Legal Business

Momentum at last for Hogan Lovells as global turnover passes $2bn mark

Posted on |
Financial results 2017 Hogan Lovells

Eight years into its transatlantic union Hogan Lovells is finally gaining some momentum, posting another solid financial performance and passing the $2bn revenue mark in 2017.

Global turnover rose 6% to $2.036bn while profit per equity partner (PEP) returned to growth, rising 2% to $1.28m. The weak pound meant the firm experienced an 11% top line uptick to £1.58bn in sterling terms.

Revenue per lawyer grew 3% to $758,500 and headcount rose 3% to 2,685 in a year marked by a merger in Boston and 37 lateral hires.

This follows a mixed 2016, where the firm boosted turnover by 6% after years of lacklustre performance but PEP remained flat.

Chief executive Steve Immelt (pictured) said he was ‘very pleased’ with the firm’s latest results but told Legal Business of a challenging year as the uncertainty surrounding the start of Donald Trump’s administration in the US, Brexit and the UK general election had a ‘restraining effect on what people do and are planning to do’.

‘We had a lot of up and downs in work over the course of the year but the last few months were very strong,’ added Immelt, whose term was recently extended by a further two years until June 2020. ‘We go into 2018 with momentum and the macroeconomic outlook is more positive.’

Corporate and regulatory, which accounted for 32% and 16% of revenues respectively, had a ‘very strong year’ according to Immelt. The litigation, arbitration and employment group was the second largest contributor at 28%, while the finance team and intellectual property, media and technology group contributed 14% and 10% each.

Growth was slightly more subdued in London, where turnover rose 4% to £292.6m, although the London team led on one of the leading corporate mandates for the firm worldwide, the £3bn takeover of Paysafe by Blackstone and CVC, and saw the arrival of Freshfields investment funds veteran Jonathan Baird.

Most of the revenue came from the Americas, which brought in 52% of fee income followed by Europe at 41%. The firm was in expansion mode throughout the year in the US. In September it merged with Boston-based litigation and investigation firm Collora, taking on all of its 15 partners, while last spring it made a major Silicon Valley play with four corporate partners from Weil, Gotshal & Manges.

‘We do a tremendous amount of work in life sciences, so not having an office in Boston seemed like a gap,’ said Immelt. ‘So far it’s been terrific. We are working together on matters they brought with them.’

The firm also ventured into non-legal advice in London, launching a financial services regulatory consulting practice led by former PwC director Steve Murphy. Immelt said the practice was still ‘at an early stage but we continue to see opportunities to offer clients non-legal advice’.

Marco.cillario@legalbusiness.co.uk

Legal Business

Let’s be friends – Hogan Lovells hooks up with NewLaw darling Elevate for flexi-lawyer service

Posted on |
Innovation Hogan Lovells

Hogan Lovells is the latest firm to venture into flexible lawyering after agreeing a partnership with New Law pioneer Elevate.

The deal announced today (15 February) will give the transatlantic giant access to a pool of 1,500 self-employed professionals worldwide to support its UK business. Elevate will provide a group of pre-vetted lawyers to choose from for specific projects, with Hogan Lovells’ paying Elevate for the cover. Hogan Lovells expects to use between 30 and 50 lawyers from the pool every year and will be looking at four to ten-year qualified lawyers across all practice areas.

The deal also gives Elevate access to the Anglo-American law firm’s alumni network and the arrangement will be used to offer a different working model to those who decide to leave the 2,600-lawyer practice.

Hogan Lovells’ head of legal service delivery Stephen Allen told Legal Business: ‘The size of the transactions and matters any law firm is working on are getting bigger. It’s important that we have sufficient skills to meet the clients’ demands, so we feel we needed to expand our capability in particularly busy periods.’ He added that although the deal will initially only involve the firm’s UK operations, the collaborations could be extended globally in future.

Founded in 2011, Elevate provides legal technology, consulting and flexible lawyering to legal departments and law firms. Hogan Lovells is the first major firm to go public with a collaboration with the Los Angeles-based company, which last year generated $40m in revenues.

