http://www.legal500.com

Legal 500 commentary:

The leading finance firm in the City along with Clifford Chance, and an international force to be reckoned with, Allen & Overy LLP remains the firm of choice for major investment banks and financial institutions on innovative and complex deals. It sweeps the board in all the key finance areas, from acquisition finance to banking litigation, but the firm is also dedicated to gold-standard service and this extends to all practice areas. It has more top-tier rankings than most other firms this year, and is one of the top advisers to FTSE100 companies. The firm’s European M&A practice rivals that of the traditional market-leaders, and an excellent year, culminated in winning a role as co-counsel to ABN Amro in its potential £45bn merger with Barclays. The firm’s decision to ditch its approach of paying bonuses at the same levels across all departments has led to a streamlined, more competitive outfit, at the top of the market for assistants’ salaries and bonuses; it has stemmed the tide of departures and neutered the attraction of the high-paying US firms, making it a much happier ship. The firm rises to the top tier in corporate tax this year, and is new to the aviation regulatory section.

The number one global firm according to many observers, Clifford Chance tops so many categories that it can be comfortably described as the definitive all-rounder. While Linklaters LLP, Freshfields Bruckhaus Deringer and Slaughter and May may rank slightly higher in some corporate fields, it is pre-eminent in the finance arena alongside Allen & Overy LLP, and no other firm offers a more consistent and broader practice at the highest level. The firm’s top ten clients a decade ago remain the firm’s top ten clients now, and things have never looked rosier - the firm’s PEP topped £1m for the first time in history, at the same time as it became the largest-grossing law firm in the world. This continued success is reflected by a raft of promotions in various tables this year; the firm is up in corporate tax, public international law, derivatives, Islamic finance, healthcare, environment, property litigation and broadcasting, and is newly ranked in the healthcare section.

Leaner and hungrier than ever before, Freshfields Bruckhaus Deringer revitalised its partnership structure and partner pension scheme in 2006, boosting profits and incentivising younger lawyers. Finance remains a relative area of weakness for this international juggernaut; while it dominates both at home and abroad in most practice areas and has made great strides in finance work in recent years, it remains some way behind Allen & Overy LLP, Clifford Chance and Linklaters LLP in winning the top-level finance mandates, and it recently lost acquisition an property finance expert David Ereira and key banking partner Brinn Gray to Linklaters LLP . On virtually everything else it is truly awesome. It leads the field for M&A, private equity and equity capital markets work, acting on the biggest deals to come into the market in the UK, Europe and Asia and regularly topping M&A and IPO league tables by volume and aggregate value of deals. It was named corporate team of the year at the 2007 Legal Business awards, for Xstrata’s US$14.6bn takeover of Falconbridge. It is arguably the strongest competition firm in the world. Its fearsome litigation practice won dispute resolution team of the yearat the Legal Business awards,and the firm has been promoted this year in corporate restructuring, employment, insurance insolvency and intellectual property, as well as being newly ranked for health and safety.

With a truly outstanding global profile and unrivalled strength in most key practice areas, Linklaters LLP offers clients strength in depth that few others can match and a balance sheet that all rivals try to emulate. Its financial performance continues to put others in the shade, with a 20% increase in turnover and profits per equity partner (PEP) leading the field at nearly £1.3m. The firm regularly tops M&A and IPO deals tables across various regions, and in both areas the firm is second to none. While traditionally regarded as a blue-chip firm, the description is no longer appropriate as it gives rivals Allen & Overy LLP and Clifford Chance more than a run for their money on finance deals, and has arguably made a better fist of developing a pre-eminent global finance practice than fellow corporate giants Freshfields Bruckhaus Deringer and Slaughter and May . It is perhaps the only UK law firm that can legitimately claim to be a market leader in M&A, banking and capital markets. It was named banking and finance team of the year at the 2007 Legal Business awards, and also won the corporate tax team of the year award. After another superb year, the firm is promoted in banking litigation, restructuring, employment, pensions and environment, and features at the head of our new emerging markets section.

