Hogan Lovells. Photo: Diego M. Radzinschi/ALM.

Hogan Lovells is planning to more than double its Australian partner numbers in the next three years, on the back of more work from global clients, winning work from Australian companies, and a pickup in local infrastructure building.

The firm is one of the more recent foreign entrants into the Australian market, having established in Sydney and Perth in 2015 with two launch partners, husband-and-wife team Tim and Nicky Lester. But the firm's managing partner in Sydney, Scott Harris, said it was only with the poaching of four partners in early 2016 that the Australian arm of the firm became fully operational.

"We're still young, still fairly embryonic, but we've been setting our footprint down and getting on with some pretty good work," Harris said.

Scott Harris

Harris took over as Australian managing partner in January 2018. The Lesters left the firm in March of this year to launch their own multidisciplinary advisory firm.

"They did a great job getting us up and running," he said.

Hogan Lovells is now planning to expand in Australia in the next three years, hoping to have about 15 partners and a total of 50 or 60 fee-earners.

Currently, it has six partners and Harris described its growth to date as a "targeted approach". "The low-hanging fruit," he said, is made up of existing global clients of the firm that are doing business in and out of Australia. But the firm is also winning work from local clients that are doing business outside of Australia.

"We are getting very, very good work. It's profitable work. And it's certainly been sufficient to justify the investment and encourage the next stage of investment in the firm as we build out towards that roughly 15-partner mark," he said.

Hogan Lovells in Australia focuses on a handful of significant industries – energy, natural resources, financial institutions, projects and infrastructure.

In particular, said Harris: "We would also look to maybe building out further areas, such as projects and infrastructure, given what is anticipated to be a continual growth in that area."

He pointed to a continued pickup in spending on projects by the national and state governments and on energy and natural resources in Western Australia. This is why the firm set up in Perth and Sydney, bypassing the other major commercial centre – Melbourne.

The firm is split into a corporate group, which works on private and public M&A, equity capital markets and private equity; and a finance group, which works on leverage and structured finance, project finance, restructuring and insolvency, and regulatory.

"The opportunities we see are the international clients of ours that do business in and out of Australia. The fact that we have a strong, very strong, U.S. presence marries up with the significant U.S. investment that comes into Australia," he said, adding that close to 30% of all foreign investment to Australia comes from the U.S.

"We have obviously been servicing existing international clients, we've procured top-quality work from domestic clients in Australia and we've built up quite an impressive deal sheet as far as the sophisticated, complex work that we've undertaken, which is exactly what we set out to achieve," Harris said.

"So that's been incredibly reassuring for us and quite exciting as we move forward. You know, obviously, we want more of it and will build upon that."

Significant deals include advising U.S. tech giant Oracle on its A$1.6 billion (US$1.1 billion) acquisition of Australian cloud-based solutions company Aconex; advising Swissport on acquiring Aerocare, the number one ground-handling operator in Australia and New Zealand for an undisclosed amount; and representing represented Sydney-based medical device product developer Elastagen on its acquisition by Allergan, a leading global biopharmaceutical company.

Other deals include acting for Bank of New York Mellon in the refinancing of Reliance Rail – a public-private partnership to build and maintain Sydney's suburban trains – and representing Barings in the first-ever Australian unitranche financing.

"It's a bit of a mix in there as far as whether they've been existing global clients to the firm, or they've been domestic clients of the firm, or clients that may have followed the partners," Harris said.

Harris described Australia as a "significantly competitive market" for legal services.

"It's competitive, winning work that you can undertake within a relatively profitable way. Where there's the influx of global firms coming into Australia with various different models, there's also domestic firms to compete against," he said. "So that's probably the main challenge for not just us, but for every firm."

Hogan Lovells strives to stand out in the competitive field by focusing on its core areas of expertise – it is not a full-service firm in Australia – and emphasising its global platform.

"It's a fully integrated platform, so partners in Baltimore, New York, London, Munich, Ho Chi Minh City, etc, are all my partners. We're not franchised in any way, we're not sliced and diced, we work together to a common profit pool," he said. "The differentiator for us is that enables us to execute on work as one partnership effectively."