Newly merged firm puts lateral recruitment at heart of plans to boost profitability

Dentons has set out ambitious plans to ramp up profits per equity partner (PEP) across the UK, Middle East and Africa (UKMEA) following the three-way merger that created the firm earlier this year.

The firm, formed this March by the combination of SNR Denton, Salans and Canada's Fraser Milner Casgrain, has laid out a three-year strategy to increase profitability in the UKMEA region, with lateral hires forming a key part of the growth plans.

UKMEA chief executive officer Matthew Jones (pictured) denied that a specific target for PEP had been set; however, several partners told Legal Week that the firm was aiming for UKMEA PEP to reach that of firms such as Norton Rose Fulbright and DLA Piper (£477,000 and £596,000 in 2011-12 respectively), with other sources citing targets as high as £850,000.

Jones said: "We have set out our plans to partners in detail, sharing with them the financial impacts of certain steps or changes. Our plans are ambitious and we have made it clear that their success depends on commitment from everyone. 

"Part of our planned profitability growth will come from lateral partner hires bringing additional capabilities to complement our existing skill base. 

"It is not possible for us to develop in all the areas we have earmarked for strategic growth in the near term without lateral growth."

Legacy SNR Denton last year reported EMEA PEP of £350,000, but this year declined to provide a regional breakdown, reporting a firmwide figure of £452,000. In 2010-11, legacy SNR Denton's EMEA PEP stood at £232,000, which at the time was the lowest among the UK top 50.

Several UK-based partners spoke candidly of how low PEP figures in recent years have hindered efforts to attract and retain talent. 

Recent hires for the firm's London office include Eversheds banking and finance partner Byron Nurse and SJ Berwin private equity partner Nicholas Plant.

"Profitability is the big focus," said one UK partner. "There's a 100% buy-in to the strategy from the partnership. Bringing in the right laterals is something we're working very hard at." 

"There are plans in place to boost our profits – we cannot allow ourselves to lag behind our competitors," said another. "I'm not suggesting we aim for investment banker levels of remuneration, but we need to be on a competitive footing."