Our inbox has been awash with news of newly hired private equity lawyers, or counsel switching firms. Around a dozen lawyers were reported to have been hired in January, up from three last year.
The movers included Joshua Tod, who joined Gibson, Dunn & Crutcher as counsel from Simpson Thacher & Bartlett, and Marie-Laure Bruneel, who joined Goodwin Procter’s private equity fund practice from De Pardieu Brocas Maffei.
One reason for the boom is the continued growth and buoyancy of the private equity industry, and confidence it will remain on its current trajectory.
“I think that many of the recent moves reflect the continuing success of the private equity sector, optimism about its future, and London’s continuing position as a hub in that market,” Simon Witney, consultant at Debevoise & Plimpton, tells pfm. “As the sector thrives, it attracts high-caliber lawyers and provides opportunities for them to work – and those lawyers are therefore highly sought-after. I think that is what we are seeing at the moment; a natural symptom of a busy and stimulating area of legal practice.”
In the legal world, as in many industries, hiring can be cyclical. This is not the first time the sector has seen a widespread shake-up, other sources say.
“Fifteen years ago there were three or four leading fund practices in London. Most of them were not global or magic circle firms,” says Geoffrey Kittredge, partner at Debevoise & Plimpton.
They included SJ Berwin, Ashurst and MacFarlanes, and magic circle firm Clifford Chance.
As the private equity funds market increased, and investors began to increase their allocations to the asset class, law firms with strong M&A practices started to realize they could benefit from having a complementary fund formation practice.
“It takes fewer bodies to reach a level of market recognition in the fund formation space than in many other areas of practice, banking for example,” Kittredge says.
As more law firms began to set up shop in the UK, private fund lawyers had more opportunity to move. People began to join the US firms that were setting up practices across the ponds a result of the growing market.
Among the big names to switch to American outfits were John Daghlian, who left SJ Berwin and now heads O’Melveny Myers’ investment funds practice, and Mark Mifsud and Richard Watkins, who moved to Kirkland & Ellis from SJ Berwin.
And those were merely the first steps towards a private funds legal space that has changed beyond recognition.
“Most of the leading fund practices in the UK now are at US firms. Fund lawyers have more options as to where to practice, and to do so with credible firms,” Kittredge says.