Greenberg Traurig has confirmed that it plans to take on a six partner team from King & Wood Mallesons (KWM), after dismissing rumours of a takeover of KWM’s EUME business last month.
The hires, which are subject to “final arrangements”, will include private equity fund partners Steven Cowins and Marc Snell, corporate partners Michael Goldberg and David Fitzgerald, real estate transactional partner Matthew Priday and tax partner Clive Jones. All focus on the real estate sector.
A Greenberg Traurig spokesperson said: “Under Paul Maher’s leadership, we have built a first class office in London, with strong M&A, corporate, tax, capital markets and other areas, including real estate.
“This move will add resources in major firmwide strategic areas of real estate, private equity, M&A and tax.”
These hires come after The Lawyer revealed that Greenberg Traurig joined Dentons in talks to potentially take on chunks of the KWM EUME business in a package deal. The negotiations between KWM and Dentons fell through soon after.
On Monday (12 December) KWM told lawyers and staff they will be paid in January but salaries cannot be guaranteed beyond then.
It is understood news about the February wage slip was communicated to lawyers in the event a successful takeover does not take place.
Last week Barclays took out a second debenture over KWM’s assets that is understood to be more “all encompassing” than the debenture it secured over the summer. The extra layer of security came as it became increasingly likely KWM would enter into a pre-pack administration.
KWM admitted it would need to find a buyer for its EUME arm in November as it emerged its £14m China rescue deal had failed. Only one fifth of the remaining 130 EUME partners agreed to the terms of the deal, which included signing 12-month lock-ins.
The cash injection was needed for the firm to pay its rental liabilities, meet its financial obligations to lenders and pay its January tax bill.
KWM first agreed to improve security around its borrowings from Barclays in the summer, signing a debenture with the lender on 27 July.
The debenture created a series of fixed and floating charges over the firm’s assets, including its revenue stream and real estate.
It also stated the bank can appoint an administrator if KWM fails to meet its financial responsibilities.
In July the firm first voted through a recapitalisation plan, with 98 per cent of partners agreeing to commit in excess of £14m to the business. KWM also asked salaried partners to contribute capital for the first time.
The capital call failed following the shock resignations of four big-hitter partners including head of investment funds Michael Halford and former managing partner Rob Day.
A number of partners have followed in their wake, including former EUME head William Boss, who is moving to Addleshaw Goddard, and head of litigation Craig Pollack, who is understood to be moving to Covington & Burling.
Global managing partner Stuart Fuller also stepped down from his role in recent weeks, returning to fee-earning in Australia. The process to find his successor is ongoing and is due to complete before the end of the year.
KWM is being advised on its restructuring plans by AlixPartners and CMS Cameron McKenna partner Rita Lowe.