Top magic circle partner makes switch to investment banking

A top magic circle partner is making the switch from a life in law to one in investment banking.

Charlie Jacobs, the senior partner at magic circle firm Linklaters, is set to join global investment bank, JP Morgan. According to a statement by the mega-bank, Jacobs will assume the role of co-head of UK investment banking.

The somewhat unusual move to finance comes after South African-born Jacobs recently celebrated 30 years at the elite law firm. He made partner in 1999 and was elected to senior partner in 2016.

At JP Morgan, Jacobs will reportedly advise blue-chip UK companies on the challenges arising from a post-Brexit market and recovery from the COVID-19 crisis. The M&A specialist will reportedly take up his new banking gig later this summer.

A Linklaters spokesperson said:

“We can confirm that, once his term as senior partner ends, Charlie Jacobs will be taking on a new role as co-head of J.P. Morgan Cazenove’s U.K. investment banking operations. Whilst Charlie will not be starting at J.P. Morgan until later in the year, we look forward to staying in touch with him once he begins his new role.”

News of the move comes just a week after JP Morgan announced the appointment of City solicitor turned politician Chuka Umunna as its head of environmental, social and corporate governance (ESG) in c

DLA fails in effort to stay €12m negligence claim

A High Court judge has refused international firm DLA Piper’s request to stay a €12m professional negligence claim brought against it by a Russian cruise ship company.

Applying principles of Russian law, David Edwards QC, sitting as a High Court judge, said that an arbitration agreement between Premier Cruises Ltd (PCL) and DLA Piper Russia did not apply retrospectively to the subject of the negligence action.

PCL entered into a contract with a Croatian shipyard, Brodosplit, in June 2013 for the construction and purchase of a cruise liner to be called Volga Dream II. The delivery date was March 2015 and the purchase price was €20m.

The judge said the relationship between the shipyard and PCL deteriorated when, towards the end of 2014, the shipyard sought to postpone the delivery date.

With advice from DLA Russia, under what PCL says was an implied retainer, PCL sent a notice of rescission to the shipyard in April 2015.

The shipyard responded by alleging that PCL did not have a contractual right to terminate the shipbuilding contract and PCL had failed to pay the fifth instalment of the purchase price.

The shipyard said it was rescinding the contract or treating PCL’s notice of rescission as a repudiatory breach, which it accepted, bringing the contract to an end.

DLA Russia then contacted the law firm’s London office and a formal engagement letter was sent to PCL, including an arbitration clause for all disputes and disagreements arising under it.

Hill Dickinson, the shipyard’s solicitors, commenced arbitration proceedings later in 2015 and, following a hearing in London in May 2016, the tribunal ruled that PCL must pay the fifth instalment and compensation. PCL paid the shipyard €4.4m in July 2019.

PCL launched proceedings against DLA Piper for professional negligence in January last year, with separate claims against DLA Russia and DLA UK.

Delivering judgment in Premier Cruises Limited v DLA Piper Rus Limited and another [2021] EWHC 151 (Comm), Mr Edwards said PCL claimed it had been given negligent advice by DLA Russia between December 2014 and April 2015 in relation to the termination provisions of the shipbuilding contract and in drafting the notice of rescission.

PCL’s claim against DLA UK was for negligence from May 2015 in failing to advise PCL of the risks in defending the shipyard’s claims. The damages claimed was “in excess of €12m”.

Mr Edwards said DLA Russia applied for a stay of the claim under section 9 of the Arbitration Act 1996, relying on the dispute resolution section of its engagement letter.

Meanwhile DLA UK, which was not a party to the arbitration agreement, applied for a case management stay.

The judge said that, under section 9(1), a party could apply for a stay “in respect of a matter which under the agreement is to be referred to arbitration”.

He said “matter” had been defined as “any issue which is capable of constituting a dispute or difference which may fall within the scope of an arbitration agreement”.

The question was whether the agreement extended to “advice allegedly given and the work allegedly carried out” by the law firm before the engagement letter and arbitration clause, which was governed by Russian law, came into effect.

