Welcome to our special report, a Who’s Who of hedge fund lawyers.
More a listing than a ranking, we have featured on these pages the firms we know to be active in the hedge fund space. We will be ranking the leading law firms and lawyers at our inaugural Who’s Who of European Hedge Fund Lawyers awards dinner on 15th November 2006 at The Dorchester, Park Lane, London.
The spectacular change in the London legal scene allied to the hedge fund world over the last five years demonstrates how important this area is to business and to law firms. Back in the 1990s, only Simmons & Simmons and Dechert were recognised as firms with true hedge fund specialisation. Now the market includes a broad array of large global institutional law firms, as well as those firms with a strong emphasis on financial services. In 2005, a string of headline mergers and takeover attempts were heavily influenced and underpinned by hedge funds. The subtext to this is that many law firms have recognised that hedge funds must play a pivotal role in their ongoing strategy, as private equity has for some years.
Just as US firms have flooded into the City, so we are seeing large globally oriented law firms laying great emphasis on hedge fund matters. Allen & Overy, Clifford Chance and Lovells are to name but a few. Note also the many other law firms that have made a natural evolutionary step into the hedge fund space. Berwin Leighton Paisner is a salient example. Having run a vibrant real estate funds practice for many years, it shifted into hedge funds through the lateral hires of Timothy Spangler and Simon Firth in the last few years. “In real estate, although the underlying assets are different [from hedge funds], the legal infrastructure is surprisingly similar,” Spangler comments.
Demands on legal services have encouraged the migration of hedge fund specialisation into the core of law firm strategy. Hedge fund legal services are no longer the absolute preserve of the boutique law firm.
In London alone, the last few months have proved that the legal landscape has been transformed. Simmons & Simmons, a full service law firm with offices in Europe and Asia and the longstanding dominant firm in London, is not only concerned with hedge fund formation; it advised Centaurus Alpha Master Fund Limited as part of a consortium providing equity finance to the bid vehicle Macquarie London Exchange Investment Limited, which launched a takeover offer for the London Stock Exchange earlier this year. Simmons & Simmons employed corporate partners Colin Leaver and Ed Baker to lead this instruction, and showed that the firm was capable of continuing its niche specialisation in the hedge fund arena, but has the requisite skills to also provide counsel to funds operating in the mainstream; namely the mergers and acquisitions market.
On the flip side, we now see that previously unheard of law firms in the hedge fund sector are increasingly influential. With so much of the hedge fund market being run by specialist arms of the institutional investment banks, so have the traditional legal advisers to the institutions risen to prominence. GLG, with its large and sophisticated in-house legal department plumped for Clifford Chance when instructing external counsel. Man Group and Citibank are other examples of influential members of the hedge fund space, that have entrusted an ‘institutional’ Clifford Chance with many of its most complicated mandates.
“Our practice has grown enormously over the last 12 to 18 months,” Clifford Chance’s lead hedge fund partner Matthew Judd comments. “We have seen hedge funds coming into the mainstream and our traditional client base of asset managers and banks are doing a lot of hedge fund work.” Evidently, as hedge fund managers become more institutional in nature, so they are requiring their lawyers to reflect their own dimensions. Simmons & Simmons was chosen to launch eight new funds for Gartmore in 2005; it had previously had little contact with the asset management firm.
“We get involved in almost every aspect of the industry,” Dechert’s Peter Astleford comments. “From litigation, corporate finance, better employee structures, we’re having to do all this and represent hedge fund managers in a variety of jurisdictions.” Dechert’s continuing prominence in this sector suggests that Astleford’s efforts are being rewarded.
Over in New York, those firms launched decades ago specifically to advise the investment funds community have flowered into multi-service outfits. “The traditional hedge fund managers are now pulling law firms into new areas,” explains Michael Tannenbaum of Tannenbaum Helpern Syracuse & Hirschtritt, a firm established in 1978. “We see this as part of a broader practice, interactions between hedge funds and private equity, and real estate,” Bruce Gardner of City law firm SJ Berwin comments. “We are not simply working for Cayman hedge funds, we think the industry has moved on from that, and we think this firm is extremely well positioned.”
It explains why firms like Bingham McCutchen have dramatically expanded its own services to hedge funds. Having specialised in representing the bondholder committees involved in corporate restructuring, it has now elected to offer several more service lines to its hedge fund clients. In the last few months it has brought in a new funds formation team, a regulatory group and a corporate finance department that all have an emphasis on the hedge fund sector.
“The key elements a hedge fund manager is looking for are judgment and creativity, and having the various collateral areas to support the business,” Bingham McCutchen New York partner Robert Leonard says. “The larger funds want all of the collateral services.”
“It’s not just the investments,” Lovells London partner Simon Atiyah comments. “It’s compliance issues, employment issues, remuneration planning issues, which change and develop as the fund managers grow and mature. It’s not just a question of fund formation.”
In the last three years, several firms like Lovells have edged into the hedge fund arena; the large institutional law firm recognises that hedge funds are now part of mainstream business. This changing nature of the sector has altered the structure of the legal services arena that services it. Hedge fund departments are now centrally located within an institutional multi-service operation at law firms. Just taking into account the increasing scrutiny of the SEC and FSA over this sector, suggests that the old traditional hedge funds formation business is outdated and firms like Bingham McCutchen which have invested into the regulatory side have made an intelligent choice. Hedge funds want their legal advisers to reflect their varied and broad interests. ‘Global’ and ‘institutional’ is the name of the game.
