Bids create pounds 300m fee bonanza for lawyers

City law firms reaped rich rewards from last year's boom in takeover activity by scooping a record pounds 300m in fees, a 50 per cent increase from 1995.

This upturn in business has led to an explosion in vacancies at law firms, driving salaries higher and boosting the earnings of partners at the firms.

"I would have expected partners to have had one of their best years for quite a number of years," said David Woolfson, recruitment consultant at Chambers, a leading firm of recruitment experts for lawyers.

The legal data compiled by Acquisitions Monthly follow calculations by Philip Healey, editor of the magazine, that total fees paid out for mergers and acquisitions in the UK reached a record pounds 1.1bn in 1996. This figure includes fees paid to investment bankers, lawyers, accountants and public relations advisers,

Last year created a good environment for mergers because the stock market soared and interest rates were low. This makes deals less earnings-dilutive for the buyer.

Deals were also driven by expectations that a Labour government would be elected this year and alter taxation and competition policy.

In 1997, City lawyers expect business to remain brisk, although Nigel Boardman, partner at Slaughter & May, which was ranked second in Acquisitions Monthly's tables, thinks the election may lead to a slowdown in activity during 1997.

The rankings are based on the value of mergers between UK firms on which the law firms advised, rather than the number of deals.

Slaughter & May advised on 25 deals, the largest number, but was second in the table because their value amounted to pounds 16.26bn.

Linklaters & Paines took first place by advising on 19 deals worth pounds 19.02bn. It advised on a number of pounds 1bn-plus deals such as Royal Insurance's pounds 2.4bn merger with Sun Alliance, and ousted Freshfields, the City firm run by Anthony Salz, a mergers and acquisitions specialist, from the top slot.

Freshfields fell to third with 17 deals worth pounds 9.46bn. Barry O'Brien, head of corporate finance at Freshfields, said: "We are not surprised by our position in these tables since we started the year by being conflicted out of both sides of the pounds 3.6bn Granada-Forte bid."

"Perhaps more importantly, we have also advised on over pounds 16bn of US-UK mergers, such as Premier-Farnell and BT-MCI, which did not even qualify for the tables [because they took place outside the UK]."

While the the mergers during 1996 were not as large as in previous years, they were more complex, which helped generate higher fees for the law firms involved.

"The increasing complexity of deals meant that last year was even better than 1995 in terms of boosting the coffers of leading law firms," said Mr Healey.

Mr Boardman of Slaughter & May said: "There were fewer mega-deals in 1996 but a larger level of overall activity. It's been an active year. It's been a good year."

He now expects continued activity in sectors where further consolidation is needed, such as engineering and financial services, but said changes to competition policy after the election could slow down such consolidation.

A number of bids between engineering companies are already under way, such as Triplex Lloyd's offer for William Cook, FKI's bid for Newman Tonks and Fairey's move for Burnfield.

In other sectors, Gulf Canada is bidding for Clyde Petroleum and Ashquay is chasing UK Estates.

Anthony Cann, head of the corporate department at Linklaters & Paines, expects the healthy start to the year to continue even though the general election later this year may lead to a pause in domestic business. Outside the UK, he predicts that merger business will soar.

Law firms do not publish profit figures but recent research by Legal Business, a specialist magazine, confirms that 1996 was one of the best for firms in recent years.

Top legal advisers for UK public takeovers

Legal adviser No of deals Value pounds m

1 Linklaters & Paines (3) 19 19,016

2 Slaughter and May (2) 25 16,260

3 Freshfields (1) 17 9,457

4 Ashurst Morris Crisp (13) 15 8,986

5 Allen & Overy (8) 15 8,768

6 Herbert Smith (4) 17 6,258

7 Macfarlanes (14) 7 5,976

8 Lovell White Durrant (6) 5 5,667

9 Clifford Chance (5) 15 4,595

10 Denton Hall (11) 2 3,688

Numbers in brackets refer to league position last year.