Slaughter and May is notably smaller than the rest of the Magic Circle, with under 700 fee-earners, and is distinguished by the quality and versatility of its partners, its relationships with top UK corporates, its profitability, and its staunchly independent status and ‘best-friends’ international strategy. Key M&A clients in 2006 included Corus (advised on the offers by Tata Steel and CSN) and RWE AG (on its £4.8bn sale of Thames Water), alongside Bertelsmann, Abbey National and BOC, while finance deals included Arsenal FC’s award-winning securitisation and the demutualisation and IPO of Standard Life, although its work for corporates should not obscure the continuing development of its institutional relationships with the likes of Goldman Sachs and Merrill Lynch. The firm has market-leading practices in competition and corporate tax, as well as M&A, and ranks very highly for asset finance, bank lending, corporate restructuring, financial services, corporate insurance, and commercial and investment banking litigation. It was named financial services and insurance team of the year at this year’s Legal Business awards, and moves up in fraud (commercial), commercial property (development and investment), IT, and aviation (regulatory), as well as being newly recommended in publishing.

While Herbert Smith LLP’s outstanding reputation for dispute resolution, energy and regulatory work endures, stunning performances in corporate and real estate in recent years mean the firm has rivals anxious in the boardroom as well as the courtroom. While not as prolific as larger firms in M&A and equity capital markets, its average deal size is up there with the best; cases in point include roles advising Tata Steel £6.2bn takeover of Corus, and on its Merrill Lynch and UBS in Standard Life’s demutualisation and £4.5bn listing on the London Stock Exchange. Significant lateral hires in environment and IP have led to improved rankings, and while finance remains an area where the firm has most scope for improvement, its impressive progress has earned higher rankings in acquisition finance and bank lending, while other other key promotions include employment and planning, along with a new ranking for mining. The announced departure of property finance specialist and widely acknowledged expert Chris de Pury next year to Berwin Leighton Paisner LLP was a real blow.

Ashurst is a top ten stalwart, with a private equity practice that is the envy of most rivals. While the firm has long been a top performer in corporate, it is the finance practice that has come on leaps and bounds this year. It moves up in project finance, an area that the firm has made great progress in along with PFI. It also shows well in construction, and earns a notable promotion in our commercial property table. Excellent profitability, a content partnership and outstanding quality of work mean that the firm often rivals the Magic Circle, and there is clear water between it and the chasing pack. The firm opened a new office in Stockholm in 2007, to take advantage of the fast-growing Nordic private equity market. At this year’s Legal Business awards, it won law firm of the year, private equity team of the year, and (with Jones Day and Lovells LLP ) competition team of the year.

Lovells LLP continues to perform extremely well. In 2007, it made up an unusually large number of partners: 31 promotions, all but replacing the partners who left in 2006. One of the most credible alternatives to the Magic Circle, it is able to compete with the very best: advising ITV in its much-publicised takeover wrangles is a good example. Real estate remains its signature practice, and it won real estate team of the year at the 2007 Legal Business awards.It also has superb dispute resolution and insurance practices, and won the competition team of the year award alongside Ashurst and Jones Day . Significant ranking improvements this year include recognition of its sterling performance in commercial litigation, and promotions in acquisition and property finance, and securitisation.

Norton Rose remains one of the leading City firms, although, while its revenue may be matching the other top ten firms, it has been dogged by sluggish profitability as well as an inability to hold on to the best of its talent. On the plus side, the firm, whose ‘headlight’ areas are corporate finance, energy and infrastructure, financial institutions, technology and transport, finally broke the £500,000 mark for average PEP in 2007, a 16% rise, and it maintains a leading practice for Islamic finance and asset finance, as well as mining. It is known for having a legion of contented associates, buoyed by the equitable culture of the firm and better partnership prospects than elsewhere. The firm moves up this year in our IP table and gains a new listing in our insurance insolvency table.

Simmons & Simmons’ announced strategy is to focus on four key areas: financial services, which is the firm’s largest sector and accounts for around half of the firm’s total fee income; energy and infrastructure, where recent deals include US$3.5bn bond issues for Abu Dhabi National Energy Company and three major PFI defence projects; life sciences, where it now acts for 15 of the top 20 global pharmaceutical companies; and TMT. In addition to pharmaceuticals and biotechnology, it has top-tier offerings in employment, hedge funds and futures, and has strength across health and safety, EU and competition (particularly on the regulatory side), commercial and investment banking litigation, and administrative and public law, as well as, on the finance side, equity capital markets, debt capital markets (particularly in the emerging markets), asset finance and securitisation. On the international side, its growth is focused on the Middle East, in Abu Dhabi and Qatar. The firm moves up in the acquisition finance, oil and gas, environment and IT rankings this year, as well as being newly recommended in private equity (funds) and mining.