Editors' Blog

Oddly, Halliwells fires an unwelcome starting gun

Posted 27/02/2008 by Deal Comment

Not very impressively for a paid-up pundit, I wouldn’t have guessed Halliwells would be the first. While it has looked likely for some time that the current slowdown would see some retrenchment at the offices of new and newish entrants to the competitive City market, the expansive Manchester-based Halliwells didn’t look top of the list.

True, the ambitious firm still gets more than its fair share of sniping from rivals and critics would argue it could have done more to mature its practice to reflect its greatly-enlarged scale. But Halliwells still seems to have got a lot more right than wrong over the last five years.

Likewise, the firm has been putting in sustained investment in the City for a decade now, including hiring three corporate partners over the last 18 months, and its corporate practice has maintained a decent profile in the coveted Alternative Investment Market. Only last summer, managing partner Ian Austin was hailing the firm’s ambitions to “build a top-tier corporate capability in London” while pledging the investment will continue.

But, for the moment at least, Halliwells is set for a change of direction. As exclusively revealed today on legalweek.com, the firm has launched a consultation that is set to lead to redundancies in London and the likely closure of two small teams.

In addition, Halliwells’ board has decided to substantially shift its City strategy to focus on property, litigation and dispute resolution. In the firm’s own words, “the London corporate practice supports and complements those core growth areas”.

For a firm that has managed such consistent growth it is a surprise. However, it seems apparent that a recent struggle by the corporate team to hit its targets has contributed to a considerable slowdown in the firm’s growth, though Halliwells still expects a small increase on its 2006-07 turnover this year. Current indications are that less than 10 lawyer and support staff jobs will be lost in London.

Yet, if it is unexpected that it is the entrepreneurial Halliwells that has fallen foul of the current slowdown, it has looked a racing certainty for some time that some out-of-towners were facing a very challenging environment. As such, it was interesting to see Howrey announce a sensible refocusing of its City practice away from litigation towards its brand practices of antitrust and intellectual property.

And there are plenty of firms out there that look in a tougher position than either Halliwells or Howrey. The expectation is that some of the more incoherently-executed City launches that have been seen over the last three years from US firms will be forced to make some similarly drastic decisions. You know who they are.

alex.novarese@legalweek.com