Elevate, which entered the UK market five years ago, also collaborates with regional law firm asb law and with the in-house departments of BT and HSBC. The much-touted business is unusual among NewLaw competitors in offering a broad range of services, spanning consulting and legal service provision.

Elevate president John Croft told Legal Business: ‘Hogan Lovells realised they needed to offer their clients a flexible service, they realised we already had that, we know how to do it and we do it at scale.’

The move will be seen as further evidence of law firms’ drive to bolster low cost operations coming in the same week that Clifford Chance acquired Carillion’s volume law arm. Changes in the industry have also seen law firms collaborate with other providers with DLA Piper in 2016 signing a deal with Lawyers On Demand to provide flexible cover while Allen & Overy the same year launched the MarginMatrix derivatives business with Deloitte.

marco.cillario@legalease.co.uk

Legal Business

More reshuffling as Hogan Lovells appoints new chair while Travers Smith confirms Patient managing partner

Posted on |
Leadership Hogan LovellsTravers Smith

As the January senior appointments merry-go-round at City and global law firms continues, Hogan Lovells has announced a new chair while Travers Smith has re-elected David Patient as managing partner.

In a move that brings its German practice in the spotlight, Hogan Lovells has announced that Hamburg-based Leopold von Gerlach will replace Nicholas Cheffings as chair of the board on 1 May for a three-year term.

A member of the board representing continental Europe since 2014, IP, media and technology partner von Gerlach was voted into the new role by the partnership after the board put forward his name following a firm-wide consultation process. He joined the firm in 1995.

Members of Hogan Lovells’s board make up the compensation committee, which looks after the firm’s annual bonus scheme and reviews equity partners’ remuneration every second year. They are also part of the equity elevation and partner advancement committees, working with the firm’s management on the promotion of associates and counsel to the partnership.

The board provides input to the international management committee and oversees the affairs of the firm, but has no executive responsibility for strategy.

Speaking to Legal Business, Cheffings said von Gerlach had a ‘broad combination of attributes’ that made him the right choice for the role: ‘He has been with the firm for a long time, he understands the culture, he is very focused upon collaboration and people being at the heart of our business – very good with clients.’

Real estate disputes co-head Cheffings was Hogan Lovells’ first post-merger sole global chair, taking over from co-chairs Claudette Christian and John Young in 2012, two years after the merger between Lovells and Hogan & Hartson. He was re-appointed in the role in 2015  and is now stepping down after reaching the maximum two terms set by the firm.

He said his main achievement in his six years as chair was ‘overseeing the transition from a firm which was seen as a new kid on the global block – with a lot of energy and excitement but clearly challenges in terms of delivering on its plans – to what’s now a very mature player and one of the most highly respected global law firms with a very distinct place in the legal market.’

Cheffings will continue to lead Hogan Lovells’ real estate disputes group along with Mathew Ditchburn.

Meanwhile, Travers Smith re-elected David Patient as managing partner after he stood unopposed.

Patient, who will manage the firm for a second three-year term starting on 1 July, told Legal Business: ‘Last year went by in a flash, and politically we seemed to be lurching from one crisis to another but we sailed through it all. Clients were very busy in lots of areas, regulatory has been very busy and disputes has been firing on all cylinders. Private equity and M&A have also been strong.’

He added he was ‘pretty positive’ for the year ahead. ‘There will be some bumps in the road ahead but I’m confident that this year is going to be good in lots of areas.’

Travers-bred corporate lawyer Patient became a partner in 1999, when he established its Paris office, and replaced Andrew Lilley at the helm of the firm in January 2015 . He had previously run for the managing partner role in 2009 losing out to Lilley, who went on to serve a second term in 2012.

The firm’s most recent financial performance showed a 4% rise in revenue to £125m in 2016/17, marking eight consecutive years of growth. But profit per equity partner dropped 4% to £970,000, with Patient saying at the time the firm was ‘right in the middle’ of a period of significant investment .

marco.cillario@legalbusiness.co.uk

Legal Business

Partner promotions: Hogan Lovells makes up five in London amid 31-strong drive

Posted on |
Partnership promotions Hogan Lovells

Hogan Lovells has made up five partners in London as part of a New Year promotions round that ushered in 31 new partners globally.

