Allen & Overy (A&O)’s management is bullish about the Magic Circle firm’s US expansion plans, having broken lockstep twice in 12 months to bring in two finance teams from major US firms.
In February it emerged A&O used its bonus pool to hire a three-partner Paul Hastings team. The US firm’s leveraged finance head Bill Schwitter joined A&O’s New York office as the firm’s global co-head of high-yield alongside partner Michael Chernick and capital markets partner Jeffrey Pellegrino.
This was not the first team the Magic Circle firm had broken its lockstep for in the past 12 months. It hired a three-partner team in New York in July last year from White & Case led by global co-head of leveraged finance Scott Zemser who joined with three other partners and an associate who was made up to partner in the move. The firm refused to comment on the size of the package.
The Magic Circle firm requires the go-ahead from 75% of all partners voting in order to bring in a new partner. Should the firm want to use the bonus pool, the voting papers will outline this intention.
‘We’ve closed each of the votes early. How we’ve done that is by getting 75% of all partners to approve,’ senior partner Wim Dejonghe told Legal Business.
The bonus pool, separate to its lockstep, was brought in almost two years ago to both help retain and bring in leading talent. The firm’s overall lockstep remains unaltered and continues to run from 20 points, up two points each year, to a maximum of 50.
Managing partner Andrew Ballheimer said: ‘As the markets converge, who’s going to emerge as a global player? Because our franchise is incredibly strong in the finance space, A&O is clearly a central player in that market. The missing piece is in the States in terms of bench strength. Now, having hired eight people, it’s transformative. Fast forward five years and the protagonists in finance internationally will be us, Latham and one other.’
A&O is still looking to grow in M&A, private equity, litigation and restructuring in the US and Dejonghe said the firm would not rule out breaking lockstep again: ‘If they’re the right people, we won’t stop doing it. Ultimately lockstep remains our logic but obviously if you want to play in the market, you have to be able to match market conditions.’
The firm has been aggressively hiring in the region, also bringing in investigations and litigation partners Gregory Mocek and Anthony Mansfield from Cadwalader, Wickersham & Taft in January and Eugene Ingoglia from Morvillo Law in February. Mocek and Mansfield join A&O’s Washington DC office while Ingoglia is based in New York.
madeleine.farman@legalease.co.uk