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

UK based Herbert Smith is noted by the market as having a strong global network. "A slightly more international firm [than Slaughter and May], we often see them with clients from outside the UK," says one peer.

According to one client the firm's "Brussels office is very well coordinated, easy to contact, takes instructions from London well and is always available". Craig Pouncy and Susan Black are complimented by clients, Pouncy for being "very experienced and reasonable in identifying issues" and London-based Black for being "very creative [and] innovative". "She drives a hard bargain but is commercial," adds the client. In 2010 - 2011 Lode Van Den Hende and Kyriakos Fountoukakos also led on high profile deals for the firm.

The firm's scope also encompasses its alliance with German and Dutch firms Gleiss Lutz and Stibbe.

Pouncy acted for Michael 'Monty' Widenius, creator of open source software MySQL, against the merger clearance of Oracle's acquisition of Sun Microsystems. The firm is aiming for either divestment or future behavioural pledges by Oracle in the unfinished case.

Fountoukakos advised Arriva and, topically, BSkyB on the Newscorp bid, which has been notified to the Commission. The acquisition of Arriva by Deutsche Bahn received conditional clearance while BSkyB's sale to Newscorp has also received the green light while the case continues in the UK.

The firm was actively advising a client in a European investigation into car electrical systems. Hende was busy on a wide-ranging consumer protection case before the ECC regarding compensation paid by airlines for passengers for flight cancellations and delays, advising clients including EasyJet and British Airways.

Herbert Smith makes the jump to tier one this year after market opinion overwhelmingly indicated that its growth strategy has definitely paid off, at least in Russia.

"Herbert Smith I have a lot of respect for. A few years ago they said 'we want a bigger share' and they went out and hired Ed Baring and Alex Currie and together they've pushed the firm on," says one rival partner, while another agrees: "Herbert Smith have invested heavily and could be looking up the tiers."

The consensus is far reaching too: "Herbert Smith is definitely pushing its way up. I would expect to see them in tier one," comments a partner, while another competitor hints at their active nature as the reason for its elevation: "Herbert Smith should go up, we have seen them on a lot of deals over the past year."

Clients weigh in with their praise too, keen on the expertise but also the value the firm seemingly provides: "Generally, they are one of the best firms for value, in my opinion. Also, their approach to quotes is commonsensical rather than formalistic."

Another client speaks to the legal capability of the team specifically: "The team has a very high level of technical ability. One of the transactions we did with them involved a relatively complex contracting and security structure."

Even by taking into account this prevailing opinion, the deal flow for the team must stand up and it does not disappoint, with a number of mandates dealing with the oil sector.

One substancial deal for the firm saw a team, led by leading lawyer Edward Baring, advising the mandated lead arrangers BNP Paribas and Standard Chartered on a significant facility to be provided to entities from BP Angola, a facility secured against the cash flow from oil exports. The deal is notable for the difficult surroundings it took place in, against the backdrop of volatility in Angola, the general low ebb of the market and BP's environmental issues in the Gulf of Mexico. The team managed to complete the deal in July 2010 for a figure of $3 billion and Herbert Smith is now also on the panel of firms for BNP Paribas.

Another multi-billion dollar deal saw a team, headed up by partner Artjom Buligin, advising agent WestLB, as well as other assorted syndicate banks including BNP Paribas, Citi, Credit Agricole, RBS, Deutsche Bank and Société Générale, on a dual-tranche facility made creative by the fact that it was unsecured, a rarity in a volatile market. The recipient of this was TNK-BP, a privately-owned oil company, and the transaction went through in October 2010 for a value of $2 billion.

The recent upward trajectory of Herbert Smith's corporate practice seemed to reach its ceiling this year, after a period of sustained growth and visibility finally levelled out. This is not a negative however, as the team retains the respect of its peers in the market and also retains its tier two position. "Herbert Smith has made a lot of progress and has settled down into being a steady firm now," observes one partner. "Herbert Smith is solid in tier two," agrees another.

The firm also shares in another market trend, that of losing important partners. Their loss was Robin Wittering, described as "the team's star" in last year's IFLR1000, who retired to pursue other business interests. "Herbert Smith took a big hit to its practice with Robin Wittering resigning and moving off to the South of France. He's doing other business activities now," comments a partner, though Wittering does remain as a consultant to the Moscow office, so not all his expertise and experience is lost.

The team kept on though, securing some interesting deals over the past 12 months. On one mandate the team received partners Alexei Roudiak and Danila Logofet led the team that advised Yamal Development on its acquisition of a majority 51% participation in Severenergia, an oil and gas concern that owns other companies that possess important development licenses for oil and gas fields in Yamal-Nenets, Russia. Yamal, an evenly split joint venture between Gazprom Neft and Novatek, saw the transaction complete for an approximate value of $1.5 billion in November 2010.

A team led by Oleg Konnov also advised a confidential private investor on the acquisition of a half stake in the National Container Company from FESCO, the number one Russian shipping line. The team also advised on the acquisition finance facility provided by Sberbank in relation to this deal. Representing the largest port transaction in Russia since the Novorossiysk Sea Trade Port IPO in 2007, the deal, worth $900 million, closed in July 2010, settling a dispute between FESCO and First Quantum in the process.

In line with its elevation in the banking rankings the improved visibility and quality of the finance practice at Herbert Smith has impacted in project financing too, as peers overwhelmingly approve of the firm making the jump to tier two and possibly beyond. "Herbert Smith is doing well, they have a strong offering. We seem them more than most other firms. They are definitely one to watch," remarks a competitor. "Herbert Smith should definitely go up. They have been very active and are just much better than the other firms around them," agrees another partner, while a further peer adds: "Herbert Smith has definitely been more visible."

The team is led by finance partner Alexander Currie and he has put his energies into the team's biggest work this year. On this project his team advised Gazprom, and also its joint venture partners as sponsors, and the project company as the borrower with regard to a deal to finance the development of the Yuzhno-Russkoye gas field, located in Siberia. The deal was put in place with the first phase signed off in March 2011, and work continues on a project whose value could exceed €1 billion.

Herbert Smith was also involved in the Pulkovo International Airport project, one of the largest infrastructure deals to reach completion in Russia as well as the first of Russia's airport modernisation plans that has been done on a project finance basis. In this, banking partner Edward Baring advised UniCredit, which was acting as hedge provider. The sum value of the entire project comes to €1.2 billion, and the first part of this hedging closed out in December 2010.