IFLR 1000
The Guide to the World's Leading Financial Law Firms

Private equity has made a partial comeback in the past 12 months. "I think its been a better market, there's been more debt finance available, people are trying to divest of assets, so we're seeing increasing activity," says one partner.

Deals are being seen again, although not in the number that may have been expected. "Now we have many transactions in the pipeline but the percentage reaching completion is still a bit low," says one partner. "The debt markets have opened up again for the right deal."

IPO exits and divestments have been surprisingly few on the ground "The interesting thing about 2010 is that people that thought they would be lots of IPO exits and lots of investments but in fact there was just one IPO exit and people don't expect to see more secondaries." Part of the reason for this is simple price discrepancy "There are more pre-emptive actions, people are looking to pre-empt bigger prices, but it's still difficult to get deals over the line." There is also a sense that houses are engaging more with their assets and are not willing to divest at the earliest opportunity. "People are realising that they have to make money from improving assets not just holding them."

Practitioners are hopeful of increased activity born out of the end of the life-cycle of certain funds: "I think the fund raising cycle is promoting activity because you've got funds who are having to go out and extend investment periods, they're actually up against the clock in terms of being able to spend cash they've got available under existing funds and also they're looking at going out to fund raise next year and that promotes activity because you actually have to make exits," explains one partner.

In addition to this, there is a sense of greater competition in the funds space, with managers needing to promote themselves hard to secure investment. "I think another thing is that the fund raising, its not just exits, they are looking to do investments where they are already well provided for in a particular sector, to show that they have more strings to their bow," says one partner and another agrees: "Fund raising has been very tricky and a number of partners have come out to try to encourage people into funds by giving discounts."

There has also been a trend for both houses and funds to diversify their portfolios and also, in the case of the largest players, to look outside their traditional hunting grounds. "For people who are looking at doing multi-billion dollar deals, they are now looking at the mid market," says one funds partner. "There's an element of the bigger boys lowering their sights." Another adds: "There is a less narrow focus, a much broader focus. If you look at the most successful private equity houses they are the most diverse."

Some practitioners have also pointed out that there are more opportunities within the sector than there were in the past, as one partner explains: "Five years ago people used to think that private equity relationships were for life because private equity clients were the most loyal clients out there, but as they matured they were not so reliant on the partner relationships." With several firms boosting their private equity capacity in recent years there is clearly a sense that new clients are there for the taking. Another partner points out that this is part of wider shift: "I think the industry has grown up in the last few years, it realises that it is such an important part of the system, they are much better placed to cope with the PR."

The departures last year of David Arnold and Gavin Gordon drew a varied response from the market, but most were in agreement that the department would not suffer too much. "The two guys that went over there were actually quite junior so although the market made a big deal of it, I'm not sure," says one, while another says. "I think Ashurst have probably suffered with Gavin and David's departure, but they are still relatively busy."

The other key shift in the department in recent years was the promotion of former private equity head Charlie Geffen to senior partner, with the market interested to see how active he would remain in terms of pure deal work. However his continued presence within the firm, some suggest, is enough to ensure the department remains a significant force. "Ashurst still has some very good people so I would not over play that [the departure of Arnold and Gordon]," says one peer. "The loyalty Charlie has with clients should not be underestimated."

The team is now led by Bruce Hanton and last year he acted alongside Mark Sperotto advising Blackstone on the sale of a stake in Merlin Entertainments to CVC Capital Partners. This left Blackstone with a 34% stake in the £2.25 billion company.

Simon Beddow and David Carter meanwhile were engaged by Candover on the €1.2 billion sale by subsidiary Candover Partners of Ontex to Goldman Sachs Capital Partners and TPG Capital. This led on from Ashurst's advise on Candover's original takeover of Ontix in 2003.

Apax is another key client for the team and last year Stephen Lloyd acted on its $830 million acquisition of a majority stake in IT security company Sophos. Lloyd also advised new client Nordic Capital on the acquisition of child safety seat manufacturer Britax from funds advised by The Carlyle Group. The firm was appointed in 2010 as Europe wide counsel to Nordic and will hope to win plenty more mandates in this regard.

Cleary Gottlieb Steen & Hamilton has a strong ongoing relationship with private equity house TPG and this brings in a lot of work in the private equity sphere.

