running a profitable bank at a time when they are already facing a cascade of regulatory reform and the prospect of Brexit.’

Legal Business

‘No justiciable defence’: Cleary, NRF and Quinn to go another round in $3bn Russian bond dispute

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Litigation Cleary Gottlieb Steen & HamiltonNorton Rose FulbrightQuinn Emanuel Urquhart & Sullivan

Partners from Cleary Gottlieb Steen & Hamilton, Norton Rose Fulbright and Quinn Emanuel Urquhart & Sullivan are set to go another round as Ukraine has vowed to appeal a pre-trial decision over a $3bn Russian bond repayment.

The High Court has ruled that Ukraine did not provide a ‘justiciable defence’ in the case, heard in London’s recently created financial court.

The case relates to a $3bn loan Russia made out to Ukraine in December 2013 in the form of a Eurobond. The Law Debenture Trust Corporation is the trustee of the bond, which was arranged by White & Case and Clifford Chance.

Ukraine argued the loan was made as part of wider Russian economic and military pressure to prevent Ukraine from signing an EU Association Agreement at the Vilnius Summit in November 2013. In March 2014, Russia annexed Crimea.

But following a pre-trial hearing, Justice Blair concluded: ‘The threats of the use of force by Russia which are relied upon by Ukraine as vitiating the Eurobond transaction fall within the foreign act of state doctrine as issues upon which the court should refrain from adjudicating.

‘This is a claim for repayment of debt instruments to which the court has held that there is no justiciable defence.’

Quinn partner Alex Gerbi lead for Ukraine and Norton Rose’s financial disputes partner Michael Godden acted for The Law Debenture Trust Corporation, the trustee directed by Russia’s Ministry of Finance to bring the case. Cleary acted for the Russian government, with a team including partners David Sabel and Jonathan Kelly.

Norton Rose instructed Brick Court’s Mark Howard QC and Oliver Jones. Fountain Court Chambers’ Bankim Thanki QC and Simon Atrill and Essex Court Chambers’ Malcolm Shaw QC were enlisted by Quinn.

In August 2015, Weil, Gotshal & Manges and White & Case acted as the lead advisers as Ukraine struck a debt-relief deal on its $18bn sovereign debt pile in a bid to rebuild its fragile economy.

tom.baker@legalease.co.uk

Legal Business

Revolving doors: Cleary loses partner to Simmons as Jenner & Block adds from White & Case

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Strategic recruitment Cleary Gottlieb Steen & HamiltonJenner & BlockSimmons & Simmons

In a busy week for London appointments, Haynes and Boone, Simmons & Simmons and Jenner & Block have all made hires.

Simmons has boosted its capital markets group with the arrival of Simon Ovenden, who will join the firm’s London office as a partner from Cleary Gottlieb Steen & Hamilton on 1 May 2017. The hire follows the similar appointment of Jonathan Mellor, who joined Simmons’ capital markets group from Allen & Overy in January 2017.

Ovenden has a background in representing financial institutions in jurisdictions ranging from the US to Nigeria and Pakistan.

Haynes and Boone has made a string of simultaneous hires, bringing in Emma Russell, Zoe Connor and Andreas Silcher.

Russell and Connor join Haynes and Boone’s London office as partners, where they will advise on a broad range of finance transactions. Russell joins from Carey Olsen while, Connor, joins from Ashurst where she was a senior associate.

Silcher rejoins the firm after a tenure as general counsel of the liquefied natural gas division of the Cardiff/Dryships group. An expert in oil and gas, Silcher said: ‘Haynes and Boone CDG is extremely well known and respected for its work in the shipbuilding and offshore energy sectors.

‘I’m excited to help build on that reputation and to also be part of a full-service firm that is quickly expanding its English law capability and global reach.’

Also adding to its London capacity is Jenner & Block, hiring Jason Yardley as a litigation partner.

Yardley, who has over two decades of international litigation and arbitration experience, has acted in cases concerning the TMT sector in addition to banking, finance and mining. Yardley joins from White & Case where he spent almost 17 years litigating disputes across Europe, North America, Africa and Asia and sat on the firm’s partnership committee. The move reunites Yardley with his former White & Case colleague Charlie Lightfoot, who is Jenner & Block’s London managing partner.

In South Africa, Bowmans has hired Nicolas Bonnefoy as a partner in its oil and gas sector. Bonnefoy, who will join the firm’s Johannesburg office, had previously been involved in acquisitions and disposals of oil and gas assets throughout Africa.

