Legal Business

‘An anticipated dip’: Eversheds’ 2016/17 profit falls as revenue increases by 8%

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Financial results 2016/17 Eversheds Sutherland

Following the completion of its transatlantic merger with Sutherland Asbill & Brennan on 1 February, legacy Eversheds  today (19 May) reported revenue growth of 8% to £438.6m for 2016/2017.

However, the firm’s net profit and profit per equity partner (PEP) dipped by 4% and 2% respectively, with PEP at £726,000, down £16,000 from £742,000 in 2015/2016. This follows flat PEP against 7% revenue growth in the previous financial year.

The revenue increase means Eversheds’ top line has grown 20% in the last five years, from £366m.

Eversheds Sutherland chief executive Lee Ranson (pictured) said: ‘To have turned in this kind of result against the backdrop of Brexit and continued political and economic uncertainty in many of our key markets speaks to the strength and resilience of our business.’

However, just months after formalising its tie-up with Sutherland, Ranson attributed the union as one of the main causes for the fall in profitability: ‘Continued strategic investment in people, recruitment and, most notably, our US combination led to an anticipated slight dip in profitability’.

However, he told Legal Business: ‘We are making sure we are investing for the future. The acquisition in Germany [of Heisse Kursawe in 2015], investment in new recruits, systems, technology and the US combination, all of that comes into play.

‘The combination we achieved was not an investment we budgeted for. Combinations have front-loading, due diligence and time costs, but those investments eventually pay back. This is organic growth, I’m very pleased.’

Earlier this year, the firm’s LLP accounts for 2015/16 showed the UK accounted for £340.2m of its total turnover, up from £336.5m, while the rest of Europe made £37m in revenues, up from £17m the year before. This compares to Sutherland’s last reported top-line of $300m in 2015.

The firm’s accounts also revealed that the firm’s average remuneration per member has dropped 10% from £410,000 to £386,000 as the firm’s staff costs have increased 16% from £150.2m to £174m.

Last month, the firm also made 20 partner promotions, with 50% of these promotions outside the UK in countries such as Austria, France, Germany, Hong Kong, Ireland, Italy, Latvia and the United Arab Emirates. The round was a reduction on last year when the firm made up 26.

georgiana.tudor@legalease.co.uk

Legal Business

Deal watch: Corporate activity in May 2017

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Corporate Eversheds Sutherland

MAGIC CIRCLE ADVISE ON VODAFONE’S INDIA MERGER

Slaughter and May, Allen & Overy (A&O) and local advisers S&R Associates, Vaish Associates Advocates and Bharucha & Partners all gained mandates as Vodafone struck a deal to acquire Indian rival Idea Cellular. The merger will create India’s largest communications business by revenue, valued at more than $23bn. Slaughters and S&R represented Vodafone and Vodafone India, while A&O, Vaish and Bharucha advised Idea.

Legal Business

Partner promotions: Eversheds Sutherland promotes half outside the UK in reduced round of 20

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Partnership promotions Eversheds Sutherland

Eversheds Sutherland has made 20 partner promotions, with 50% of these promotions outside the UK in countries such as Austria, France, Germany, Hong Kong, Ireland, Italy, Latvia and the United Arab Emirates. The round is a reduction on last year when the firm made up 26 partners.

Within the UK there are ten partner promotions across Birmingham, Leeds, London, Manchester and Nottingham. Of these promotions, 30% or a total of six partners, are female.

The firm’s company commercial practice group, which is headed up by legacy Eversheds partner Keri Rees, has seen the largest amount of partner promotions, with 14 in total. Four partners have been made up in litigation and dispute management, while two were promoted in the firm’s real estate group. In addition, eight legal directors have been promoted in the UK.

Commenting on the promotions, Lee Ranson, Eversheds Sutherland managing partner and chief-executive-elect (pictured) said the broad geographic spread of the promotions spoke volumes about the strength in depth across the group.

‘We continue to increase our overall proportion of female partners and that remains an ongoing aspiration. In the past week, we were recognised by The Times as a Top 50 Employer for Women for the sixth consecutive year.’

