Despite a strong performance, the firm's City base was hit by six partner exits in 2013. Alex Newman reports

When Weil Gotshal & Manges last year announced 170 redundancies across its associate and support staff ranks, the market was shocked but viewed it as a difficult but necessary decision. A drop in high-profile restructuring and litigation work had contributed to flat global revenues for 2012 against a nearly 9% fall in profits. 

Executive partner Barry Wolf admitted at the time of announcing the cuts that some partners may decide to leave as a result of "meaningful compensation adjustments for certain partners" due to the changes in the economy, but no numbers were referenced. Since then more than 30 partners – equating to around a tenth of the global partnership – have left. This included at least 17 partners packing up in Houston and Dallas, as well as several senior partners from the firm's east coast bases. Market sentiment suggests at least some of the senior departures represent collateral damage. 

The firm's London office, which had been growing rapidly at partner level in recent years and – in contrast to the US – saw a 22% rise in revenue in 2012, has also been hit by a number of high-profile exits. Of the 31 partners in the office at the beginning of 2013, six – around 20% of the office's senior lawyers – have left. Even for a modestly sized City outpost, this is a significant turnover. 

In London the trickle of exits began in May, when private equity partner Mark Soundy left with City tax head Sarah Priestley and associate Simon Burrows. This was later followed by the departures of litigator Matthew Shankland to Sidley Austin, tax partner Brenda Coleman to Ropes & Gray and funds partner Nick Benson, who joined in 2011 as part of a four-partner team from Clifford Chance but left for Latham & Watkins earlier this month. Finance partner Rob Ferguson meanwhile left last September to pursue a course at London Business School.

Added to this list – according to one Weil partner in London – are "quite a lot of associates" who have left the corporate group over the last 18 months, with the perception remaining that the firm could do more to shed its enduring 'we'll getchya and mangle ya' moniker. 

Some former partners claim associate turnover has exacerbated senior exits by making it more difficult to build consistent deal teams, while other issues cited include an over-emphasis on private equity and corporate work, at the expense of other practice areas. 

One ex-partner, who claims the City office has "never got the balance right", argues strategic moves into fund formation and structured finance work have yielded mixed results, and consequently are still seen as secondary to the stellar private equity buyout practice.

Related to this is the somewhat thorny subject of star partners. "London has hugely over-performed, but there's still a kind of personality that dominates, which makes it hard to join the dots between practices," comments another partner close to the firm. "It's all chiefs and no Indians. Weil sees itself as a number of individuals who work under the same name, not as one firm."

However, for London managing partner and executive committee member Mike Francies – who would not be drawn on the last point – any short-term volatility in partner numbers must be seen in the context of several years of growth.

"Partner and associate moves are becoming more common in the market and we are not immune to that, but the strength of the office has made it relatively easy to recruit new associates," he argues.

"The office has been doing well and was very profitable, but, from 2011, we decided to make a further major investment in London by building on our two market-leading practices: private equity and structured finance. In just over two years, we've achieved a huge amount." 

The office was given a further boost this month with the hire of Hogan Lovells banking partner Chris McLaughlin, the fourth lateral hire in London since 2012. In 2011 nine laterals were brought in. 

And in fairness to Weil, despite continuing speculation about further departures in London, neither rivals nor ex-partners seem to think the revolving door is going to create significant difficulties in the longer term. 

Moreover, assuming that at least some of the departures have been linked to the redundancies announced in the US, the exodus is likely to slow down.

"We obviously announced the big reduction in the workforce and some percentage of the partnership was redefined, and therefore it is not a surprise to see people leaving," contends one Weil partner. "The firm has taken a big decision, but I think we're near the end of it."

A Weil spokesperson in New York declined to comment on the global changes.

London departures in 2013-14

Matthew Shankland, litigation – Sidley Austin
Nick Benson, fund formation – Latham & Watkins
Mark Soundy, private equity – Shearman & Sterling
Sarah Priestley, corporate tax head – Shearman & Sterling
Brenda Coleman, tax – Ropes & Gray
Rob Ferguson, finance – London Business School

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