Previously of Ashurst, Bonnefoy said: ‘I am deeply impressed by the Oil and Gas team, which combines industry expertise, local teams in Africa, as well as African- and English-qualified solicitors. The oil & gas offering is therefore comprehensive and competitive.’

tom.baker@legalease.co.uk

Legal Business

Linklaters, Cleary and White & Case advise as Glencore and Qatar take stake in Rosneft

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Corporate Cleary Gottlieb Steen & HamiltonLinklatersWhite & Case
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Linklaters, Cleary Gottlieb Steen & Hamilton and White & Case are advising as Glencore and the Qatari Investment Authority (QIA) offer to take a €10.5bn stake in Russian oil giant Rosneft.

The privatisation deal for 19.5% of Rosneft is yet to be completed, with the Russian state-owned oil firm forced to negotiate the sale around international sanctions. Despite the volatility of the transaction, Russian President Vladimir Putin made a public statement confirming the deal.

Legal Business understands Linklaters is advising Glencore, a long term client of senior partner Charlie Jacobs. Corporate partner and mining sector head David Avery-Gee is also a key adviser to the mining giant. Others from Linklaters team on the deal include finance partner Toby Grimstone and corporate partner Hugo Stolkin.

Cleary Gottlieb is advising the QIA on its side of the deal, while White & Case has been employed by Rosneft on the deal, with Doha-based corporate partner Michiel Visser understood to be acting on the transaction.

The deal to acquire the stake in Rosneft has been highly contentious due to sanctions against Russia from the US and the European Union. Glencore said it would commit just €300m in equity for around 220,000 barrels of oil a day, with the funds for the acquisition of shares provided by QIA.

On Wednesday (7 December), the Kremlin issued a press release claiming the privatisation deal for 19.5% of Rosneft had been completed.

However, Glencore subsequently released a statement claiming the company was still in ‘final stage negotiations’ on the deal.

In another recent mandate for Glencore earlier this year, Linklaters’ Avery-Gee advised on a $2.5bn sale of a stake in its agricultural arm to a Canadian pension fund, which was advised by Freshfields Bruckhaus Deringer.

Linklaters, Cleary Gottlieb and White & Case all declined to comment.

matthew.field@legalease.co.uk

Read more in: ‘Rain men – goodbye Harvard Kool-Aid, hello plain speaking at Linklaters’ c-suite’

 

Legal Business

Repeat business: Slaughters and Spanish best friend act as Santander buys back its asset management arm

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Corporate Cleary Gottlieb Steen & HamiltonSlaughter and May
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Slaughter and May, its best friend Uria Menendez and Cleary Gottlieb Steen & Hamilton have won roles advising on Santander’s buy back of its asset management business from private equity groups Warburg Pincus and General Atlantic.

Madrid-based Banco Santander sold 50% of its asset management business to the private equity houses in 2013, which had hoped to merge the business with UniCredit’s own asset management operation Pioneer before talks fell through earlier this year.

Santander Asset Management has €170bn of assets under management and generates €1.1bn of annual fee income.

Cleary advised Warburg Pincus and General Atlantic with a team including London based partners Simon Jay on corporate matters, Richard Sultman on tax issues and London/Milan based partner Carlo de Vito Piscicelli on financial aspects of the deal.

Slaughters advised Banco Santander alongside Madrid-based Uria Menendez. Corporate partner Michael Corbett led the Magic Circle firm’s team with M&A partner Antonio Herrera and Stephen Hess advising for Uria Menendez. The duo had advised Santander back in 2015 on the UniCredit deal which ultimately failed. Linklaters had advised UniCredit Pioneer Investments while Davis, Polk & Wardwell also acted alongside Slaughters.

Cleary acted for the PE houses on the original acquisition from Santander and then on their merger talks with UniCredit.
Jay told Legal Business: ‘This is another very interesting transaction with Santander. We’ve got to know them and their lawyers very well over the past two or three years and they’ve been very constructive around the transaction.’

In November it was revealed Santander UK had taken on Bank of Ireland’s general counsel John Bennett as its chief operating officer and senior counsel for legal and regulatory, joining a 35-strong team led by seasoned legal counsel John Collins, the bank’s director of legal, compliance, regulatory affairs and anti-money laundering.

madeleine.farman@legalease.co.uk

Legal Business

Cleary ends City partner promotion drought by making up one in finance

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Partnership promotions Cleary Gottlieb Steen & Hamilton
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One London lawyer has finally been made up at global firm Cleary Gottlieb Steen & Hamilton, as the firm promotes eight this year. The firm’s US contingent has made up the rest of its global partnership round.

After two years without a promotion, this year Cleary has elected to promote one in the City. Its new London partner brings up the promotion round by one following last year’s boost of seven.

