Dewey & LeBoeuf has appointed London partner Stephen Horvath to a new role of executive partner amid a top-level shake-up which will see firmwide chairman Steven Davis return to practice.

An internal memo seen by Legal Week confirms that Davis will "move from chairman of the firm to return to the practice of law", relocating to London to oversee the firm's operations outside the US.

The proposed overhaul of the firm's management structure, which needs to be approved by a partnership vote, will see Davis (pictured) become part of a new five-member oversight body – the 'Office of the Chairman' – alongside the practice leaders of the firm's four most profitable practice areas.

These are restructuring chief Martin Bienenstock, corporate head Rich Shutran, litigation head Jeffrey Kessler and public policy and Washington DC head Charles Landgraf.

If approved by the partnership, these five partners will oversee the firm's governance for the rest of this year, at which time a new executive committee will be elected by the partnership. The latter body will subsequently decide on the future composition of the Office of the Chairman.

Meanwhile, according to the memo, Horvath's new role will see him "carry out the day-to-day responsibilities of implementing the directions of the executive committee and the Office of the Chairman". He will relocate to New York to take up the new post, but will split his time between London and the US.

The appointments come in response to a stream of departures across the firm's network and a call from partners for "more direct hands-on management", according to the memo, with the governance changes agreed at an open meeting of the firm's executive committee attended by more than 30 senior partners from around the world.

The new management team, in conjunction with Dewey's existing executive committee, will now begin a restructuring the firm around its core areas of corporate, restructuring, litigation and public policy. Insurance will no longer form part of Dewey's core strategy following the recent twelve-partner walkout which saw the firm's core insurance sector transactional team join Willkie Farr & Gallagher.

The internal memo to partners states: "This governance change is being proposed to demonstrate the support and commitment of the practice leaders of among the firm's largest and most profitable business areas and to respond to the requests made by a number of you that you would like more direct hands-on management of the firm by its key practice leaders."

It continues: "We have also heard your requests for more direct communication with partners on internal matters, including compensation and, if approved, the committee intends to respond to that request."

The news comes after the firm brought forward negotiations with its bankers regarding its loan agreements in part due to the increasing number of partner departures both in the US and the UK.

The firm has lost 37 partners so far in 2012 after missing certain financial targets and cutting compensation for a number of partners. It is conceded that the stream of departures has taken the firm closer to breaching its loan covenants.

A Dewey spokesperson, who termed the discussions as "positive", told Legal Week: "We are in the process of renewing our revolving credit facility with our banks and discussions are proceeding as expected."