With no single UK law firm having made a significant impact on the US market, it was no surprise that the Magic Circle surrendered more ground to their US peers in the annual M&A league tables for 2014, given the deal splurge US corporates have been on.
Freshfields Bruckhaus Deringer, Linklaters, Allen & Overy (A&O) and Clifford Chance (CC) all slipped down Thomson Reuters’ global adviser rankings for value of deals completed during 2014. Ironically, Slaughter and May, which markets to clients and US law firms for UK advisory spots on US deals, was the only Magic Circle firm to rise up the law firm rankings for global M&A, jumping from 28th to 12th.
Even in European M&A, the bread and butter for the Magic Circle, it is not until sixth place that you’ll find a London-headquartered firm in Freshfields. Though secondary US securities work typically overstates the role of US advisers in European takeovers. The appetite for UK takeovers was strong last year, pushing total deal value for M&A involving UK companies up 31.2% to $372.7bn. Linklaters was the only Magic Circle firm to lose ground in this regard, falling from first to 14th as it executed 11 fewer deals (72), worth a combined $33.2bn. Freshfields overtook Linklaters by deal value, becoming the best-performing Magic Circle firm with an international expansion strategy, but Linklaters still outperformed rivals CC and A&O.
Although Europe saw a pronounced uptick in announced M&A activity, jumping from $561bn in 2013 to $870bn in 2014, there was a fall in completed deals from $629bn to $584bn as US political pressure led companies to pull out of tax inversion deals in Europe. Nonetheless, the bulk of M&A activity was fuelled by US takeovers and most predict that will continue into 2015. Jon Hayes, corporate partner at DLA Piper, said: ‘The US is going to remain a key driver of M&A activity next year, both from a cross-border and domestic perspective. Europe and Far East Asia will be key areas of focus for US corporates/investors.’
tom.moore@legalease.co.uk
For more on the 2015 deal market, see ‘The Last Word’.