Earlier this month, Addleshaw Goddard released a drastically reduced round of partner promotions, with only five lawyers promoted to partner.

kathryn.mccan@legalease.co.uk

Partner promotions in full:

Stephen Barry, litigation and dispute management, Dublin

Gregory Buckley, litigation and dispute management, Manchester

Sarah Naylor, litigation and dispute management, Manchester

Wesley Pydiamah, litigation and dispute management, Paris

Tom Birchall, real estate, Birmingham

Matthew Storer, real estate, Birmingham

Guilia Bramanti, company commercial, Milan

Paul Castle, company commercial, Leeds

Clint Dempsey, company commercial, Dubai

Catherine Detalle, company commercial, Paris

Louis-Narito Harada, company commercial, Paris

Lena-Sophie Kaltenegger, company commercial, Vienna

James Lindop, company commercial, London

Elizabeth Marshall, company commercial, Leeds

Paul Moloney, company commercial, Hong Kong

Edijs Poga, company commercial, Riga

Lutz Schreiber, company commercial, Hamburg

Theresa-Marie Stodell, company commercial, Birmingham

Mark Taylor, company commercial, Birmingham

Ash Woodcock, company commercial, Nottingham

Legal Business

Eversheds Sutherland lands key role on administration of British retailer Jaeger

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Commercial Eversheds Sutherland

Eversheds Sutherland has landed a key role on the administration of British retailer Jaeger, acting for the administrator AlixPartners.

Jaeger’s directors appointed administrators yesterday (10 April) after failing to find a suitable buyer for the business, which has 46 stores, 63 concessions, a head office in London and a logistics centre in King’s Lynn.

The administration puts 700 high street jobs at risk.

Last week private equity firm Better Capital sold Jaeger’s debts for £7m to a mystery buyer, in a deal that represents a loss of £62m for the private equity firm which acquired Jaeger in 2012 for £19.5m.

According to reports, Edinburgh Woollen Mill, owned by the billionaire Philip Day was understood to have taken control of the 133-year-old business.

Last month saw Eversheds advise, along with Linklaters as Sir Philip Green agreed a £363m pensions deal with BHS following the collapse of the retailer last year.

The payment came as part of a bid to satisfy the UK Pensions Regulator (TPR), which was planning legal proceedings to secure a payment from Green. TPR used its own team of in-house lawyers.

Eversheds pensions partner Emma King led a team acting on the payment for the BHS trustees, while pensions partner Mark Latimour also advised. The payment comes as part of an attempt to plug the £571m shortfall left in BHS’s pension fund and follows a major parliamentary investigation into the failure of the high street chain.

kathryn.mccann@legalease.co.uk

Legal Business

Revolving doors: National recruits for Eversheds and TLT, while Ashurst and DWF bulk up in Europe

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Strategic recruitment AshurstDWFEversheds Sutherland

In a busy week for both UK-based lateral hires and those further afield in Europe, Eversheds Sutherland has strengthened its education sector group in Leeds, while Ashurst has appointed a new banking partner in Italy.

Eversheds Sutherland has hired from Pinsent Masons with the appointment of employment partner Chris Mordue, who led the firm’s national university employment and industrial relations teams.

Mordue has spent over 19 years in the higher education sector and has comprehensive experience across the full range of employment work for universities. He has particular expertise in working on the reform of dismissal and grievance procedures of chartered universities as well as handling high-profile employment disputes, senior level exits, industrial relations issues and restructures, and the employment aspects of international ventures and mergers.

Meanwhile, national law firm TLT has bolstered its real estate group in Manchester with the appointment of John Hyde. Hyde, who joins in May 2017 from Weightmans has over 25 years’ experience in the commercial property sector acting for a wide range of clients including IKEA (pension fund), JJB, and Total Fitness. He has also acted on significant transactions including the refinancing of the MEN arena and is noted by the Legal 500 as ‘responsive and technically excellent.’

Further afield, Ashurst has appointed partner Mario Lisanti to lead the firm’s banking practice in Milan. He will be joined by two senior lawyers, Alberto Castelli and Domenico Petrone. Lisanti joins from Norton Rose Fulbright and has almost 20 years’ experience of acting for banks, asset managers and investors on a wide range of banking and finance transactions.

Stephen Edlmann, managing partner of Ashurst in Italy, said that the move complemented the firm’s strategy to grow its offering in globally strategic areas and enhances Ashurst’s breadth and depth of practice in Milan.

Finally, DWF has appointed litigation partner Romain Dupeyré to its Paris team following the firm’s recent merger with French firm Heenan Paris. Dupeyré joins from litigation boutique BOPS and specialises in international arbitration and insurance litigation.