Finance lawyer Jim Ho will become a partner on January 1, 2017. Currently advising a large CIS metals and mining company on its $5.7bn debt financings, Ho has previously guided UC RUSAL in its $5.15bn restructuring and the Truvo Group in its completed global restructuring. Ho has also advised Hellenic Republic on a number of complex transactions, including its €7.16bn bridge loan from the EU under the European Financial Stabilisation Mechanism and its €206bn bond exchange that formed a key component of the country’s EU assistance package.

Across Cleary, four have been made up in the firm’s New York headquarters while three will join the Washington DC office. The promotions bring the firm’s total partner headcount to 195. According to the Global 100, Cleary’s headcount in the City fell by 3% in 2015 to 117 fee earners. However over a five year track the firm’s headcount in London has lifted by 26%.

Other US firms to release their partner promotions this year include White & Case which bolstered its partnership by 40 this year, an increase of 23% on last year’s numbers with eight made up in the City. Kirkland & Ellis also announced it had made six up to partner in London in an 81-strong global partner promotion round while Ropes & Gray promoted two in its partner round of 11 this year.

madeleine.farman@legalease.co.uk

The full list of promotions:

Nowell Bamberger, disputes, Washington

Daniel Culley, antitrust,  Washington

David Herrington, litigation,  New York

Jim Ho, finance,  London

Aaron Meyers, M&A,  New York

Kenneth Reinker, antitrust,  Washington

Daniel Reynolds, real estate, New York

Kimberly Spoerri, M&A, New York

Legal Business

South African sell-down: Slaughters leads as GSK exits Aspen Pharmacare

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Corporate Cleary Gottlieb Steen & HamiltonSlaughter and May
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Slaughter and May, Cleary Gottlieb Steen & Hamilton and Bowman Gilfillan advised GlaxoSmithKline (GSK) on the sale of its remaining 6.2% stake in Aspen Pharmacare, announced last week.

GSK confirmed its intention to sell the remaining stake in the South Africa’s biggest generic drugs producer Aspen Pharmacare last Wednesday, expected to comprise up to 28.2m Aspen shares. GSK’s internal team was led by vice president & associate GC Antony Braithwaite.

The completion of the accelerated bookbuild raised £477m. GSK held in a stake in the firm for seven years.

Slaughters was lead counsel with a firm-wide team including corporate and commercial partners David Johnson and Chris McGaffin.

Cleary acted on US aspects of the deal with a team led by Sebastian Sperber, while Bowman advised on South African law. Bowman’s team was led by partners Ezra Davids and Ryan Wessels.

Commenting on the deal, Slaughters’ Johnson said: ‘It was a sell-down of residual stake which GSK picked up years ago; it was a straightforward transaction.’

Slaughters is a longstanding adviser to GSK, having advised the pharma group in July on its agreement with Verily Life Sciences (formerly Google Life Sciences), an Alphabet company, to form Galvani Bioelectronics.

In March the firm, alongside fellow Magic Circle firms Linklaters and Freshfields Bruckhaus Deringer, advised GSK on a multi-billion-dollar three-part deal with Novartis. This saw GSK acquire Novartis’s global vaccines business for $5.25bn and an equity interest of 63.5% in a new consumer healthcare joint venture.

georgiana.tudor@legalease.co.uk

For more on Slaughter and May’s M&A team see the feature: ‘The new boy – can Ryde & co keep Slaughters’ deal team on top?’

Legal Business

A change at the top: Cleary elects Michael Gerstenzang managing partner

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Leadership Cleary Gottlieb Steen & Hamilton
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Elite New York firm Cleary Gottlieb Steen & Hamilton has elected Michael Gerstenzang as its next managing partner.

Gerstenzang (pictured), who has built up a strong fund formation practice in New York, will replace Mark Leddy as leader of the firm in the New Year. Leddy served just five years as managing partner of the traditional Wall Street firm, half that of his predecessor Mark Walker.

Having made partner in 1999, Gerstenzang carved out a hugely successful practice advising buyout, credit and hedge funds. He counts the likes of TPG, KKR, Blackstone and The Raine Group as clients. He will take the helm 24 years after joining Cleary.

Gerstenzang said: ‘Mark has set the standard for excellence during his tenure as managing partner. Under his guidance, the firm has grown thoughtfully, broadening our practice and expanding our global footprint while maintaining our culture, structure and values.’

Leddy added: ‘Michael is a truly accomplished lawyer who deeply values the firm’s founding principles of collegiality, legal excellence and democratic governance. In his 24 years at Cleary, he has consistently demonstrated exceptional character, leadership and intellect. He embodies the internationalism that is at the core of our firm, and he will provide strong leadership as Cleary continues its tradition of innovation in the service of our clients around the world.’