The High Court heard expert evidence from two Moscow lawyers on the principles of construction applicable to the arbitration agreement – both managing partners of Russian law firms.

Mr Edwards concluded that “the matter which is the subject of the present proceedings against DLA Russia” was not within the scope of the arbitration agreement. He dismissed DLA Russia’s application for a stay.

The judge also dismissed DLA UK’s application for a case management stay.

CNPLaw Business Guide Series

1. Choosing your business vehicle If you are looking to do business in Singapore, you can choose to set up a business vehicle which comes in different forms, such as a sole proprietorship, a partnership, a business trust or a branch of a foreign company. However, the most common form is a private company limited by shares (“company”). This article focuses on typical considerations for incorporating a company in Singapore. 2. What is a private company limited by shares? A private company limited by shares is a legal entity with up to 50 shareholders whose liability is limited to the amount to be paid up on their respective shares in the company. It has a legal personality separate from its shareholders and directors (who are generally not liable for the company’s debts) and has the capacity to sue or be sued and to hold assets in its own name. 3. Incorporation requirements Below is summary of the key requirements for incorporating a company in Singapore. A. Licences

  • Generally, no licence is required to incorporate a company in Singapore.
  • However, certain business activities may require specific licences or permits to be obtained from relevant government agencies before a company can operate, particularly in regulated industries, such as finance, insurance, import trade, etc. This should be considered before incorporating a company in Singapore.

B. Directors

  • There must be at least 1 local director resident in Singapore (e.g. a Singapore citizen, Singapore permanent resident or a Singapore employment pass holder).
  • An overseas foreigner can be a director, provided that there is at least 1 local director as stated above.
  • A director must be at least 18 years old with full legal capacity and not disqualified from acting as a director (e.g. not an undischarged bankrupt).

C. Shareholders

  • The minimum number of shareholders is 1 and the maximum number of shareholders is 50.
  • A shareholder can be an individual or a legal entity, whether local or foreign.

D. Secretary

  • At least 1 secretary must be appointed within 6 months after the incorporation of the company to maintain the corporate records of the company.
  • A secretary must be a local individual resident in Singapore who is qualified to act as a secretary (e.g. a Singapore lawyer or public accountant).
  • If a company only has 1 director, such director cannot also act as the secretary.

E. Auditors

  • A company must appoint auditors within 3 months after the incorporation of the company, unless it is exempt from audit requirements.
  • A company is exempt from audit requirements if it is:
    • a small company, i.e. it is a private company throughout a particular financial year and satisfies any 2 of the following 3 criteria for each of the past 2 financial years: (A) its revenue does not exceed S$10 million; (B) the value of its total assets does not exceed S$10 million; and (C) it has not more than 50 employees; or
    • part of a small group, i.e. a group that satisfies at least 2 of the above criteria on a consolidated basis for the past 2 financial years.

F. Share capital

  • The minimum number of shares is 1 which can have a paid-up capital as low as S$1 (or in such other major currency, such as US$).
  • The share capital can comprise different classes of shares (e.g. ordinary shares and preference shares).

G. Registered address

  • A company must have a local registered address in Singapore which can be at a commercial property or, if approved under the Home Office Scheme, a private residential property.
  • The registered address must be operational but need not be where the company conducts its activities.

H. Constitution

  • A company must have a constitution (previously known as its memorandum and articles of association).
  • The constitution is a public document which governs the company and can be in the form of the model constitution provided by the Companies Act or customised based on specific requirements.
  • If the shareholders also enter into a private shareholders’ agreement to govern the company, it is recommended that the constitution be amended for consistency with such shareholders’ agreement to avoid conflicting provisions.

3. Other considerations A. Bank account

  • A company can open a corporate bank account in Singapore once it is incorporated.
  • Typically, the banks in Singapore will require face-to-face meetings with the directors for verification purposes.

