Author: Legal Week |
15 Dec 2009 | 09:11
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To some a comeback king, to others still a firm with much still to prove, Simmons & Simmons would generally be classed in the band directly below the magic circle, in a group of firms sometimes loosely referred to as the "chasing pack". This is taken to mean firms such as Herbert Smith, Lovells and Norton Rose, which have substantial international practices and a fair number of bluechip clients but are still a considerable distance behind the UK's top tier.
Simmons entered the recession seemingly in good shape, having bounced back from a period of uncertainty around the turn of the century. Revenues in 2007-08 were up 16% to hit £290m, with average partner profits rising by more than £100,000 to reach £647,000. The new PEP figure was an improvement of more than a fifth (22%) on the previous year's mark of £532,000 and put the firm well ahead of the target PEP of £600,000 set by management. In common with most major law firms, times have been much tougher since the recession set in, with profits per equity partner falling nearly 20% in 2008-09 to £520,000, though revenues edged up to £291m. That leaves the 232-partner firm as the 12th largest practice in the UK in revenue terms. There have also been job cuts in 2009, another indication that Simmons has moved further away from its laid-back image. The firm seems to stand at something of a crossroads at present with it remaining unclear whether it will move further from its broad-service commercial practice to move towards the narrower corporate finance focus of larger City advisers.
Simmons was held up by many as the poster boy for the kind of firm that would be unable to adapt to a more competitive legal market in the late 1990s, when the magic circle was pulling ahead of rivals and beginning to expand abroad in earnest. Poor financial performance, troubled international expansion and a string of senior departures buffeted the firm for four years until Simmons managed to stablise the ship around 2003.
A key decision of the time was the move in early 2004 to demote 11 partners from its equity partnership - equivalent to 12% of its London equity partnership - as part of a move to increase profitability. This risky strategy appears to have paid off. Since then the firm has made considerable strides but the jury is still out over whether it can compete effectively at its chosen section of the market.
Simmons in January 2008 reappointed its managing partner Mark Dawkins for a second three-year term.
By the start of 2009 it was clear that Simmons' practice was being affected by the recession in Western markets. The firm responded like many of its peers by launching a round of job cuts, which claimed a total of 91 jobs in the UK. The firm's 2008-09 results also confirmed that Simmons had seen a sharp fall in profitability. Recent initiatives of note have seen Simmons consult on plans to usher in more merit-driven pay for lawyers and offer clients more flexible billing.
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Partly thanks to the influence of former senior partner Janet Gaymer, Simmons is viewed as having one of the more collegiate partnerships around. It also has a reputation for being supportive of its assistants. Its external recruitment has focused on senior associates ahead of partnership in recent years, giving the firm a more youthful feel.
However, there are some indications that Simmons has of late moved to become a more hard-nosed environment than its reputation would suggest. Legal Week Intelligence's 2009 Employee Satisfaction Report found Simmons received slightly below average marks for making staff feel valued. Some assistants also reported that the firm was overly focused on billable hour targets.
A broad practice that has a less transactional feel that some rivals. Accordingly, employment and IP are strong areas. Perhaps the jewel in the crown in recent years has been the firm's finance practice, which has continued to gain in stature across a number of sectors. Hedge fund-related work has become a particular strength, as has its structured products team in general.
Click here to see a list of Simmons' main practice areas.
Fairly broad. The firm has respected outposts in Italy and Hong Kong. It also secured its largest international merger in 2002 with its takeover of Dutch practice Nolst Trenite. Its Spanish arm helped the firm win one of its biggest-ever mandates in 2005 with its role advising Telefonica on its £17.7bn takeover of O2.
Simmons moved to reshape its European practice in early 2009 after announcing plans to shut its 75-lawyer Rotterdam office, the legacy of the Nolst Trenite merger, to consolidate its Dutch practice in Amsterdam. In October it announced plans to close its Moscow office, little more than two years after launching there. It put the move down to the turmoil in the financial markets. Nevertheless, the firm remains ambitious internationally and is expected to keep investing in key foreign markets.
Click here to see a list of the firm's offices.
Major corporate clients include Telefonica, HMV and New Look, with Deutsche and JP Morgan key clients on the banking side. The firm was once associated with public clients and utilities thanks to high-profile work for the Ministry of Defence and Railtrack.
The loss of a major panel place for the MoD in 2006 and effective nationalisation of the latter has seen the firm, with some success, shift its gaze more prominently towards private-sector clients. However, the firm appeared to have rekindled that relationship with the MoD in spring 2008 after advising on the UK's largest-ever defence PFI deal, the £13bn 'Future Strategic Tanker Aircraft project. In November 2009 it was one of four firms to be appointed to advise the UK Government on the winding down of its stake in the banks that were recapitalised during the financial crisis.
Leading finance partners include Jeremy Hoyland, Richard Perry, Jonathan Hammond and Tony Smith, while well-known IP lawyers include Kevin Mooney and Rowan Freeland. The firm has a range of respected operators in employment, including Simon Watson and Mark Hewland.
Good. The firm has a strong record for promoting young talent. Likes to recruit at senior associate level with an eye towards making partner. However, this year's partnership round saw just four partner promotions, a sharp drop on previous years.
A decent payer, considering the firm's profitability still lags London's top firms substantially. Starting salaries for newly-qualified lawyers rose to £64,000 in 2008. Trainees start on £36,000.
"The bonus is not shouted about as much as it might be," says one contributor. "It is calculated based on hours and seniority. On hitting 1,700 hours, an NQ gets £11,000. This rises to about £40,000 for a senior associate working well over 2,000 hours."
Click here for more career information on the firm.
The firm was something of a pioneer in championing the issue, notably under former senior partner Janet Gaymer. However, Simmons has surprisingly been a little less vocal on the issue in recent months, just at the point when the issue has risen up many rivals' respective agendas. Billing targets have also risen in recent years to a current target of 1,700 a year.
However, at the start of 2008 it emerged that around 20% of the firm's staff had taken advantage of a plan to 'trade' leave - allowing worker-bees to add up to five days a year to their holiday entitlement (or subtract up to five from it) in exchange for a chunk of their salary. Perhaps not surprisingly, the majority of those joining the scheme opted to swap money for more time out of the office.
Recently it has become clear that Simmons has become more hours-centric, which is probably a reflection of its ambition to bolster its position at the upper reaches of the legal market.
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