The London promotions include Alex Harrison, finance partner in Infrastructure, energy, resources and projects and corporate partner Jeremy Pickles in the firm’s investment funds team.

The round saw two new partners made up in Hogan Lovells’ litigation practice – Valerie Kenyon and Matthew Felwick, while restructuring and insolvency lawyer Alex Kay was promoted in the firm’s finance practice.

The total of 31 partner promotions was up on last New Year’s round, which saw 29 made up internationally, including three in the City.

Globally, the move sees seven new partners in corporate, ten in litigation and arbitration, five in government regulatory, five in finance and four in intellectual property. Eleven of the 31 lawyers made up to partner– or 35% – were women.

Europe saw the lion’s share of the promotions, with 15 new partners in London, Munich, Amsterdam, Madrid, Dusseldorf, Frankfurt, and Hamburg. In the US and Latin America, 13 were promoted across Mexico City, Denver, Miami, New York, Northern Virginia, Philadelphia, and Washington DC. Three were promoted in Asia across the Shanghai, Beijing, and Tokyo offices.

Steve Immelt, Hogan Lovells’ CEO, said: ‘We are seeing real momentum with these promotions – in terms of diversity of our practices, our offices, by gender, and by ethnicity.

‘They represent the globally diverse nature of our business. With that in mind, I am particularly pleased that more than a third of our new partners and new counsel are women’.

nathalie.tidman@legalease.co.uk

The new partners are:

  • Michael Bell – government regulatory, Washington DC
  • Meryl Rosen Bernstein –intellectual property, Northern Virginia
  • Jaime Bofill – litigation, Madrid
  • Sean Conaty – finance (infrastructure, energy, resources and projects), Tokyo
  • Matthew Eisler – corporate, Denver
  • Elizabeth Fawell – government regulatory, Washington DC
  • Matthew Felwick – litigation, London
  • Gaston Fernandez – finance (infrastructure, energy, resources and projects), Miami
  • Alex Harrison – finance (infrastructure, energy, resources and projects), London
  • Jörg Herwig – corporate, Frankfurt
  • Alex Kay – finance (restructuring and insolvency), London
  • Valerie Kenyon – litigation, London
  • Jorge Valdés – international arbitration, Mexico City
  • Inken Knief – international arbitration, Munich
  • A Elizabeth Korchin – litigation, New York
  • Henrik Lehment – intellectual property, Düsseldorf
  • Stephen Loney Jr. – litigation, Philadelphia
  • Carla Luh – finance (infrastructure, energy, resources and projects), Hamburg
  • Désirée Maier – investigations, white collar and fraud, Munich
  • David Massey – litigation, Miami
  • Daniel Metroka – investigations, white collar and fraud, Philadelphia
  • Jeremy Pickles – corporate (funds), London
  • Allison Pugsley – government regulatory, Washington DC
  • Bryan Ricapito – corporate (funds), Washington DC
  • Joanne Rotondi – government regulatory, Washington DC
  • Benjamin Schröer – intellectual property, Munich
  • Arne Thiermann – corporate (commercial), Hamburg
  • Florian Unseld – corporate (commercial), Munich
  • Hein van den Bos – government regulatory, Amsterdam
  • Helen Xia – intellectual property, Beijing
  • Lu Zhou – corporate (transactions), Beijing
Legal Business

Ashurst and Hogan Lovells win roles on Palmer & Harvey administration as takeover plan goes up in smoke

Posted on |
Dealwatch AshurstHogan Lovells

City firms have landed lead mandates on the administration of beleaguered British tobacco wholesaler Palmer & Harvey (P&H) following the collapse of a rescue takeover by The Carlyle Group.

Ashurst and Hogan Lovells are advising administrator PwC, which was brought in when a sale process that would see US buyout giant Carlyle acquire the ailing business fell over.