B. Annual maintenance A company must comply with annual maintenance requirements, including:

  • holding its annual general meeting within 6 months after its financial year end, unless the shareholders resolve to dispense with such requirement;
  • filing its annual return with the Accounting and Corporate Regulatory Authority of Singapore (“ACRA”) within 7 months after its financial year end; and
  • filing its income tax return with the Inland Revenue Authority of Singapore by 30 November every year.

C. Corporate tax

  • Corporate tax in Singapore is levied at a flat rate of 17% on chargeable income (i.e. taxable revenues less deductible expenses).
  • All dividends paid by a company to its shareholders are exempt from taxation.
  • There is no capital gains tax in Singapore.
  • The Tax Exemption Scheme is available for qualifying new start-up companies for their first 3 years of assessment. It provides 75% tax exemption on the company’s first S$100,000 of chargeable income and a further 50% tax exemption on the next S$100,000 of chargeable income. To qualify, a company must be a tax resident and have no more than 20 shareholders with all shareholders being individuals or 1 individual shareholder holding at least 10% of its shares. Property and investment holding companies are not eligible.

4. Incorporation process The incorporation process takes place on ACRA’s BizFile e-portal (“ACRA portal”) which is accessible via a CorpPass or a SingPass issued to local entities or individuals respectively. An overseas foreigner should therefore engage a filing agent registered with ACRA (e.g. a Singapore law firm or accounting firm) to assist with the incorporation process. A. Name reservation

  • The name of a company must be reserved on the ACRA portal before it can be incorporated.
  • The name cannot be identical to the name of an existing business, undesirable (e.g. offensive) or prohibited.
  • The name reservation can usually be completed in 1 day whereby the name will be reserved for up to 120 days.

B. Application

  • The proposed shareholders, directors and secretary must provide and/or sign certain documents to incorporate the company, e.g. the first board resolution, constitution, share certificates, consents to act as director or secretary, copies of valid passports or identity cards, recent proof of address, etc.
  • Based on such documents, the application to incorporate the company can be submitted on the ACRA portal with approval usually granted on the same day.

Disclaimer: This update is provided to you for general information and should not be relied upon as legal advice.

Authors: Ken ChiaHazel HoSylvia Koh and Pearlene Han. Our Practice: Corporate Advisory. Read the article here instead to view the infographic

Eliza Low named Partner at MDP Law

Melbourne, February 8th, 2021 —Eliza Low was promoted to Partner at mdp Law after six months as Special Counsel.

Eliza’s exposure to large scale, multi-jurisdiction deals as a Senior Associate at Baker McKenzie, combined with her extensive corporate law experience, marked a significant expansion of mdp’s legal capabilities when she joined in September 2020. Read more

Kirkland & Ellis

Kirkland & Ellis set to hit $5 Billion Annual Revenue

Already the world’s highest-grossing law firm, Kirkland & Ellis has seen strong growth across all of its strongest areas.

Kirkland & Ellis LLP is on track to achieve annual revenue of around $5 billion following an upsurge of demand during the COVID-19 pandemic, the Financial Times first reported.

Insiders at the Chicago-based firm said that its turnover was approaching $5 billion for the twelve months to the end of January, up from $4.45 billion in the previous year. One partner described the firm’s performance as “eye-watering”.

Read more

BSI forecasts 2021 cybersecurity trends

The Consulting Services team at BSI outlines five key trends, among many, across the cybersecurity and data governance landscape for the year ahead, demonstrating how vital information resilience will continue to be for many organizations across the globe in 2021. Read more

Acquisitions mask decline as Knights releases Covid-hit H1 financials

Listed firm Knights may have posted a robust 45% rise in 2021 half-year revenues from £31.9m to £46.2m, but acknowledged that without its slew of acquisitions turnover dropped in real terms from the same period last year by £4.8m (15%).

The results came after a year in which Knights opened in Leeds through the £20.1m buyout of Shulmans, while also establishing a south east presence through the acquisition of ASB Law in a deal worth up to £8.5m. The £8m purchase of Nottingham-based Fraser Brown in February 2020 marked the firm’s tenth acquisition since its listing in June 2018.