One of Cleary's most notable deals last year was its advice to TPG on its £1.3 billion sale of Mey Içki to Diageo. Led by Simon Jay and new partner Sam Bagot, the transaction is the latest in a series completed by the firm for its client. As well as overseeing the companies original purchase in 2006, the Cleary team also acted advised the company in regard to a proposed flotation of the company on the Istanbul Stock Exchange.

In June 2010, Jay both partners were again involved as TPG acquired clothing retailer Republic from Change Capital Partners and also provided advise to the company as it bid for several portfolios of leveraged loans and other assets.

"I think Cliffords still sit comfortably in tier one and I say this because they have quite a range of skills, but they did have a significant loss in fund formation." This view from one rival sums up how Clifford's is seen now in the market. While few doubt the firm's continued dominance in the transactional space, a significant loss of personnel on the funds side has severely curtailed the firm's practice. Partners Ed Gander, Nigel Clark and Nick Benson alongside tax partner Jonathan Kandel all departed the firm in June to join the fledgling practice at Weil Gotshal. The team was followed in July by associates Stephen Fox and David Irvine who also moved to the US firm. Fox is seen as a particular loss as it was perceived that he would be the one to pick up the pieces after the initial departures.

These recent moves come a year after former funds chief Jason Glover left for Simpson Thacher & Bartlett. With Nigel Hatfield now the only funds partner left in London the market will wait to see if the firm can rebuild.

Despite these fairly major setbacks, on the transactional side the firm is still seen as the one to beat. Indeed peers mention that in some ways the department has been a victim of its own success, as one partner explains: "I think they are the European market leader, but they have lost people to management, David Walker is doing a lot of management." Another agrees: "The problem is that they have a lot of good people in private equity and then those people get moved to management." However despite these minor distractions, Walker and other members of the team with management responsibilities remain active in transactions and their experience is a boon for the team.

The ten partner team still led by Walker has been slightly depleted by the retirement of James Baird in April 2011, but the depth of talent at the firm will ensure that the impact is minimal.

One clear highlight saw a team led by Kem Ihenacho and Patrick Sarch advise CVC Capital Partners and Apollo Management on the second largest take private deal of 2010 as they acquired Brit Insurance for £888 million. The deal had involvement from the firm's Luxembourg, Amsterdam, Beijing, Washington and Brussels offices and was confirmed in March 2011.

One new client this year is Montagu Private Equity and in October 2010 head of corporate Simon Tinkler acted for them on the acquisition of the Host Europe Group from Oakley capital for £222 million.

Department head Walker acted alongside Amy Mahon last year on another deal for longstanding client Warburg Pincus. June 2010 saw the company acquire the Poundland Group from Advent International and the shareholders in a secondary buyout. This followed work in February 2010 when a team led by Spencer Baylin advised on Warburg's acquisition of the Survitec Group.

In the medical sector Jonny Myers acted for Cregstar Bidco (a company formed funds from the Permira fund, who acted as the sponsor) on its acquisition of Creganna-Tactx medical, while Spencer Baylin acted for Actis on the $726 million disposal of Paras Pharmaceuticals, which is considered to be the largest ever exit by a PE fund in India.

Linking up with its Italian office, a London team led by Mathew Layton and Joel Ziff acted for Birds Eye Iglo Group and Permira on the acquisition by Boreas Bidco (a subsidiary of Birdseye) of Findus Italia for €805 million.

A final highlight saw the team act for the Carlyle Group on the high-profile acquisition of RAC from Aviva. Walker and Ihenacho acted on the deal and a separate team from the firm also advised the lending banks led by JPMorgan.

Debevoise like many of its US peers has a stronger focus on private equity than on public M&A transactions.

The funds team consists of five partners led by Marwan Al-Turki and Geoffrey Kittredge and has acted on fundraisings in the last year for the likes of Park Square, Deutsche Bank, Doughty Hanson and Prosperity Capital Management.

On the transactional side, James Kiernan and David Innes lead the team. Innes himself is a new recruit from Travers Smith and the London team was also boosted by the relocation of Raman Bet-Mansour from the Paris office.