Jean-François Mercadier, DWF France managing partner, said: ‘Romain’s appointment is the first step of DWF France’s development post-merger, consolidating the firm’s profile in the African market as one of the leading firms in Paris.’

kathryn.mccann@legalease.co.uk

Legal Business

Longstanding leader Hughes to exit Eversheds Sutherland in October after project management stint

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Eversheds Sutherland

Eversheds Sutherland‘s longstanding chief executive Bryan Hughes is to depart the firm in October following a six month stint in project management for the firm.

Hughes (pictured), who steps down from the chief executive role at the end of April, will hand over to the firm’s current managing partner Lee Ranson. It is understood that he will then undertake a research project which will look at the firm’s consulting offering and Eversheds Sutherland’s strategy. A large part of the role will involve client work. Following this, When Hughes leaves the firm at the end of October, he is likely to take up a role outside the law.

Eversheds Sutherland’s consulting offering currently includes in-house legal advisory as well as regulatory compliance, technology and HR consulting. The firm’s contract lawyer service Eversheds Sutherland Agile and its business as usual outsourcing arm Eversheds Sutherland Integrate also fall under the consulting arm.

Hughes joined Eversheds in 1984 as a trainee, and specialised in commercial litigation before establishing an insurance practice which predominantly handled defendant personal injury work, a range of insurance related disputes and professional negligence and fraud claims.

Appointed managing partner of the firm’s Cardiff office in 2000, became managing partner in 2006 and was first appointed chief executive in 2009 to serve two four-year terms.

From the beginning of May, Eversheds Sutherland will be led by Ranson, alongside Sutherland’s managing partner Mark Wasserman on a six-person global executive team which is overseen by a global board of ten people with equal representation from each firm.

Earlier this month, Legal Business revealed that the firm had appointed corporate partner Keri Rees to head up the firm’s global company commercial practice group following Keith Froud’s appointment as managing partner.

Meanwhile, the current head of Eversheds UK private equity team, Richard Moulton, will take over as head of the firm’s corporate and M&A team. This position was also previously held by Froud.

kathryn.mccann@legalease.co.uk

Legal Business

News in brief – March 2017

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Legal mergers Eversheds SutherlandFieldfisherFreshfields Bruckhaus DeringerHogan Lovells

FRESHFIELDS SIGNS 20-YEAR LEASE ON NEW HQ

Freshfields Bruckhaus Deringer has signed a pre-let agreement on a 20-year lease in February to move from existing premises in Fleet Street to 100 Bishopsgate in 2021. The Magic Circle firm will reduce its London real estate by roughly a third when it takes out 255,000 sq ft of office space.

 

Legal Business

Paying up: Linklaters and Eversheds advise as Sir Philip Green agrees £363m pensions deal

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Commercial Eversheds SutherlandLinklaters

Sir Philip Green has paid £363m into the BHS pension pot following the collapse of the retailer last year, with Eversheds Sutherland and Linklaters advising.

The payment comes as part of a bid to satisfy the UK Pensions Regulator (TPR), which was planning legal proceedings to secure a payment from Green (pictured). TPR used its own team of in-house lawyers.

Eversheds pensions partner Emma King led a team acting on the payment for the BHS trustees, while pensions partner Mark Latimour also advised. The payment comes as part of an attempt to plug the £571m shortfall left in BHS’s pension fund and follows a major parliamentary investigation into the failure of the high street chain.

Linklaters advised Green, having been the tycoon’s primary legal adviser in recent years. The Magic Circle firm acted on the disposal of BHS by Green’s Arcadia Group in 2015 for £1 to Retail Acquisitions and businessman Dominic Chappell, who were advised by Olswang.

Disputes partner Andrew Hughes has been advising on the settlement, while corporate partner Owen Clay has previously been one of main legal advisers to Arcadia Group, which is run owned by Green.

The Pension Protection Fund (PPF), the government pensions lifeboat, was advsied by Stephenson Harwood partners Libby Elliott and Mark Catchpole.

TPR chief executive Lesley Titcomb said: ‘The agreement we have reached with Sir Philip Green represents a strong outcome for the members of the BHS pension schemes. It takes account of the interests of both pensioners and the PPF, and brings a welcome level of certainty to present and future pensioners.’

The regulator called time on its enforcement action against Green, while actions continue against Chappell and Retail Acquisitions. Chappell was recently represented by Matthew Parfitt of Erskine Chambers during high court proceedings into the solvency of Retail Acquisitions.