Carlyle had signed a heads of terms and memorandum of understanding to acquire P&H – which counts UK supermarket chain Tesco as one of its biggest clients – following a competitive sale process in the summer. The deal was not done by the time the private equity firm’s exclusivity ran out at the end of November, with the company’s liquidity crisis giving it no other option than to call in the administrator.

The Ashurst team is led by Giles Boothman, global head of restructuring and special situations, and also includes banking partner Jane Fissenden. Restructuring partner Deborah Gregor is leading the Hogan Lovells team, which is acting for both PwC and P&H’s lending banks.

Allen & Overy is advising Imperial Tobacco as one of the largest trade creditors to P&H. Slaughter and May is acting for the other major trade creditor, Japan Tobacco International (JTI). P&H had tried to address its liquidity issues in April when trade debt owed to Imperial and JTI was converted into senior secured long-tenor debt.

The company was also hit by Tesco’s proposed £3.7bn takeover of rival tobacco supplier Booker, which shrouded the future of P&H’s relationship with its biggest customer in doubt. That deal was given the provisional go-ahead in mid-November by the Competition and Markets Authority (CMA).

‘P&H had been facing a number of systematic issues in which the company was caught between powerful tobacco manufacturers and retail giants, a position which was not sustainable in the face of severely squeezed margins’, one industry source said.

PwC’s Matthew Callaghan, Ian Green and Zelf Hussein are the joint administrators. Callaghan, joint administrator and partner at PwC, said: ‘The P&H Group has faced a challenging trading environment, and the need for significant restructuring has been recognised for some while. The company has insufficient cash resources to continue to trade beyond the short term and the directors have concluded that there is no longer any reasonable prospect of a sale. Therefore, the directors have had no choice but to appoint administrators’.

The P&H Group employed around 3,400 employees, of which roughly 2,500 have immediately been made redundant.

nathalie.tidman@legalease.co.uk

Legal Business

Quest to guard privilege begins as ENRC wins right to appeal SFO order

Posted on |
Litigation Hogan Lovells

Throwing a lifeline to the increasingly eroded principle of legal professional privilege (LPP), Eurasian Natural Resources Corporation (ENRC) has this week been granted the right to appeal against a controversial order to disclose documents in a Serious Fraud Office (SFO) investigation. Hogan Lovells is the latest in a series of firms to be instructed by ENRC over the SFO investigation.

In May, the High Court had ruled that documents prepared by the mining giant ENRC relating to an SFO probe into alleged fraud, bribery and corruption were not covered by LPP and therefore had to be disclosed.

Justice Andrews held that there was ‘a recognised public interest in the SFO being able to go about its business of investigating and prosecuting crime; and the sort of evidence which one would expect to be found in the disputed documents is likely to be of considerable value to its current investigation.’

On a wider point, she noted ‘legal privilege attaches only to communications between the lawyer and those individuals who are authorised to obtain legal advice on that entity’s behalf. Communications between the solicitors and employees or officers of the client, however senior in the corporate hierarchy, who do not fall within that description will not be subject to legal advice privilege.’

At the time, ENRC confirmed it would appeal the decision, because ‘the effect of this judgment is that a party who wishes to consult a lawyer in relation to an SFO dawn raid or criminal investigation is not entitled to the protections afforded by litigation privilege.’

Herbert Smith Freehills disputes partner James Norris-Jones told Legal Business that it is a difficult situation for clients at the moment due to the SFO and Financial Conduct Authority (FCA) taking ‘increasingly aggressive approaches in an incredibly regulated world’.

He added: ‘It’s becoming increasingly difficult to preserve LPP. I don’t think it’s good for this country to be out of step on an issue like privilege’.

Simmons & Simmons senior partner Colin Passmore described the appeal being granted as ‘good news’, but also called for the matter to be concluded quickly.

‘If you talk to lawyers who advise corporates, they find the whole issue very difficult. How can you gather information when employees of a company are not regarded as part of the client?’

Signature Litigation had been representing ENRC throughout the investigation, led by founder Graham Huntley, who had instructed Fountain Court Chambers’ Richard Lissack QC and Tamara Oppenheimer, in addition to Outer Temple Chambers’ Saaman Pourghadiri.

