Large firms across the world are expanding into far-flung jurisdictions in search of new work.
Squire Sanders announced Monday the formation of an international association with 32-lawyer Salkom LLC in Ukraine, where it has long maintained a presence. The new venture, called Squire Sanders–Salkom International Association, went live on October 1 when Squire Sanders’ four local lawyers—led by managing partner Peter Teluk—began working out of Salkom’s sole office in Kiev. The Am Law 100 firm first opened in Kiev back in 1995 but spun off its local base in 2003, before eventually returning after a five-year hiatus in 2008.
In a phone interview Tuesday, Squire Sanders chairman and CEO James Maiwurm told The Am Law Daily that his firm has been working with Salkom since the late 1990s, making a more formal arrangement between the two firms a logical move. Maiwurm says there will be “appropriate safeguards” to protect client confidentiality as the two firms begin working closer together.
“Since we’ve known each other for so long, culturally this was a good fit,” says Maiwurm, adding that the alliance will for the most part be exclusive, except when conflicts get in the way. He says that Squire Sanders and Salkom will share marketing and resource costs in Ukraine, which is home to other foreign firms like Baker & McKenzie, Chadbourne & Parke, Clifford Chance, CMS Cameron McKenna, Dentons, and DLA Piper.
Like many countries overseas, Ukraine requires foreign lawyers to be licensed in order to practice locally, but Maiwurm notes that Squire Sanders is mostly focused on cross-border work, while Salkom’s client base is split 50-50 between local and foreign clients. As a result, Maiwurm says the two firms will remain independent, but collaborate on matters involving crossover clients in practice areas like corporate, finance, M&A, and international arbitration and disputes.
Maiwurm, who has recently guided the 1,300-lawyer Squire Sanders through a merger with British firm Hammonds and its expansion into Australia, says that the Salkom alliance will complement his firm’s strong presence in Central and Eastern Europe (the firm has offices in Bratislava, Budapest, Moscow, Prague and Warsaw).
But Ukraine, which a recent report by the Office of the U.S. Trade Representative found had the world’s worst track record of IP enforcement, has also slowly slipped back into the sphere of influence of Russia, its former Soviet master. Late last year, a 303-page report issued by Skadden, Arps, Slate, Meagher & Flom concluded that while internal politics hadn’t influenced the high-profile trial of former Ukrainian Prime Minister Yulia Tymoshenko—a previous report by Covington & Burling had found to the contrary—the proceedings were still flawed. (The report commissioned by Ukraine’s Russian-backed president triggered a brawl in parliament.)
Maiwurm says that while Ukraine is closer to Russia than in years past, his firm remains above the political fray—and the Squire Sanders leader couldn’t help but note that the former Soviet republic’s political situation is “not quite as complicated” as the recently resolved impasse that shut down the federal government stateside.
Squire Sanders is structured as a Swiss verein, and Maiwurm remains a strong proponent of separate partner profit pools. According to the most recent Am Law 100 financial data, the firm saw gross revenue rise 4.5 percent, to $774.5 million, in 2012, while profits per partner remained flat at $800,000.
While Squire Sanders broadens its offerings in Ukraine, two other Am Law 100 firms have set up shop in another former Soviet republic, whose sparkling new capital of Astana has lured both architects and attorneys.
White & Case, which already has an office in Kazakhstan’s former capital of Almaty, announced earlier this month the opening of a second office in Astana following the temporary relocation of partner Maxim Telemtayev, according to sibling publication The Asian Lawyer. In September, U.K. publication Legal Week reported that Dentons had also launched its second Kazakh office in Astana by relocating newly promoted partner Birzhan Zharasbayev from Almaty.
Further south, two major Indian firms have agreed to merge in a bid to expand on the subcontinent. The Economic Times of India reported Monday on the merger between Delhi-based Singhania & Partners and Mumbai-based Rajani Associates to become Rajani, Singhania & Partners.
The merger, which will take effect on November 1, will create a 100-lawyer firm (18 of whom are partners) with offices in Bangalore, Delhi, Hyderabad and Mumbai with an eye toward expansion in Ahmedabad and Pune. Indian legal publications Bar & Bench and Legally India have more on the merger. Alas, foreign firms can only look on from afar, as India’s legal market remains closed while its economy struggles.
Lastly, Legal Week reports that British firm Eversheds announced this week the opening of a second office in Iraq in the northern oil boomtown of Erbil, which was likened to a small-scale Dubai in a recent story by The New York Times.
Eversheds made its initial foray into Iraq by picking up an office in Baghdad following its groundbreaking 2011 merger with Middle Eastern law consortium KSLG. Tawfiq Tabbaa, the managing partner of Eversheds’s Iraqi operations, will run the firm’s new outpost in Erbil, a city of roughly 1.3 million people that serves as the capital of Iraq’s autonomous Kurdistan region.
Despite a recent spate of suicide bombings caused by unrest in neighboring Syria, Kurdistan and Erbil have mostly remained free of the violence that has roiled Iraq following the U.S. ouster of longtime leader Saddam Hussein in 2003. Kurdistan remains a key cog in the country’s effort to unite in the post-Hussein era, and the region’s oil wealth remains a source of tension with the central government in Baghdad. (The Kurds have a strong independence movement, and oil giants like BP and ExxonMobil have backed opposite sites in a showdown over oil revenues.)
For its part, Eversheds is focused on other far-flung regions besides the shifting mosaic of the Middle East, unveiling earlier this month a new Africa strategy that includes plans for offices in places like Ghana, Kenya, Morocco and Tunisia, as well as a return to South Africa, where the firm split with its former local arm a year ago this month over client conflicts.
Eversheds, which last month saw Squire Sanders poach corporate partner Daniel Liptrott in Manchester, recently won a lead role advising the Ugandan government in securing a lead investor for a $2.5 billion oil refinery project, the first in the African country.
Of course, not all plans for remote outposts work out.
In reporting last year on the formation of 2,800-lawyer global legal giant Herbert Smith Freehills, The Am Law Daily noted the firm’s plans to open an office in Guinea due to the sub-Saharan African nation’s potential for energy and infrastructure work.
The American Lawyer has also reported on the rising prominence of the African legal market—a Nigerian magazine recently touted the continent’s growing number of billionaires—but in September, Herbert Smith Freehills put on hold its Guinea plans, according to Legal Week.