Highlights last year included acting for the Rockefeller Group International on the acquisition of a majority interest in fund management group Europa Capital, Helios Investment Partners in the acquisition of a controlling stake in Nigerian electronics firm Interswitch and Harbour vest on the acquisition of a stake in Holtzbrinck Ventures' media portfolio.

Complimenting its market leading M&A practice Freshfields has in recent years broken Clifford Chance's dominance of the European private equity scene and is now seen as a contemporary. This fully rounded corporate offering therefore retains its tier one position on the transactional side this year.

In terms of deals, Chris Bown and Piers Prichard Jones acted alongside colleagues from the firm's Paris and Amsterdam offices acting for CVC Capital Partners on the £1 billion acquisition by a group of funds it advises of the vending machine company Autobar Group from a group of funds advised by Charterhouse Capital Partners.

Another significant mandate saw Farah Ispahani advise HSBC Rail UK on its restructuring and subsequent £2.1 billion sale to a consortium made up of 3i Infrastructure, Morgan Stanley Infrastructure Partners and Star Capital Partners.

Herbert Smith's private equity offering now consists of four partners following the hire in February 2010 of James MacArthur from Kirkland & Ellis.

"They are very good at what they do, nice people," says one client. "At the top of their game in terms of structure. With over 15 years of business with firm they are hugely knowledgeable of our business area."

One of the largest transactions worked on by the firm last year saw James Milne advise Silver Lake and Warburg Pincus on their $3.4 billion bid for financial data company the Interactive Data Corporation. German alliance firm Gleiss Lutz also assisted on the deal.

Another highlight saw the firm work for Blackstone on its £480 million acquisition of Chiswick Park, a UK business park and the second of Blackstone's notable British real estate transactions in recent years following the purchase of the Broadgate complex in London.

New partner MacArthur was also kept busy in the real estate sector advising Chelsfield Partners on its acquisition of the Knightsbridge Estate for £580 million and on the formation of a joint venture to acquire Elizabeth House in Waterloo for £1 billion.

Building on its strong links with the likes of Bain Capital and KKR, Kirkland is a well-known force in private equity. Recent years have seen the US firm expand its influence across the Atlantic and it is now considered a major force in the UK market. Having recently bedded in partners David Arnold and Gavin Gordon, the team can now point to a stronger bench and with other recent additions in the banking and high-yield departments the firm is now seen as a more rounded practice. "Kirkland have become a fairly strong force," says one partner and another agrees. "The guys looking to get out of their band would be Kirkland," while a third adds: "Kirkland is knocking on the door of tier two."

"Initially they didn't have a very strong presence in Europe, but that was about ten years ago, they have built it up quite substantially. I do fund structuring with them," says one client, who also recommended their negotiation skills. "I have also been lucky enough to have the joy of being a witness to a Kirkland litigation. The other side just couldn't compete, they made a mess of them."

Matthew Hurlock came in for specific praise from another client: "Very good. He is a good all round lawyer when it comes to private equity. Very commercial which I think can be a real asset. Very knowledgeable in the business area."

Last year the team acted for key client Bain Capital as the sponsor on the sale of Italian software company Teamsystem to HG Capital for €575 million. James Learner and Matthew Hurlock acted alongside Italian qualified Piero Carbone on the deal, which closed in September 2010.

Apax partners is another key client and James Learner was again involved alongside Rory Mullarkey, John Markland, Ian Taplin and William Welke as a Kirkland team acted for it alongside Madison Dearborn Patners and TA Associates in their exit from Wind Telecom in advance of its £14 billion merger with Vimpelcom.

In July 2010 the team advised Sun Capital Partners on the latest of nine transactions that the team has acted on in the last year for Sun. The firm provided advice on the acquisition of the Alcan Packaging Beauty Business from Rio Tinto for an undisclosed fee.

On the funds side, the firm continues to act for the likes of Candover Partners and Terra Firma Capital Markets on a variety of matters. In addition, funds department head Mark Mifsud and Kate Simpson acted for Partners Group on the acquisition of ten portfolios of private fund investments. On the other side Richard Watkins and Kate Downey advised Nomura on the sale of its life science investment portfolio.

