Sullivan & Cromwell has launched a Hong Kong law practice with recruits from Freshfields Bruckhaus Deringer, writes The Asian Lawyer.

Kay Ian Ng, formerly Hong Kong managing partner for Freshfields, will lead the new group for Sullivan, with counsel Gwen Wong is also coming aboard. Both focus on capital markets work.

Ng has advised on many of Freshfields' largest recent deals in the region, most recently leading the firm's work on a $6bn (£3.7bn) Hong Kong initial public offering for China Everbright Bank planned for next month.

Sullivan is the latest leading Wall Street firm to move into Hong Kong with leading partners recruited from magic circle firms. In April, Simpson Thacher & Bartlett launched a Hong Kong practice in April with former Freshfields China corporate head Christopher Wong and former Linklaters Beijing managing partner Celia Lam.

Before that, Davis Polk recruited former Freshfields Beijing managing partner Antony Dapiran and former Linklaters Beijing managing partner Paul Chow.

Milbank Tweed Hadley & McCloy, Cleary Gottlieb Steen & Hamilton and Shearman & Sterling are other elite New York firms that have moved into Hong Kong practice in the past 18 months.

These firms had previously only practised US law in Hong Kong. This had been lucrative – many Chinese companies list on US exchanges and most global offerings in Hong Kong conform to US securities law. But many leading US law firms feared losing out in the long run to 'one-stop shops' offering both Hong Kong and US law capability, and each firm's move has put more pressure on its traditional Manhattan rivals.

The run of predatory recruitment is expected by some to settle down now. Davis Polk's Dapiran notes that Sullivan was until now widely seen as the last elite Wall Street firm yet to launch a Hong Kong law practice.

"Now that they have picked their best team, the game has officially begun," he said.

However, not everyone is eyeing the competition to come with such relish. Noting the exodus of talent from magic circle firms, Dapiran said "a major shift" in the jurisdiction's legal market is underway. In his view the magic circle firms' accustomed dominance in Hong Kong, a former British colony, "has been taken away".

Freshfields promoted Ng to the position of Hong Kong managing partner in March last year following the retirement of the previous incumbent, Clive Rough.

Sullivan's Hong Kong branch opened in 1992. The office, led by partner Chun Wei, will employ 16 lawyers with the addition of Ng and Wong.

The Asian Lawyer is a US affiliate title of Legal Week.