US law firms are pushing ahead with their bid to dominate the City of London’s legal scene.
Latham & Watkins, the world’s second-largest law firm by revenue, is just one such firm targeting the UK market.
Last year, Latham poached top capital markets lawyer Mark Austin from Freshfields Bruckhaus Deringer, a member of the “magic circle” — a term used to describe five elite UK law firms.
While he wasn’t the first lawyer in the City to depart for a US company, the move for Austin, who had worked on the listings of companies like Deliveroo, was big.
“To get the guy who has the longest IPO list in the country and is now synonymous with the capital markets through his work with the government . . . was a big hire,” one partner at a magic circle firm told the Financial Times.
Latham & Watkins now counts almost 500 lawyers in its London office, according to its website. It has lured at least 15 partners from rivals in the City over the last three years, the FT reported.
The firm has also been involved in a number of high-profile deals in the capital this year, including advising UK cybersecurity company Darktrace plc on its $5.3 billion acquisition by Thoma Bravo.
Latham’s aggressive plays point to a wider trend in the industry that is seeing elite UK firms forced into submission by more profitable US counterparts.
“The problem for UK firms is that there is only so much truly premium local legal work around,” Scott Gibson, a director at London legal recruiting firm Edwards Gibson, told Bloomberg Law.
“As long as US private equity continues to drive the market, the rest of the UK global elite will keep trying to break the US. They have no choice if they want to stay elite,” he added.
And thanks to a weakened pound post-Brexit, it has been easier than ever for US firms to attract British legal talent.
Earlier this month, US firm Quinn Emanuel raised its starting salaries for junior lawyers in the UK to £180,000, or nearly $230,000, putting pressure on others to follow suit.
The move followed news that UK firm Freshfields Bruckhaus Deringer had increased base pay for new lawyers to £150,000, which is around $192,000.
Another blow to the magic circle came in May 2023, when another elite UK firm, Allen & Overy, merged with New York-based Shearman & Sterling, creating a huge new firm with around 3,900 lawyers and 800 Partners across 49 offices.
It remains to be seen how the rest of the magic circle will try to keep pace with the US.
Read the full article here
