King & Wood Mallesons (KWM) is restructuring its London teams, which has delayed the election of a new European managing partner and comes amid cash flow problems in the legacy SJ Berwin practice.
The move comes as the firm rolls out its 2020 strategy, which KWM global managing partner Stuart Fuller described as setting ‘a vision to be in the global elite for the next century’.
Fuller added: ‘Part of our strategy is to improve our energy and infrastructure practice as we see the market turmoil as an opportunity for our clients. We have a strong private equity and funds practice in the UK and we will get that to lift the firm globally in those areas. We’re already starting to see it in Asia.’
Practice management at KWM’s City offering has been overhauled, with the London office the first in Europe to restructure its divisions to reduce management layers. It currently has 17 practices that will consolidate into three areas: corporate, funds and finance; dispute resolution and regulation; and real estate. The move follows a slimming down of KWM’s China practice into five divisions last year, and Europe is earmarked for a similar restructuring.
Corporate partner Tim Bednall will lead the corporate, funds and finance division in London, which will also include employment; commerce and technology; restructuring and insolvency; employment and incentives; and tax.
Competition specialist Tom Usher will lead the dispute resolution and regulation division, which will encompass litigation, arbitration, competition, financial regulation and intellectual property.
Real estate, one of the big winners from the restructuring, will be headed by William Naunton, who KWM hired from Eversheds at the end of 2014 after convincing him to ditch plans to launch his own boutique. Naunton recently led the opening of KWM’s Cambridge office to offer low-cost support to the real estate practice in the City. The real estate division will encompass construction; real estate; planning and environment; and property litigation.
The reconfiguration of practice management has delayed the process of finding a replacement for Europe and Middle East managing partner William Boss, who returned to full-time fee-earning after less than a year in the post in January. Europe and Middle East senior partner Stephen Kon told Legal Business he wants the new practice leadership trio ‘to bed down’ first.
The practice restructuring comes as the firm considers alterations to its capital contributions structure, a move that could mean partners will be asked to inject more cash into the business. KWM is reviewing options to increase capital in its European and Middle East business – essentially the legacy SJ Berwin practice – following persistent cash flow problems, causing delays in payments to partners.
Global revenue at the firm fell 1% to $1.02bn in 2015, which the firm said was due to volatile currency movements in its two major markets, Australia and China. KWM says that global turnover would have been up by 8% to $1.13bn on a constant currency basis, citing a 17% fall in the Australian dollar against the US dollar in 2015.
tom.moore@legalease.co.uk