Linklaters has been putting a lot of focus on its private equity practice, mainly on the transactional side and it is beginning to bear dividends. "They have a broad investment management practice but their activity in private equity fund formation is lower," says one peer.

Head of department Ian Bagshaw is clearly seen as the firm's driving force: "Ian Bagshaw has been busy but not just on pure private equity he does a lot of restructuring, but they are definitely busier in the market," comments one rival.

Clients have also noticed the firm's expansion: "They have beefed up quite significantly. It used to be focused solely around him (Bagshaw) and Richard Youle, there was a limited number of good associates, Links is a big animal and it takes some time for them to get on with stuff but now they have really beefed up the practice."

Youle was also popular among clients: "He's skilled with legal matters and has a low ego. He's not afraid of calling in external advice if he needs to, it's pretty unbeatable." Another adds: "The quality of service is second to none, he always steps up whether its working through weekends or over Easter, his ability to do that is second to none, his ability to come up with the goods."

However not everyone in the market has yet been convinced with some suggesting that firm still needs to diversify its client base: "They have got high profile partners who love to sound off in the press but they don't have a keystone private equity client." However with mandates this year coming from the likes of The Carlyle Group and Oaktree Capital, clearly the firm is generating forward momentum.

Clients also pointed out that the firm's offering in some of its other European bases could be improved: "They have really good lawyers almost everywhere but I think that it's a slightly different approach from the other offices. They are not as good and hands on and more lax to allow other departments to take a big part of the transaction leading to bigger fees," says one. Another client backs this up: "We have had some issues there in Germany and Sweden where we thought the fees were a bit expensive."

A clear highlight of the firm's work last year saw Bagshaw advise Triton on its €850 million acquisition of Ambea a provider of care services within hospitals and nursing homes in Sweden. The deal, that saw Triton act alongside KKR and Triactor Acquico, was at time of close the largest LBO in the Nordic region since the credit crunch. The deal was completed against the backdrop of a proposed IPO process.

Another deal with Nordic links saw a team led by Richard Youle acting for HgCapital on its sale of software company Visma to a fund managed by KKR. The deal brings the firm full circle as the Linklaters team advised on the initial purchase of Visma by Hg. HG also called in the team to act on the acquisition of Italian software manufacturer TeamSystem by HGFund VI and Titan Luxco 3. This was the largest acquisition by HG to date.

Youle was again involved as the firm acted for Oaktree Capital on its acquisition of distressed marine services company Gulmark Energy. Oaktree's stake was acquired for a nominal value, with $100 million made available to assist the company.

The Carlyle Group also mandated the firm to act on the combined £600 million acquisitions of Integrated Dental Holdings from Bank of America Merrill Lynch and Associated Dental Practices from Palamon Capital Partners.

Macfarlanes is often compared to Slaughter and May (not a bad comparison by any means) both in terms of its structure and its decision not to go down the road of broad international expansion.

There is no doubting the quality of the firm's UK corporate base, but some peers have suggested that in areas like private equity, the firm may soon have to make a decision whether to embrace the international model or instead accept a position focusing largely on domestic matters. "They've taken the decision not to go global, but private equity is becoming more and more global every day," says one rival.

On the funds side, for which the firm is best known, last year the team acted for Azinin capital on its €100 million Azini 2 fund. The team also acted for Haymarket Capital on its fundraising alongside the Australian Future Fund and other investors which created a new lending business backed by Towerbrook. Stephen Sims meanwhile acted for Montagu Private Equity on the €2.5 billion fundraising for its fourth fund.

On the transactional side, partner Ian Martin was busy last year acting alongside Simon Perry for TA Associates on the acquisition of Cath Kidston and Graphite Capital Partners on the £45 million management buy out of Teaching Personnel.

Matthew Blows meanwhile acted for new client JC Flowers on its investment in the Kent Reliance Building Society, which created a new industrial and provident society.

Lead partner Charles Meek also acted for Duke Street Capital on the secondary buy out of Wagamama.

Simpson Thacher continues to make inroads into the UK market particularly on the funds side, where the acquisition last year of partner Jason Glover from Clifford Chance is seen as a major step forward. "They have everything to suggest they are going somewhere with Jason Glover and they have a lot of money but they have not done something yet," says one rival partner.

