Finance view – White & Case reinvents its London banking practice with some success

Madeleine Farman and Victoria Young assess the firm’s reboot after a tough post-2008 run

Traditionally a strong lender side practice in London built around relationships with clients like Deutsche Bank and Goldman Sachs, White & Case’s banking team has moved on since the loss of a four-partner team to Latham & Watkins back in 2010. The exit of then co-head of banking Chris Kandel and his team was a significant hit to a practice that had been established at the peak of the 2000s credit binge as one of the City’s top leveraged shops.

Those departures were followed by the 2008 exits of Maurice Allen and Mike Goetz, the high-profile pair who masterminded the firm’s UK growth (Goetz was instrumental in taking Deutsche Bank from a US client into an eight-figure generator for the City practice).

With questions over strategy, regional factions and tensions between the firm’s projects and leveraged finance teams, at the time of the 2010 departures White & Case was at risk of prolonged stagnation, not least in its core banking team.

Since then, it has gone through an unexpected reinvention in its banking practice and in its City arm, which in 2015 generated revenue of £185m ($266m), more than any US-based rival.

Banking sector head for EMEA Lee Cullinane says turnover in the London banking team was up 63% between 2013 and 2015. Cullinane was asked to join the firm by a major banking client alongside Jacqueline Evans back in December 2010, decamping from Mayer Brown.

He says: ‘One of the great strengths of this team is the youth, the dynamism, the enthusiasm, its commitment – it’s one of the reasons we’ve grown very quickly. But one of the things clients were saying was that with the departure of a couple of senior partners, the team might benefit from somebody with grey hair.’

When Cullinane arrived, the core banking practice was down to 11 partners (not counting capital markets and projects), a figure that will rise to 17 partners on 1 January 2017, when the newly-made-up Emma Foster and Ben Davies join the partnership. During that time the team saw four partner exits: two retirements in finance lawyers Barbara Choi and Magda Bayim-Adomako, while restructuring specialist Mark Glengarry joined client Morgan Stanley in 2012 and Stephen Phillips joined Orrick, Herrington & Sutcliffe in 2014. Associate headcount has likewise grown from 32 associates in 2013 to 57 this year, pushing up leverage to nearly 4:1.

How White & Case will evolve as a finance player will be interesting to watch. As a classic bank-facing team, there is no doubt that a practice exposed to departures and tougher pricing looks different today, partly in response to shifting markets but also a pivot that has occurred over the last three years. The firm has tilted towards mainstream deal work, private equity and key global hubs, and away from its heavy slant on emerging markets and infrastructure finance.

In line with many other banking practices in the City, the firm has shifted its traditional lender base to cover more sponsors and funds clients, such as GSO Capital Partners, which the highly-rated Gareth Eagles works with. The practice also works regularly with the firm’s four-partner City high-yield team, which sits in the capital markets practice. Happily, the firm has built a well-regarded high-yield team in London, thanks to seasoned hands like Rob Mathews positioning it in an increasingly key strategic product line, despite White & Case never coming close to challenging Latham and Cahill Gordon & Reindel in the New York junk bond arena. Likewise, a respectable Term Loan B and restructuring capability positions the practice well for current markets.

As Evans says: ‘We try and be super-nimble around seeing where the changes are in the market, but that’s not to say that we’ve taken our eye off our traditional client base.’

While the team sources 80% of its work through its own client base, rivals observe that junior partners, such as Martin Forbes hired from Clifford Chance and Colin Harley from Maclay Murray & Spens in 2014, were appointed to service the firm’s fast-expanding private equity team led by Ian Bagshaw and Richard Youle, and are poorly integrated with the rest of the firm. Cullinane argues HgCapital’s arrival as a client has benefited the finance practice, while CVC Capital Partners has increasingly looked to White & Case for advice following the arrival of the private equity duo.

‘Clients were saying the team might benefit from somebody with grey hair.’
Lee Cullinane, White & Case

In another move to broaden capability, in June the firm announced the hire of Freshfields Bruckhaus Deringer’s Jeffrey Rubinoff in a concerted push to grow in the increasingly lucrative real estate finance sector. Rubinoff says: ‘We are all part of a coherent group. I work with the real estate team, which sits beside me. I work with private equity because their clients are the investors in a lot of these things that we’re financing. I work with leveraged finance because in the non-performing loans space a lot of that is common to acquisition finance.’

For some, the range Rubinoff mentions could be a weakness, with White & Case maintaining respectable coverage across a wide span of product lines rather than following many US rivals like Latham in focusing on a couple of tightly-defined niches. But aided by a more confident mood at the firm, White & Case has played its hand well.

madeleine.farman@legalease.co.uk

victoria.young@legalease.co.uk