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Dechert wins big at PDI awards

The law firm swept the board in sister publication Private Debt Investor's annual awards.

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Law firm Dechert swept the board at this year’s Private Debt Investor awards, being honoured as law firm of the year in three different regions.

Law firm of the year – The Americas

1. Dechert
2. Paul Hastings
3. Ropes & Gray

Dechert has now won this award for three years in a row. The firm served as legal advisor to FS Investments in its move to form a joint venture with KKR to run FS Investment Corporation. FS and current sub-advisor, GSO Capital Partners, plan to sever ties. The firm also helped KKR’s Corporate Capital Trust’s public listing, one of two to do so in 2017. However, investors are looking more closely at such private vehicles. “The private BDC has become an interesting vehicle that clients are wanting to hear more about,” says partner Thomas Friedmann, citing tax advantages as one reason investors might like a private BDC over a traditional private fund.

Law firm of the year – Europe

1. Dechert
2. Paul Hastings
3. Macfarlanes

“What we are good at is helping our clients do what they want to do,” says Gus Black, partner and global co-chairman of Dechert’s financial services group. In 2017, this included plenty of structuring of direct deals and co-investments, as well as helping investors gain access to niche strategies.

Among the firm’s structuring activities last year were establishing a closed-ended master feeder structure in Delaware and Cayman investing in US oil and gas royalties for a European special situations manager; and advising on the launch of two closed-ended loan origination funds available to US tax-exempt, US tax-paying and international investors. On the deals front, Dechert advised on a number of transactions completed by Ares Management and also on CVC Credit Partners’ provision of facilities for the TWMA Group deal.

Reflecting on the way in which Dechert pushed hard into private debt following the GFC, Black says: “Relatively few law firms have put a huge emphasis on private debt in the way we have. A lot have legacy banking practices and have been slower to see the evolution from banks to alternative lenders.”

Law firm of the year – Asia

1. Dechert
2. Hogan Lovells
3. King & Wood Mallesons

In addition to providing deal structuring advice to private debt managers, Dechert has a strong track record of fund formation mandates in Asia. The team, based in Singapore and Hong Kong, works as part of a 200-strong global fund formation effort.

Funds established last year included those targeting direct lending and distressed debt. Dean Collins, from Dechert’s Singapore office, led the establishment of a $500 million fund focused on Chinese non-performing loans for a London-based investment firm. The vehicle was formed in conjunction with a Chinese asset management company.

“We continue to see the growth of private credit in Asia and are making sure that all of the technology and experience gained from our colleagues in the US and Europe is appropriately applied and adapted for the Asian markets,” says Collins.

In terms of fundraising, Dechert is seeing more mandates involving Asian private credit managers trying to raise funds in Europe, which often requires a different approach. “Because investor preferences and the regulatory environment have evolved in Europe, it is harder to solely raise a Cayman vehicle,” Collins says, adding that more sponsors are setting up European structures in parallel with their Cayman Islands-domiciled structures.