Source: `Acquisitions Monthly'

PROMOTED VIDEO
Arts and Entertainment
Standing the test of time: Michael J Fox and Christopher Lloyd in 'Back to the Future'
filmReview: A week late, Secret Cinema arrives as interactive screening goes Back to the Future
News
Chancellor George Osborne, along with the Prime Minister, have been 'complacently claiming the economy is now fixed', according to shadow Chancellor Ed Balls
i100... which is awkward, because he is their boss, after all
Travel
travel
Arts and Entertainment
Sydney and Melbourne are locked in a row over giant milk crates
artCultural relations between Sydney and Melbourne soured by row over milk crate art instillation
Arts and Entertainment
Adèle Exarchopoulos and Léa Seydoux play teeneage lovers in the French erotic drama 'Blue Is The Warmest Colour' - The survey found four times as many women admitting to same-sex experiences than 20 years ago
filmBlue Is The Warmest Colour, Bojack Horseman and Hobbit on the way
Arts and Entertainment
Preparations begin for Edinburgh Festival 2014
Edinburgh festivalAll the best shows to see at Edinburgh this year
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
i100
News
Kenny Ireland, pictured in 2010.
peopleBenidorm, actor was just 68
Environment
View from the Llanberis Track to the mountain lake Llyn
Du’r Arddu
environmentA large chunk of Mount Snowdon, in north Wales, is up for sale
Arts and Entertainment
arts + ents
News
Morrissey pictured in 2013
people
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Financial Analyst - Forecasting - Yorkshire

£300 - £350 per day: Orgtel: Financial Analyst, Forecasting, Halifax, Banking,...

Business Architect - Bristol - £500 per day

£500 per day: Orgtel: Business Architect - Banking - Bristol - £500 per day A...

Regulatory Reporting-MI-Bank-Cardiff-£300/day

£200 - £500 per day + competitive: Orgtel: I am currently working on a large p...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Day In a Page

Dress the Gaza situation up all you like, but the truth hurts

Robert Fisk on Gaza conflict

Dress the situation up all you like, but the truth hurts
Save the tiger: Tiger, tiger burning less brightly as numbers plummet

Tiger, tiger burning less brightly

When William Blake wrote his famous poem there were probably more than 100,000 tigers in the wild. These days they probably number around 3,200
5 News's Andy Bell retraces his grandfather's steps on the First World War battlefields

In grandfather's footsteps

5 News's political editor Andy Bell only knows his grandfather from the compelling diary he kept during WWI. But when he returned to the killing fields where Edwin Vaughan suffered so much, his ancestor came to life
Lifestyle guru Martha Stewart reveals she has flying robot ... to take photos of her farm

Martha Stewart has flying robot

The lifestyle guru used the drone to get a bird's eye view her 153-acre farm in Bedford, New York
Former Labour minister Meg Hillier has demanded 'pootling lanes' for women cyclists

Do women cyclists need 'pootling lanes'?

Simon Usborne (who's more of a hurtler) explains why winning the space race is key to happy riding
A tale of two presidents: George W Bush downs his paintbrush to pen father’s life story

A tale of two presidents

George W Bush downs his paintbrush to pen father’s life story
Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover

The dining car makes a comeback

Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover
Gallery rage: How are institutions tackling the discomfort of overcrowding this summer?

Gallery rage

How are institutions tackling the discomfort of overcrowding this summer?
Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players

Eye on the prize

Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players
Women's rugby: Tamara Taylor adds fuel to the ire in quest to land World Cup

Women's rugby

Tamara Taylor adds fuel to the ire in quest to land World Cup
Save the tiger: The day America’s love of backyard tigers led to a horrific bloodbath

The day America’s love of backyard tigers led to a horrific bloodbath

With only six per cent of the US population of these amazing big cats held in zoos, the Zanesville incident in 2011 was inevitable
Samuel Beckett's biographer reveals secrets of the writer's time as a French Resistance spy

How Samuel Beckett became a French Resistance spy

As this year's Samuel Beckett festival opens in Enniskillen, James Knowlson, recalls how the Irish writer risked his life for liberty and narrowly escaped capture by the Gestapo
We will remember them: relatives still honour those who fought in the Great War

We will remember them

Relatives still honour those who fought in the Great War
Star Wars Episode VII is being shot on film - and now Kodak is launching a last-ditch bid to keep celluloid alive

Kodak's last-ditch bid to keep celluloid alive

Director J J Abrams and a few digital refuseniks shoot movies on film. Simon Usborne wonders what the fuss is about
Once stilted and melodramatic, Hollywood is giving acting in video games a makeover

Acting in video games gets a makeover

David Crookes meets two of the genre's most popular voices