However, Hogan Lovells has today  (12 October) taken over the mandate, with commercial litigation partners Chris Hardman and Michael Roberts advising ENRC on its appeal.

ENRC had initially hired Dechert to represent it and undertake a self-reporting process in 2011, but dropped the firm in 2014 after the company claimed it had been overcharged by over £11m.

tom.baker@legalease.co.uk

Legal Business

Looking east: Linklaters cements Saudi partnership as Hogan Lovells shuts Mongolia base

Posted on |
Middle East and Africa Hogan LovellsLinklaters

Two Global 100 firms have made opposing international moves this week, with Linklaters signing a partnership with a local firm in Saudi Arabia while Hogan Lovells announced the closure of its Mongolia base.

Linklaters announced today (11 October) it has entered a formal agreement with 20-lawyer Zamakhchary & Co (Z & Co), meaning two lawyers from the Magic Circle firm will be based in the kingdom.

The announcement comes five years after the two firms started exchanging referrals and working together on cross-border transactions, capital markets, finance and project finance. Four-partner Z & Co has offices in Riyadh and Jeddah.

Linklaters senior associate Omar El Sayed, described by Middle East managing partner Scott Campbell as ‘one of our young superstars’, will relocate from Dubai to work from Z & Co’s offices and lead Linklater’s Saudi operation. A lateral hire, still to be announced, will join El Sayed later this year.

Linklaters currently has 40 lawyers in Dubai and Abu Dhabi, managing the firm’s operations in the Middle East and North Africa region.

Campbell told Legal Business today’s agreement means the Magic Circle firm is ‘formally committing to having people on the ground in the Kingdom in the long term’ with the aim to ‘build a bigger business’.

He connected the expansion of the firm’s operation in the region to the Vision 2030 programme, through which the Kingdom is looking to diversify Saudi economy away from oil through economic and social initiatives and reforms, in the hope of generating $100bn in non-oil revenue by 2020 and develop six million jobs in non-oil sectors by 2030.

‘The modernisation and transformation of an economy brings a lot of advice opportunities in the transactional and corporate finance space,’ added Campbell.

A number of global firms have expanded their presence in the Kingdom since the programme was launched last year.

Last month CMS established a partnership with Riyadh practice Feras Al Shawaf . Clifford Chance announced in August last year that it was entering an association with Abuhimed Alsheikh Alhagbani Law Firm (AS&H), reworking its operation in the region after contention with local authorities over the legality of its Saudi office.

Herbert Smith Freehills  and DLA Piper also have a presence in the Kingdom.

Meanwhile, Hogan Lovells announced it will close its Mongolia office at the end of November after seven years, with local managing partner Chris Melville set to establish a new independent firm in Ulaanbaatar that will co-operate with Hogan Lovells.

Global chief executive Steve Immelt said the decision followed ‘a review of the market and our investment priorities’, adding that Melville had been ‘closely involved in the decision’. The firm has not said how many of the other 14 people employed in Ulaanbaatar will move to the new office.

The announcement means DLA Piper and Dentons are among the very few international firms with a presence in Mongolia.

marco.cillario@legalbusiness.co.uk

Legal Business

Revolving Doors: Hogan Lovells and OC bolster City ranks while Kennedys ramps up US practice with three-partner hire

Posted on |
Strategic recruitment Hogan LovellsKennedys

It has been another busy seven days for senior recruitment, with a host of top 50 UK law firms making senior appointments in the Square Mile and beyond.

In London, Hogan Lovells has bolstered its finance practice with the recruitment of Norton Rose Fulbright (NRF) partner Arun Velusami, who leaves the City firm after 11 years, seven of them as a partner. Velusami joins Hogan Lovells’ Africa practice in London and will also be a member of the Anglo-American firm’s energy, infrastructure and projects team. Adrian Walker, global co-head of Hogan Lovells’ energy and projects team, described Velusami as a ‘class act’.

Still in the City, Osborne Clarke (OC) has added to its buyout team, recruiting Squire Patton Boggs’ UK private equity head Tim Hewens. The appointment brings to 11 the number of partners covering private equity at OC.