While its Wall Street rivals made rapid advances during the early 2010s, Cleary’s growth has been sluggish during Leddy’s time in charge. The firm, which has grown at less than half the rate of white shoe peer Simpson Thacher & Bartlett over the last five years, suffered a 3% fall in revenue in 2015 to $1.21bn as profit per equity partner slipped 5% to $3.08m.

tom.moore@legalease.co.uk

For more on Manhattan’s elite see: ‘The conservation game – up close with New York’s original inner circle’

Legal Business

Cleary taps A&O for Frankfurt M&A hire as US law firms sustain Euro push

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Strategic recruitment Allen & OveryCleary Gottlieb Steen & Hamilton
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Top 25 Global law firm Cleary Gottlieb Steen & Hamilton  has bolstered its ranks in Frankfurt with the hire of corporate partner Michael Ulmer from Allen & Overy (A&O), the second German partner to quit the City firm this week.

Ulmer had joined A&O as a partner in 2006 from elite German independent Hengeler Mueller. His client portfolio includes leading German corporates, Mittelstand companies, and domestic and international financial and strategic investors.

The appointment is a rare senior recruit for the Wall Street-bred Cleary, which has long been sparing in partner recruitment despite having built a well-regarded European network over decades.

Cleary’s German practice now has around 60 lawyers and a growing reputation for corporate mandates, having advised American Express in the restructuring of its credit card joint venture with Credit Suisse in Switzerland; Citi as financial adviser to ZF Friedrichshafen in its $13.5bn acquisition of TRW Automotive; and Gazprom in a $2bn European oil and gas asset swap transaction with Wintershall.

The 1,300-lawyer firm also recruited from A&O’s London arm in April with the appointment of financial services regulatory veteran Bob Penn, one of A&O’s most prominent names.

Commenting on Cleary’s rigorous approach to lateral hiring, London-based partner Sunil Gadhia told Legal Business earlier this year: ‘We grow cautiously. We are not a firm that shoots out press releases on hires… we don’t hire and fire. It’s pure lockstep. Every partner is a long-term business decision. You need to be certain.’

The move comes as Latham & Watkins this week announced its hire of A&O’s Frankfurt-based partner Oliver Seiler, the City firm’s German international capital markets leader and co-head of its EMEA equity capital markets practice.

Other high profile laterals across Germany in recent weeks include Clifford Chance, which tapped King & Wood Mallesons for its high-billing German head of funds Sonya Pauls.

sarah.downey@legalease.co.uk

Legal Business

Cleary Gottlieb lands A&O FinReg head Bob Penn in rare City hire

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Strategic recruitment Allen & OveryCleary Gottlieb Steen & Hamilton
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In a rare partner exit from Allen & Overy (A&O), the firm’s head of non-contentious financial services regulation Bob Penn has quit to join Cleary Gottlieb Steen & Hamilton in London.

The hire is a significant move for the Wall Street-bred law firm, reflecting the robust demand for senior regulatory counsel in Europe. Penn leaves his role heading A&O’s financial services London team to join Cleary as a partner.

A&O’s City-based banking regulatory team will be co-led by partners Damian Carolan and Etay Katz. The firm also promoted Kate Sumpter to partner in the team from 1 May.

Penn departs from A&O after 17 years having joined in 1999 and being made up to partner in 2007. His experience covers the full range of non-contentious financial services regulation, advising banks, asset managers, market infrastructure providers and financial institutions on national and international regulation.

He also led A&O’s UK and European financial services reform agenda, including advising on revisions to capital requirements, the introduction of recovery and resolution plans and crisis management and retail ring-fencing for banks. Penn notably represented HSBC on its structural reforms to ring-fencing reforms in the UK and EU.

London Cleary partner Simon Jay said: ‘He brings a fantastic wealth of knowledge in UK and EU financial services regulation. Bob’s appointment will enhance our ability to offer bank and other clients in the financial services industry a single source of the highest quality advice across the EU and the US.’

‘Following the financial crisis, regulatory developments in the US, UK and EU have had a profound impact on our clients,’ argued Cleary Gottlieb managing partner Mark Leddy. ‘Bob’s joining us in London will cement our position as the only leading firm with a truly transatlantic financial services regulatory practice.’

An A&O spokesperson commented: ‘We would like to thank [Penn] for the contribution he has made. We have a strong banking regulatory capability in London. Our banking regulatory practice includes over 30 partners and 80 associates globally, recently bolstered by Charlotte Robins, who will join our Asia-Pacific team this summer.’

The appointment is a rare City recruit for Cleary, despite the New York-based law firm having built a well-regarded European network, with a strong reputation for securities and antitrust work. The firm currently has 117 lawyers in its London arm.

jaishree.Kalia@legalease.co.uk

For more on US firms in London click here for our 2016 Global London report.