Allens has closed its Hong Kong office following a recent decision to exit parts of Asia in the wake of the firm's alliance with Linklaters.

The Australian big six outfit, which also entered into an energy-focused joint venture (JV) for the region with the magic circle firm in 2012, is scaling back its operations in Hong Kong, China and Singapore to focus on Indonesia, Vietnam and Mongolia.

As part of the move, Allens' Hong Kong partner and JV representative Nic Tole has been relocated back to Perth, while Hong Kong-based corporate partner David Wenger is due to leave the firm at the end of the year.

The Beijing office is also to shut down before 2015, with the one remaining partner on the ground, Kate Axup, preparing to transfer back to Australia, according to sources.

The closures follow an 11-lawyer and four-partner exodus from Allens' Singapore operation since the beginning of 2012, leaving the firm with just one lawyer working in Linklaters' offices. Allens had earlier called time on its Shanghai and Cambodia branches and terminated an alliance in Thailand.

The retreat is seen as a shift away from the firm's original plan for Asia – which was to move its lawyers into Linklaters' China and Singapore offices and to build a joint practice in those regions.

However, Allens said the alliance and the energy JV would continue to operate, and that it was committed to its remaining offices.

"[Asia] is not one homogenous region, but a number of distinct markets with distinct needs," said Allens in a statement. "Our approach is to ensure we're set up to meet the needs of our clients in each place. This means that in some cities Allens has its own presence, while in others we have either co-located or decided that the Linklaters presence is the best course for our clients.

"Our strategy is not based on bricks-and-mortar, but on making sure we are in the right places at the right time and with the right expertise when our clients need us."

It added that in Vietnam the firm had recently appointed a new partner, and in Mongolia it had upgraded the office from a representative base to LLP status. In Indonesia it said it was also growing lawyer headcount.

Allens and Linklaters first announced an alliance in April 2012 as part of a tie-up which also included two JVs: one in Indonesia, in addition to an energy and infrastructure JV in Asia. 

Legal Week reported at the time they hoped to build up a regional team of 30 partners and 60 lawyers for the practice, most of whom would be based on the ground in Asia.

Allens' subsequently relocated its senior energy partner Nic Tole to Hong Kong to oversee the JV alongside Linklaters corporate and banking partners Christopher Kelly, also in Hong Kong, and Christopher Bradley in Singapore.

A source close to the firm said the withdrawal from Asia came amid problems trying to make the energy JV work.

"Allens always said this is not Allens exiting Asia – just co-locating," they said. "Tole was the relationship partner for Rio Tinto – the firm's biggest client. His move was supposed to be a demonstration of Allens' commitment.

"The Allens people were 100 percent focused on energy, but for Linklaters energy was just a small part of what they did. So there was this period of time when we were trying to pursue the joint energy partnership but Allens partners were getting frustrated because nothing was happening.

"Linklaters saw the JV as a geographical play. It was very clear it wasn't working. It was almost embarrassing having three people sat in the corner of their offices not doing anything."

In the last two years Allens has lost five key members of its Asia energy team: Angus jones, who moved to Allen & Overy in Perth; oil and gas head Anthony Patten, who joined Shearman & Sterling in Singapore; Gavin McLaren who exited for Freshfields Bruckhaus Deringer , Darren Murphy who transferred to Jones Day and Marae Ciantar who left for Singaporean outfit Rajah & Tann.

According to the source, the decision to scale back follows a long struggle for Allens in Asia.

"The view within Allens has been that Asia is a problem. They didn't want to invest because it wasn't profitable but they didn't want to close because it would a disaster [for the firm's image].

"So they have existed under the cover of the alliance. It definitely wasn't the plan to exit – Allens wanted it to work – but it has given them the excuse to do that."