More a listing than a ranking, we have featured on these pages the firms we know to be active in the hedge fund space. We will be ranking the leading law firms and lawyers at our inaugural Who’s Who of European Hedge Fund Lawyers awards dinner on 15th November 2006 at The Dorchester, Park Lane, London.
The spectacular change in the London legal scene allied to the hedge fund world over the last five years demonstrates how important this area is to business and to law firms. Back in the 1990s, only Simmons & Simmons and Dechert were recognised as firms with true hedge fund specialisation. Now the market includes a broad array of large global institutional law firms, as well as those firms with a strong emphasis on financial services. In 2005, a string of headline mergers and takeover attempts were heavily influenced and underpinned by hedge funds. The subtext to this is that many law firms have recognised that hedge funds must play a pivotal role in their ongoing strategy, as private equity has for some years.
Just as US firms have flooded into the City, so we are seeing large globally oriented law firms laying great emphasis on hedge fund matters. Allen & Overy, Clifford Chance and Lovells are to name but a few. Note also the many other law firms that have made a natural evolutionary step into the hedge fund space. Berwin Leighton Paisner is a salient example. Having run a vibrant real estate funds practice for many years, it shifted into hedge funds through the lateral hires of Timothy Spangler and Simon Firth in the last few years. “In real estate, although the underlying assets are different [from hedge funds], the legal infrastructure is surprisingly similar,” Spangler comments.
Demands on legal services have encouraged the migration of hedge fund specialisation into the core of law firm strategy. Hedge fund legal services are no longer the absolute preserve of the boutique law firm.
In London alone, the last few months have proved that the legal landscape has been transformed. Simmons & Simmons, a full service law firm with offices in Europe and Asia and the longstanding dominant firm in London, is not only concerned with hedge fund formation; it advised Centaurus Alpha Master Fund Limited as part of a consortium providing equity finance to the bid vehicle Macquarie London Exchange Investment Limited, which launched a takeover offer for the London Stock Exchange earlier this year. Simmons & Simmons employed corporate partners Colin Leaver and Ed Baker to lead this instruction, and showed that the firm was capable of continuing its niche specialisation in the hedge fund arena, but has the requisite skills to also provide counsel to funds operating in the mainstream; namely the mergers and acquisitions market.
On the flip side, we now see that previously unheard of law firms in the hedge fund sector are increasingly influential. With so much of the hedge fund market being run by specialist arms of the institutional investment banks, so have the traditional legal advisers to the institutions risen to prominence. GLG, with its large and sophisticated in-house legal department plumped for Clifford Chance when instructing external counsel. Man Group and Citibank are other examples of influential members of the hedge fund space, that have entrusted an ‘institutional’ Clifford Chance with many of its most complicated mandates.
“Our practice has grown enormously over the last 12 to 18 months,” Clifford Chance’s lead hedge fund partner Matthew Judd comments. “We have seen hedge funds coming into the mainstream and our traditional client base of asset managers and banks are doing a lot of hedge fund work.” Evidently, as hedge fund managers become more institutional in nature, so they are requiring their lawyers to reflect their own dimensions. Simmons & Simmons was chosen to launch eight new funds for Gartmore in 2005; it had previously had little contact with the asset management firm.
“We get involved in almost every aspect of the industry,” Dechert’s Peter Astleford comments. “From litigation, corporate finance, better employee structures, we’re having to do all this and represent hedge fund managers in a variety of jurisdictions.” Dechert’s continuing prominence in this sector suggests that Astleford’s efforts are being rewarded.
Over in New York, those firms launched decades ago specifically to advise the investment funds community have flowered into multi-service outfits. “The traditional hedge fund managers are now pulling law firms into new areas,” explains Michael Tannenbaum of Tannenbaum Helpern Syracuse & Hirschtritt, a firm established in 1978. “We see this as part of a broader practice, interactions between hedge funds and private equity, and real estate,” Bruce Gardner of City law firm SJ Berwin comments. “We are not simply working for Cayman hedge funds, we think the industry has moved on from that, and we think this firm is extremely well positioned.”
It explains why firms like Bingham McCutchen have dramatically expanded its own services to hedge funds. Having specialised in representing the bondholder committees involved in corporate restructuring, it has now elected to offer several more service lines to its hedge fund clients. In the last few months it has brought in a new funds formation team, a regulatory group and a corporate finance department that all have an emphasis on the hedge fund sector.
“The key elements a hedge fund manager is looking for are judgment and creativity, and having the various collateral areas to support the business,” Bingham McCutchen New York partner Robert Leonard says. “The larger funds want all of the collateral services.”
“It’s not just the investments,” Lovells London partner Simon Atiyah comments. “It’s compliance issues, employment issues, remuneration planning issues, which change and develop as the fund managers grow and mature. It’s not just a question of fund formation.”
In the last three years, several firms like Lovells have edged into the hedge fund arena; the large institutional law firm recognises that hedge funds are now part of mainstream business. This changing nature of the sector has altered the structure of the legal services arena that services it. Hedge fund departments are now centrally located within an institutional multi-service operation at law firms. Just taking into account the increasing scrutiny of the SEC and FSA over this sector, suggests that the old traditional hedge funds formation business is outdated and firms like Bingham McCutchen which have invested into the regulatory side have made an intelligent choice. Hedge funds want their legal advisers to reflect their varied and broad interests. ‘Global’ and ‘institutional’ is the name of the game.