With a large number of Glover's former Clifford colleagues now plying their trend at Weil Gotshal & Manges, the market will wait to see how the two US firms fare over the next few years.

The firm has already made some headway on the funds side and can already point to successful fundraising activity for the likes of Actis Emerging Markets 4, BC European Capital IX and EQT VI, the latter of which was a former Clifford Chance client.

On the transactional side the firm is also gaining traction. Working for longstanding client Blackstone the team advised it last year alongside N+1 Private Equity on the proposed acquisition of Mivisa Envases, a Spanish tin can producer.

Blackstone also called on the firm when it sold a stake in Merlin Entertainments to CVC Capital Partners. Michael Wolfson led the deal, which saw Blackstone still maintain a substantial stake in the company.

Another major client KKR also kept the firm busy. A team led by Greg Conway acted for it on the acquisition of a majority stake in software developer Visma from HG Capital and also on its acquisition of a 49.9% stake in helicopter operator Grupo Inaer from InvestIndustrial.

In terms of funds work there are few practices in the UK or indeed in Europe that can compete with SJ Berwin. The firm boasts one of the largest and most active teams in the market and few would question the firm's tier one position.

However it has been a tumultuous 12 months. In the latter half of 2010 the firm engaged in protracted and ultimately unsuccessful merger talks with US firm Proskauer Rose in an attempt by both firms to increase their presence outside of their home markets. Though the talks eventually came to nothing, the ramifications continued and in July 2010 Proskauer poached partners Nigel van Zyl and Oliver Rochman from the UK operation. The market will wait to see if the firm brings in replacements or indeed if it seeks another merger partner.

Before departing the firm van Zyl and Rochman advised Gilde Buy Out Partners on the fundraising and closing of Gilde IV with funds of €800 million. Josyane Gold also assisted SL Partners establish its new €700 million fund, which exceeded its original 500 million target.

Gold also acted on a £450 million fund for Phoenix Equity Partners while Duncan Woolard, Mark Hainsworth, Brian O'Neill and Catherine Sear acted on a £220 milion turnaround fund for Endless which closed in July 2011.

The team is not as well-known in transactional matters but can still point to work acting for the likes of Lion Capital and Duke Street.

On the transactional side, head of department Steven Davis acted for Lion on the sale of restaurant chain Wagamama to Duke Street. David also assisted the Lloyds Banking Group on the sale of a portfolio of private equity investments in 43 companies to Coller Capital.

Other highlights include Tim Wright and Ed Harris acting for Duke Street on the acquisition of the Payzone Group, while Martin Bowen, Nadim Zaman, Gareth Amdor and Laura Abrahams acted for Graphite on the £215 million sale of luxury shoe retailer Kurt Geiger to the Jones Group.

Skadden's reputation is built on corporate and though it is seen more as an M&A firm than a private equity powerhouse the firm still maintains a core of good quality clients in the UK.

One such client is Doughty Hanson, who lead partner Allan Murray-Jones advised on three key transactions last year. In one he advised the group on the acquisition of Vue Cinemas and the subsequent provision of new debt facilities by Nomura International. He also advised the company on its disposal of food can maker Impress Coooperative for €1.7 billion. A further deal saw the team act for the company on its acquisition of Equity Trust for €350 million from Candover.

Another highlight saw the team act for Lamda Partners on the acquisition of chemical producer Neochimiki Lavrentiadis from the Carlyle Group.

Slaughter and May is better known for its work on M&A and other corporate work, however the firm does have a small but noteworthy private equity operation which, due to the firm's generalist policy, is run by the same corporate partners who act on the public transactions.

Jeff Twentyman is one of Slaughter and May's most active partners in private equity and last year he advised Resolution on the acquisition of Axa UK's life business for £2.7 billion. The team also worked on the capital markets aspects of the deal, which was classified as a reverse takeover.

"In some areas they are fantastic. They are very good in terms of analytical skills, government relationships. There's no firm more tied into the government," says one client.

3i Infrastructure is another key client and David Wittiman was called in to advise it as a member of a consortium on the acquisition of the Eversholt Rail Group from HSBC Asset Finance.

Wittiman and his team were also picked out by clients: "They committed themselves to being up to speed, they are commended for being proactive about what we're doing without having to lead us. They get to know us not direct us," says one.