Profit before tax was up 13% to £6m, compared to £5.3m for the same period last year. And in further defiance of the difficult trading, the firm’s gross margin matched last year’s pre-Covid levels, at 46%.

CEO David Beech (pictured) told Legal Business: ‘Before Covid we achieved 10% organic growth, so it’s a new impact for us. We knew it was coming in March. It was not a comfortable or pleasant experience for us when it hit. I am sure that organic growth will return this year, particularly through strategic recruitment, but April to July last year was pretty tough.’

However, this morning’s (19 January) results paint a generally good picture of the firm’s financial health – trading improved enough in the latter part of 2020 to fully restore the salaries of all staff by 1 November. At the outset of the pandemic, Knights was among a host of firms to announce salary cuts, in this case, a 10% cut for all staff earning over £30,000.  ‘We restored salaries on the earliest possible day we could’, Beech said.

The accounts bear the full costs of the firm’s Covid-instigated restructuring efforts in March last year and beyond. For the full financial year ending April 2020, Knights spent close to £3m on ‘redundancy and reorganisation costs’. For the first half of 2020/21, the firm has already spent almost £1.1m in similar costs. According to Knights’ report, the costs are part of an effort to ‘streamline the support function of the group following acquisitions’ and ‘as a result of reorganisation actions taken in relation to the impact of Covid-19’.

Knights has continued to expand, entering into the south west market with the £2.1m buyout of Exeter-based OTB Eveling in December. However, this deal did not factor into the H1 results.

Further positive indicators come from the firm’s active recruitment. Throughout the period, Knights hired 18 senior fee earners (partner equivalent) and made 83 internal promotions. Beech commented: ‘Our acquisitions have integrated faster and better than we could have predicted. That quick accessibility to people in their homes meant we could accelerate recruitment and integration – it’s a stable and happy ship.’

And while potentially pre-emptive, even a 15% fall in organic revenue could seem a fair performance once the wider market begins to reveal its own Covid-impacted finances.

Beech looks to the future: ‘There’s going to be lots of activity in the UK later this year, lots of consumer and corporate spend in the summer and autumn. We will be supporting clients as they step up their activity.’

tom.baker@legalbusiness.co.uk

Norton Rose Fulbright cuts 132 roles — majority in London

Norton Rose Fulbright’s London office

Norton Rose Fulbright (NRF) is to cut over 130 roles across its Europe, Middle East and Asia offices, it confirmed on Friday, with London taking the biggest hit.

The international law firm is to make 114 staff redundant in its London HQ, including 19 associates and counsel. The vast majority of cuts affect secretaries and business services staff.

“We have taken the decision to restructure our business services operating model to set us up to lead and thrive in a period of change and uncertainty,” Peter Scott, EMEA managing partner said. “Our resilient performance over 2020 allows us to make these changes now.”

He continued: “Our new operating model will help us serve our clients as effectively and efficiently as possible. Unfortunately, a number of colleagues who have made important contributions will leave us. We have followed a process that is as fair, robust and sensitive as possible, to bring a swift resolution.”

In the wake of the pandemic, a number of major legal players have made job cuts.

In December, Addleshaw Goddard cut 19 lawyer roles across its UK offices following a redundancy consultation, while Reed Smith made thirteen lawyers and six support staff redundant last summer. Other firms to make cuts include Bryan Cave Leighton Paisner, Shoosmiths and Squire Patton Boggs.

Goodwin Procter hires Kirkland & Ellis partner as it bets on M&A upswing

Goodwin Procter has hired M&A lawyer Joshua Zachariah from Kirkland & Ellis as it seeks to ramp up its transactions team in anticipation of a growth in new deals.

Zachariah joins the firm as a partner in Boston, though he will split his time between the firm’s East and West Coast offices given his previous deal-making experience in New York and the San Francisco Bay Area.

