The firm, which is not a traditional adviser to JC Flowers, is fielding a team including corporate partner Anthony Macaulay and securitisation partner Dina Albagli.
The instruction is a coup for Herbert Smith as the deal could be unprecedented in its complexities, with huge regulatory issues.
Herbert Smith joins a raft of City leaders on the deal, including Clifford Chance, which is advising the Bank of England.
The magic circle firm was instructed by the bank – a regular client of Freshfields Bruckhaus Deringer – in relation to ongoing advice on the emergency funding it provided to Northern Rock last month.
Freshfields is acting as the lead adviser to Northern Rock, with co-head of financial institutions William Lawes and head of structured finance Alan Newton leading the team.
Slaughter and May has also capitalised on the ongoing saga, with the elite law firm instructed on behalf of the Financial Services Authority to advise on options for the embattled lender.
Elsewhere, Bingham McCutchen is set to secure a major role, with the
Ashurst is understood to be advising another potential bidder – US buy-out house Cerberus on its interest in the bank.
If JC Flowers does go ahead and make a formal offer for Northern Rock, New York firm Cleary Gottlieb Steen & Hamilton could also be in line for a role.
Northern Rock became the subject of a ‘run on the bank’ by customers attempting to withdraw their savings earlier this month.
Citi is also reportedly ready to provide in excess of £5bn of financial backing for a takeover of Northern Rock.