Palamon Capital Partners also kept Wittiman busy, firstly by calling in the team to advise on the sale of a 54% stake in Loyalty Partner to American express and then through portfolio company Retail decisions as it sold its Australian businesses to the Wright Express Corporation for €243 million. The firm also enlisted Slaughter and May's help on a transaction that saw the Carlyle Group acquire Integrated Dental Holdings and merge it with Palamon's Associated Dental Practices.

Travers Smith has a noteworthy private equity practice, which receives mandates from notable players such as The Carlyle Group. Phil Sanderson leads the team.

The team's reputation with clients was very high and many pointed out that the firm's focus on this area was paying dividends: "Extremely knowledgeable of the business area, they are the first port of call on private equity because of their dedication to the industry, they understand the importance of fees, driving forward ideas," says one. "They are partners to our business and they invest in the relationship they have with us. They act as partners. First rate firm, strength and depth with consistent level of quality across the team."

The team advised Carlyle last year as it acquired software developer The Foundry from Advent Venture Partners. The Foundry produces visual effects for the film industry.

One of the largest deals and one of the most high profile saw the team acting for the management of Brit Insurance on the proposed £888 million buy out by Apollo and CVC Capital Partners. Again on the sell side the team also acted for Wagamama on its sale by Lion Capital to Duke Street Capital.

Other highlights included acting for Silverfleet Capital on the buy-out of footwear retailer Office from West Coast capital, and advising Arle Capital Partners on the acquisition of Candover Partners from its investment trust, Arle is made of members of Candover's management.

Weil Gotshal, like Kirkland & Ellis is a firm with an extremely strong private equity reputation in the US and has been trying to replicate that success in Europe. The transactional team has had some notable success in recent times. "Weil have had a real purple patch," says one rival. "They have some big clients that are spending money, their practice is a bit segmented, Marco [Compagnoni] and Mark [Francies] do the high profile stuff."

The biggest strides in the last 12 months though have been made in private equity. July 2011 saw the firm pull of quite a coup hiring a team of four partners from Clifford Chance. Ed Gander, Nigel Clark, Nick Benson and tax partner Jonathan Kandel made the shift to establish Weil's London funds team and they were joined the following month by highly regarded senior associates Stephen Fox and David Irvine. Taking so many lawyers from the former market leading practice will no doubt give Weil a good base to build from, however some peers point out that it does not by any means guarantee that the magic circle firm's client base will follow suit. With it only being a year since Jason Glover left CC for Simpson Thacher, some see the two US operations now being in direct competition for clients. "The nearest example is Kirkland and what they did a few years ago, the danger is that Jason Glover is out there as well, so it could prove that he might benefit more than Weil," says one rival.

A key figure on the transactional side is Marco Compagnoni. "He's very commercial," says one client, "he's the most commercial lawyer around. He understands the deal dynamic and he won't let lawyers get hung up on the details. He's a good negotiator, extremely effective in the live arena. He's not particularly detail orientated but he has the team around him to deal with that." Last year Compagnoni advised Advent International and new client Bain Capital on the £2 billion acquisition of RBS Worldpay, which was at the time the largest private equity deal since 2007. Compagnoni also acted for Advent on the acquisition of the people administration group Xafinity from Duke Street Capital.

Another new client is Morgan Stanley Private Equity and a team led by Mark Soundy acted on the acquisition of Zenith Vehicle Contracts Group. This was the sixth transaction undertaken by Morgan Stanley Capital Market V.

HG Capital also kept the firm busy with Compagnoni and Jonathan Wood acting on two acquisitions and a disposal in the Swedish healthcare sector.

The team also advised on a number of disposals including Lion Capital on its sale of the UK and US operations of Kettle Foods, Canter Equity Partners on the sale of Compinet to Thomson Reuters and Environmental Resources Management (ERM) on a management buy out by Charterhouse Capital Partners, which saw the latter acquiring 65% of the shares in ERM for about $950 million.

Finally a team led by Mike Francies and Jacky Kelly acted for sovereign wealth fund Dubai International Capital on the restructuring of its portfolio investment in the Almatis group in light of fluctuating commodity prices.