Bangkok, Thailand. (Frank Vandenbergh/iStock)
Most global law firms with an Asian presence put their biggest bets on offices in Hong Kong, Beijing, Tokyo or Singapore, the region’s major financial and commercial centers. Then there’s Hunton & Williams.
The firm’s Bangkok office, with 30 lawyers, is by far its biggest in Asia. The Richmond-based firm has just two other locations in the region: Beijing, with three lawyers; and Tokyo, where one associate is based. Two partners fly in and out from New York and Richmond.
Hunton & Williams’ Thai-centric strategy comes with some risks. The firm must fight for business against competitors such as Baker & McKenzie and Allen & Overy—with 66 and 32 lawyers, respectively, in Bangkok—that are better known than Hunton for their work in emerging markets. And Thailand’s lack of political stability can be a problem. Last month a military junta took control of Thailand, ostensibly to break a stalemate between the country’s two main political parties that had all but ground business activity to a halt. The impasse “flattened every economic indicator coming out of Thailand,” says Edward Koehler, Hunton & Williams’ longtime Bangkok managing partner.
But Hunton & Williams has hung on in Thailand for almost 20 years, even when the firm was contracting elsewhere in Asia. The decision to leverage opportunities in Bangkok was more happenstance than regional strategy, says New York-based managing partner Walfrido Martinez.
“It evolved into Bangkok being a leading place for us,” Martinez says. “We didn’t decide at first to be there.”
Hunton & Williams’ first Asian headquarters launched in Hong Kong in 1994. Koehler followed U.S. power company clients such as InterGen, which were eyeing new business in Taiwan and Thailand as those countries began to privatize their power industries; InterGen first brought Hunton & Williams onto a power project in Thailand that year. The firm also landed work for Electricity Generating Pcl or EGCO, which was buying assets from its parent, state-run Electricity Generating Authority of Thailand. EGCO continues to be a key client for Hunton & Williams today, with Koehler currently advising the company on multiple power projects in the Philippines, Vietnam and Thailand.
For two years, Koehler served his Thai clients from Hong Kong, flying to Bangkok when necessary, before the firm opened an office in the Thai capital. A year later, the Asian financial crisis hit, but Koehler says the demand for power in Thailand kept his practice going. The energy practice later expanded into other parts of Southeast Asia and prompted the opening of a Singapore office in 2001.
Yet the collapse of Enron Corp. in late 2001 hurt the entire energy sector, Koehler says, and the 2002 outbreak of severe acute respiratory syndrome, or SARS, slowed the Asian economy. Three years later, management decided to close the Singapore and Hong Kong offices during a downturn in the power industry.
“We had none of the fuller practices that help you sustain the longer term practices,” Koehler says. “If you have a singular practice without a set of ancillary practices, you put yourself at risk.”
In Asia, only Hunton & Williams’ Thailand practice remained buoyant. Koehler took the lessons learned in Hong Kong and Singapore and in 2005 recruited a team of 12 corporate lawyers from the Bangkok office of failing New York firm Coudert Brothers, including former Freshfields Bruckhaus Deringer partners Stephen Bennett and Surasak Vajasit. Former White & Case partner Manida Zinmerman joined in 2008, bringing with her a strong banking practice.
Over the past 18 months, the corporate team has served as Thai counsel to a group of domestic and international banks that financed the $6.6 billion all-debt acquisition of discount warehouse chain Siam Makro Pcl. by Thai retailer CP ALL Pcl, as well as to Japanese insurer Meiji Yasuda Life Insurance Co.’s $715 million purchase of 15 percent stake in Thai Life Insurance Plc. And the firm points to continued work for clients such as J.P. Morgan in finance, and Shin Corp. on private equity deals.
Hunton & Williams, however, has felt some pressure as a result of the latest political turmoil. Last month’s military intervention was the 12th successful coup in 82 years—and that’s not counting nine unsuccessful attempts in that time. The most recent upset started last fall, when then-Prime Minister Yingluck Shinawatra introduced legislation that would have granted amnesty to her brother, former Prime Minister Thaksin Shinawatra, who was deposed for alleged corruption during the last coup in 2006. Thaksin was convicted on those charges two years later and fled to Dubai in order to avoid jail time. The amnesty bill was defeated, but seven months of sometimes violent protests followed, and Yingluck herself was ousted on May 7 for alleged abuse of power. The Thai military took control of the government two weeks later.
The firm says that the military coup has helped to stabilize its work flow. “Since the coup we haven’t had the demonstrations, and some of the major infrastructure projects are back on track, so we expect to see an uptick toward the end of the third quarter,” Bangkok partner Stephen Bennett says. He adds that Thai companies are looking to invest outside the country as well, “which is certainly a change in mindset from the way Thai corporates were functioning 10 years ago.”
Still, Hunton & Williams’ lack of a significant presence in other Asian jurisdictions is a handicap. “If it’s a banking deal out of Hong Kong, and [the client] wants someone in Hong Kong, obviously we’re at a disadvantage,” Bennett says. But he points to a referral relationship that the firm has with Freshfields. “That provides us with at least the avenue to put up a team” elsewhere, he says.
Hunton & Williams also has seen a fair amount of turnover in Bangkok in the past year and a half. According to numbers provided by the firm, since January 2013, 17 associates, two counsel and a partner have left the office, while 19 associates and one partner have been brought on board.* Eleven of the departing lawyers went as a group to Rajah & Tann in March, including Vajasit.
Koehler downplays the impact of the group’s loss, saying that the team’s tax and litigation practice “wasn’t moving much.” Bennett ties their departure to the arrival of a partner hired last December to oversee the group, Baker & McKenzie’s Chinawat Assavapokee. “Unfortunately that had a follow-on effect that we didn’t anticipate,” he says.
Rajah & Tann’s Vajasit and Melisa Uremovic, a former Hunton & Williams Bangkok-based counsel, take issue with that account. In a statement, they commented, “There was a lot of interest in our group and our existing strong practice. We decided to choose a firm that we felt had a commitment to the region and to our people, and which presented growth potential for every team member.”
Hunton says the hire of Assavapokee and litigation senior attorney Apichart Phankeasorn, who joined from Herbert Smith Freehills in December, is helping to fill the gaps left by Vajasit’s team.* Hunton & Williams is also considering whether to reopen in either Singapore or Hong Kong—or another Asian location—over the next 12 to 18 months. Martinez says that the firm has engaged consultants to help decide which path to expansion is best.
But Hunton will proceed cautiously. It remains wary of the “build it and they will come” approach in Asia. “We’ve tried it in the past and it has not been very successful,” Martinez says. “Just being present isn’t enough.”
*Correction, 6/25/14: A previous version of this story misstated the number of partners that Hunton & Williams has hired since January 2013. Former Herbert Smith Freehills lawyer Apichart Phankeasorn joined the firm as a senior attorney, which is similar to a senior associate, and not as a partner. Therefore, it was one partner that joined over the past 18 months, not two.