Attention on Deacons as Norton Rose eyes Eastern promise
Will Deacons practice deliver on Norton Rose's grand ambitions for Asia region?
July 08, 2009 at 05:50 AM
3 minute read
Can Norton Rose's tie-up with Deacons deliver the goods in Asia? Norton Rose argues pretty convincingly that the union delivers a low-risk means of substantially bolstering its practice in the wider Asia-Pacific region. With Deacons approaching Norton Rose initially last year, the thinking behind the deal for the UK firm is described as a no-brainer, supplying critical mass in the region with 700-odd lawyers across the combined group.
The merger will also bring together two significant practice areas for both firms: while Deacons brings its strong commodities business to the table, Norton Rose brings its large financial institutions practice as well as robust representation in energy and infrastructure.
A further calculation by the UK firm was that securing an early deal would give the firm competitive advantage, as it would be far harder once other foreign firms start to hunt for Australian tie-ups.
Both firms expect to integrate all facets of the business and operate under the Norton Rose Group brand, with the exception of profits, which will operate separately. Integrating the practices will mean Deacons adopting Norton Rose's five 'headlights' – its core sector groupings: corporate finance; financial institutions; transport; energy and infrastructure; and technology.
The move into the Australian market, however, has been questioned by London and Hong Kong partners alike, especially after news that Deacons was to withdraw from its 17-year-long joint venture with its Hong Kong arm and the two would go separate ways.
Although Norton Rose strongly denies it, some rivals have claimed that the firm was interested in Deacons' well-regarded Hong Kong arm long before Deacons Australia had come into the picture. The firm says that it never entertained the idea of a merger with Deacons Hong Kong, for the sole reason that the firm already has a presence on the ground in China and Hong Kong.
Had Norton Rose merged with Deacons Ho ng Kong, which is best known for funds work, the firm would have acquired strong ties to some of China's largest banks. Deacons Hong Kong is one of the few remaining major independent firms in Hong Kong and currently boasts a seven-strong network of offices.
Norton Rose maintains that the Australian move will significantly bolster the firm's relationship with both Australian and Chinese banks, including Australia Bank, ANZ and one of the UK firm's largest clients, HSBC. Deacons is also known to have acted for a very respectable group of internationally-active banks and investment houses, and Norton Rose currently has plans to significantly expand Deacons' financial institutions practice. The firm relocated Paris finance partner Nigel Ward to Beijing last month in a bid to service an increasing demand to build its Chinese banking practice, and former firm chairman Paul Giles moved to Hong Kong from London in May to help with business integration and client development.
There is no doubt that Deacons' commodities practice should complement Norton Rose's energy and infrastructure capabilities, as the two firms act for a similar roster of clients including high-profile Australian investment house Macquarie.
Some suggest that the move into Australia could make Norton Rose an attractive candidate for a potential US tie-in. However, it seems that at present the firm's focus is genuinely elsewhere. As one Norton Rose partner put it: "The Norton Rose sun is setting in the West and rising in the East."
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