Zachariah arrives at Goodwin after a decade as a partner at Kirkland & Ellis in San Francisco. He also spent five years as an associate at Skadden Arps Slate Meagher & Flom in New York.

His experience spans all types of M&A matters for both public companies and private equity clients, including domestic and cross-border deals, joint ventures, strategic investments and take-privates. He also advises on corporate governance and shareholder activism matters.

Over his career, he has advised on more than $100bn of deals, notably in the tech and life sciences sectors.

Stuart Cable, Goodwin’s global M&A chair, said the firm’s strengths in technology, life sciences and private equity put it at a “unique advantage for our M&A clients seeking to capitalise on the new wave of opportunities at the intersection of these disruptive industries”.

Goodwin was third in Mergermarket’s Q1 -Q3 US M&A deal table by volume behind Kirkland & Ellis and Latham & Watkins, advising on 179 deals valued at $38.7bn, up from fourth for the same period last year. It was fifth in the equivalent global ranking – the same ranking it achieved in 2019.

Goodwin has recently advised on mega-deals including Slack’s $27.7bn sale to Salesforce and T-Mobile US’s $26.5bn merger with Sprint Corporation.

In October, it hired licensing partner Adam Bellack in Washington DC from Hogan Lovells to support its ongoing life sciences push and in September it hired a five-partner private equity team from Sidley Austin in London.

Allen & Overy and Khoshaim & Associates end cooperation agreement

Firms will continue to work together but say a looser arrangement suits their strategic needs

Allen & Overy (A&O) and its Saudi Arabian partner Khoshaim & Associates (K&A) have ended their co-operation agreement with both sides stating the benefits of working with a wider range of law firms.

The exclusive agreement was struck in 2012 with Allen & Overy marketing the relationship on its website and through joint announcements. It was quietly shelved on 9 October, although both sides have stressed they will continue to work closely going forward.

“We have seen an increase in the volume and range of matters for which clients are seeking support in Saudi Arabia,” A&O said in a statement. “In order to increase our capacity to meet this demand we have taken the decision to work with a broader range of law firms in the Kingdom.”

K&A managing partner Zeyad Khoshaim added: “This joint decision serves each firm’s strategic interests. For K&A, it allows us to be independent and work with other firms, including US-based firms. This opens up opportunities to work on a wider set of matters and service clients from the US, amongst other jurisdictions with strong ties to Saudi Arabia.”

K&A, which is based in Riyadh, has four partners, three counsel and around 35 lawyers. It is highly rated in the Chambers and Partners directory with Khoshaim ranked as a Band 1 individual.

Khoshaim – who originally joined A&O as a partner in 2010 – said the practice had grown into a full-service firm, expanding its partnership and opening an office in Jeddah.

He added that the multi-billion-dollar Vision 2030 strategy to diversify Saudi Arabia’s economy away from oil had generated a lot of interest from US companies . This, he said, “put the firm in a good position to advise US-based companies like AMC and Johns Hopkins University on their investments, and collaborate with other firms with specialised expertise on mega deals like Saudi Aramco’s acquisition of SABIC, Saudi Aramco’s IPO, and the SAMBA/NCB merger”.

For its part, A&O, which has regional offices in Dubai and Abu Dhabi, underlined its Middle East credentials.

“As one of the law firms with the longest established presences in the Middle East,” it said, “we remain committed to the region and we believe this decision will best serve our clients in Saudi Arabia and around the world in the longer term.”

In August, the two firms cooperated on two major deals for Saudi Electricity Company; a $2.4bn syndicated murabaha facility agreement provided by a syndicate of Saudi banks and and a %1.3bn dual-tranche green sukuk. A&O’s Dubai team advised on the first deal with a London team spearheading work on the latter.

In March A&O ended its longstanding alliance with its Romanian ally in a move that saw six-partner Radu Taracila Padurari Retevoescu (RTPR) relaunch as a standalone practice.

However, in January the magic circle UK firm become the latest international practice to forge a formal alliance with a local practice in Shanghai.