Eversheds Sutherland, meanwhile, has recruited Jake McQuitty from TLT to strengthen its financial services disputes and investigations team. Before joining TLT in 2015, he was head of EMEA investigations and enforcement at Barclays.

On the international stage, Kennedys, Herbert Smith Freehills (HSF) and Dentons have all announced significant hires.

Kennedys returned to the US to bolster its expanding practice, recruiting from Sedgwick for the second time in a month, taking on the American firm’s Chicago managing partner and two other partners.

The UK-based insurance specialist has recruited Sedgwick partners Eric Scheiner, Dick Geddes and Jennifer Quinn Broda. The team has worked on matters including the Three Mile Island accident, the Exxon Valdez oil spill and explosions at the Piper Alpha oil rig and Buncefield in the UK.

The moves comes after Kennedys in June secured a merger with US practice Carroll McNulty & Kull. Kennedys senior partner Nick Thomas told Legal Business: ‘Since we announced the merger, we have had a lot of calls from a lot of people that say: “The idea of a law firm in the insurance sector with a big US presence and a global footprint looks very interesting, can we join?” It is an attractive platform for many.’

In continental Europe, HSF has hired arbitration partner Thierry Tomasi in Paris from disputes boutique Betto Seraglini. Tomasi specialises in aviation, energy, defence and construction and said he would look to develop his practice into Latin America.

In the Netherlands, Dentons Boekel has recruited a finance team from global rival Baker McKenzie. Former head of Bakers’ Dutch lending team Marcel Janssen will become Dentons’ head of banking and finance in Amsterdam, joining with three associates. The hires comes after Dentons’ merger in April with national practice Boekel.

marco.cillario@legalbusiness.co.uk

Legal Business

‘Unprecedented in scale’: City bluebloods advise as Tata separates UK pension scheme

Posted on |
Corporate Hogan LovellsSlaughter and MayTravers Smith

Travers Smith, Slaughter and May and Hogan Lovells all advised as Tata Steel last month signed a long-awaited agreement to separate its business from the £15bn British Steel Pension Scheme (BSPS), in what is the largest pensions scheme restructuring ever in the UK.

As a result of the separation, achieved through a regulated apportionment arrangement, Tata will pay £550m to BSPS, which will also be given a 33% equity stake in the steel company. With the support of The Pensions Regulator and the Pension Protection Fund (PPF), a new BSPS will be created after an assessment period.

Legal Business

Hogan Lovells to handle appeal as TfL refuses Uber new licence

Posted on |
Litigation Hogan Lovells

Hogan Lovells has been drafted in to advise Uber as the US-based ridesharing company launches a legal challenge to Transport for London’s (TfL) decision to not renew its private hire licence.

TfL today (22 September) issued a statement confirming that Uber will not be given another private hire operator licence after the current one expires on 30 September.

TfL stated that Uber’s approach to reporting serious criminal offences and how medical certificates are obtained were among the reasons it came to the decision.

‘Uber’s approach and conduct demonstrate a lack of corporate responsibility in relation to a number of issues which have potential public safety and security implications’, the statement read.

Uber has 21 days to appeal the decision but can continue to operate until that timeframe expires.

Hogan Lovells regulatory partner Charles Brasted is advising Uber, and has instructed Tom de la Mare QC of Blackstone Chambers.

The firm has previous history advising the company, as it acted for Uber last August on its legal challenge against new guidelines proposed by TfL. The regulations included written English tests for drivers and insurance for drivers for the entire time that their vehicle is licensed. In that matter, TfL was represented by its in-house team and instructed Martin Chamberlain QC of Brick Court Chambers.

Paul Dacam, who has since retired from the firm, led for Hogan Lovells and instructed de la Mare QC alongside Hanif Mussa of Blackstone Chambers.

Uber’s European arm has faced an eventful year so far, as the company’s European, Middle East and Africa (EMEA) general counsel (GC) stepped down in June. An Uber spokesperson confirmed that Amsterdam-based Jim Callaghan had resigned as a result of ‘family reasons’.

tom.baker@legalease.co.uk