Editors' Blog

Everyone's a winner...or not

Posted 10/01/2007 by Legal Week

So who is the winner? Kirkland & Ellis for hiring a respected three-partner funds team from SJ Berwin - or SJs’ transactional team for seeing the back of those grumpy folk on the other side of the office?

Kirkland will be the one more likely to pop open the champagne. It is not every day that a smallish London outpost of a US firm hires three top partners from the leading practice of any particular sector. The move completes Kirkland’s push to hire in an all-round private equity offering too, with the office splashing the cash to hire Linklaters private equity duo Raymond McKeeve and Graham White and Allen & Overy acquisition finance partner Stephen Gillespe last year. Presumably the Chicago firm is confident it can secure a chunk of SJ Berwin’s clients, given it has hardly yet established itself as a private equity powerhouse in the UK.

But Kirkland will need to be aware that its hires will have a tremendous capacity to clash, even before accounting for the basic fact that three funds partners might be overkill at such a lean London arm. And not even Kirkland will be used to having an explosive cocktail of fiery Celts and SJ partners.

The team is understood to have been on the market for a while, with Weil Gotshal & Manges known to have talked with some partners of that ilk. This suggests – as if it wasn’t obvious – that all is not well at 10 Queen Street Place. A well-documented tension between the funds and transactional departments is even understood to have been evident at the firm’s Christmas party, where - as one assistant put it - the funds lot left early and ignored everyone.

Still, as one rival points out, a year ago the firm’s three best-known funds partners were Jonathan Blake (now senior partner), Blair Thompson (now at a client) and Mark Mifsud.

Yet ultimately the most likely winner looks to be Clifford Chance (CC). As the only credible competitor to SJ Berwin’s once-unchallenged fund practice in recent years, the firm now has a free run at becoming the dominant force.To further reinforce CC's case, the European private equity market is becoming increasingly American in its approach. This model usually sees clients turn to the same firm for both funds and transactional advice. And Europe’s leading transactional buy-out firm is…you guessed it: CC.

paul.hodkinson@legalweek.com