Last summer, Green and many of the legal advisers on the deal appeared before a joint parliamentary committee after BHS entered administration. MPs led by Labour MP Frank Field called on firms to disclose their legal fees, revealing Linklaters had billed Arcadia £1.2m as of February 2016.

Eversheds declined to comment. Linklaters had not replied for comment at press time.

matthew.field@legalease.co.uk

Legal Business

Adding in Asia: Eversheds Sutherland gets Ministry of Law approval for Singapore merger

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Asia Eversheds Sutherland

Eversheds Sutherland, fresh from completing a transatlantic tie-up, has finally gained Singapore Ministry of Law approval for its merger with Harry Elias Partnership.

The tie-up was previously delayed as a result of the name change resulting from the combination between Eversheds and Sutherland Asbill & Brennan.

The merger is unique in that it will allow Eversheds to gain access to Singapore’s legal market, without being subject to local licensing requirements that only allow firms to practice Singapore law in ‘permitted areas’ and are subject to renewals.

The only fully integrated firm at present is Morgan Lewis & Bockius, which combined with Stamford Law in March 2015 to enable it to practise across all legal service areas.

Legal Business revealed last March that Eversheds was in talks with Harry Elias for a Singapore tie-up. The firm has had an office in the city since 2009, which is led by managing director Oommen Mathew. The outpost covers corporate commercial, dispute management, banking and finance and human resources and employment.

Last September Eversheds moved into the same building as Harry Elias as talks continued between the two firms.

Harry Elias, which has about 60 lawyers, is led by managing partner Philip Fong. The full service law firm is well-regarded for its strong dispute resolution practice which includes expertise in international arbitration, and its formidable matrimonial and family law practice.

Singapore is still a lucrative market for many law firms, with Osborne Clarke recently expanding its south-east Asia presence through an association with a new Singaporean firm, OC Queen Street. In July, Reed Smith entered into a formal alliance with Singaporean firm Resource Law giving the firm the ability to practise Singapore law for the first time.

kathryn.mccann@legalease.co.uk

Read more: ‘Eversheds realises long-held US ambitions by combining with Sutherland’

Legal Business

Eversheds average member remuneration drops 10% to £386,000, as staff costs increase 16% to £174m

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Salaries Eversheds Sutherland

Eversheds LLP’s have revealed that the firm’s average remuneration per member has dropped 10% from £410,000 to £386,000 as the firm’s staff costs have increased 16% from £150.2m to £174m.

Turnover at the firm for the financial year 2015/16 was £405.3m, up 7% from £379.4m while profit only increased by 2% from £121.9m to £124.4m.

A revenue breakdown showed the UK accounted for £340.2m of total turnover, up from £336.5m, while the rest of Europe made £37m in revenues, up from £17m the year before. Revenues from the rest of the world totalled £27.8m from £25.4m the year before.

Eversheds operating loss in the firm’s joint ventures also increased, from £455,000 to £720,000. Group operating profit before joint ventures increased by 2% from £123.7m to £126.4m.

Despite only a slight increase in profitability, the firm’s key management compensation which includes the chief executive, managing partner and members of the executive committee saw their share of the profits and salaries increase by 10% from £7m to £7.7m.

The firm’s highest paid member took home £1.4m, down 2% on last year’s figure of £1.5m.

Additionally, the number of members increased from 296 to 323, and the total number of staff increased from 2,647 to 2,963.

Last week saw Eversheds’ combination with US firm Sutherland Asbill & Brennan go live, following a partner vote in December.

Eversheds Sutherland will be led by chief executive Lee Ranson who takes over as Eversheds chief executive in May, alongside Sutherland’s managing partner Mark Wasserman on a six-person global executive team which will be overseen by a global board of ten people with equal representation from each firm.

Keith Froud, who will take over as managing partner of the UK firm in May, as well as executive partner Ian Gray, will also sit on the global executive team, along with Sutherland partners Victor Haley and Thomas Gick; however Gick will be replaced in April by Cynthia Krus.

Pursuing a US tie-up has been a high priority for Eversheds since 2014 when the partnership heavily backed the strategy through a vote. The firm held discussions with Milwaukee-based Foley & Lardner, which emerged as the preferred firm. However, these talks quickly fell through after a memo from Foley’s chair and chief executive Jay Rothman said no decision was made to pursue such an affiliation.

kathryn.mcann@legalease.co.uk