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PHILADELPHIA � A year after its merger with Richards Butler UK, Reed Smith will officially add the firm’s Chinese affiliate, Richards Butler Hong Kong, effective Jan. 1. Reed Smith will then have a significant presence in Asia, with offices in Hong Kong and Beijing and immediate plans to apply for a license to practice in Shanghai. This is the third combination for Reed Smith in 12 months, with the first Richards Butler deal followed closely by a Chicago merger with Sachnoff & Weaver in March. The Hong Kong group will bring Reed Smith to over 1,500 lawyers across the globe and to revenues in excess of $1 billion. Reed Smith Firmwide Managing Partner Gregory Jordan said he wasn’t sure of the exact revenue the Hong Kong group would immediately add to the firm, but he said it is probably more than $60 million. There are 110 attorneys who spend their time between the Hong Kong and Beijing offices of Richards Butler Hong Kong. Jordan said the firm is the fourth largest in Hong Kong, with the top five having between 100 and 125 attorneys. Richards Butler Hong Kong is known as a strong corporate and commercial firm and is one of the top two or three securities firms in Hong Kong, Jordan said. The firm has assisted in about 200 initial public offerings in the past few years, he said. “Hong Kong is sort of the New York of Asia,” Jordan said. The firm also handles banking, finance and litigation work, he said. When Reed Smith completed its combination with Richards Butler UK in January, the Hong Kong affiliate did not immediately come on board. Jordan had said previously that the two Richards Butler entities split in the 1990s because of England’s tax structure, but they worked in cooperation. Since that time, Jordan said in an interview Friday evening from Hong Kong, Richards Butler Hong Kong has been “fiercely independent.” Jordan said it was the most complex and challenging deal the firm has ever done, but less because of the regulatory issues and more because of the convincing it took to get Richards Butler Hong Kong on board. Putting together this deal took nearly a year as Reed Smith had to convince the firm that a merger would be beneficial, despite the Hong Kong office being very profitable on its own, Jordan said. “Probably 20 of the 50 largest firms have courted these guys over the past year,” he said. The competition with other firms and the Hong Kong group’s desire to stay independent meant a “very long and deliberate process” on Reed Smith’s part, Jordan said. The wait was worth it as far as Jordan is concerned. The addition of Richards Butler Hong Kong will offer Reed Smith a unique platform and give the firm offices across the globe, including its largest office in London, a presence in Dubai and Abu Dhabi, and offices across Europe and the United States. Richards Butler Hong Kong has been in the Chinese market for more than 25 years and has handled some of the first insider dealings inquiries by successfully defending the Hong Kong Stock Exchange. The Beijing office was opened in the early 1990s. London and Pittsburgh-based financial services partner Thomas Todd has recently relocated to Hong Kong to help with the integration process. Hong Kong partners Graham Winter and Will Barber will join Reed Smith’s executive committee. From a structure standpoint, Jordan said Richards Butler Hong Kong is similarly modeled to Reed Smith, with equity and non-equity partners and associates. He said the firm probably has a slightly higher number of associates on a ratio basis than Reed Smith. According to the Richards Butler Hong Kong Web site, there are 28 partners in the Hong Kong office. Philadelphia corporate partner Vince Capone served as Reed Smith’s attorney on the deal. He said from Hong Kong on Friday that the deal took a normal course of time to negotiate. While in Hong Kong, Jordan and the Reed Smith team did more than finish up the deal. They took an opportunity to visit several clients with major operations in China, including Bank of New York Mellon, Merrill Lynch and Eli Lilly and Co., Jordan said. There are also several Richards Butler Hong Kong clients who are based in China but have offices in other Reed Smith markets, he said. Jordan compared Shanghai and Beijing to New York and Washington, D.C., respectively. He said it was important for a firm like Reed Smith with a strong financial services focus to be in Shanghai � a financial center of China. Jordan said he isn’t quite sure how long the process will take to obtain a license to practice in the province. Consultant Peter Zeughauser of the Zeughauser Group said this acquisition “absolutely” puts Reed Smith ahead of its counterparts in Pennsylvania but there are several firms that already have a large presence in China. Baker & McKenzie has about 200 lawyers in China and 800 throughout Asia, he said. “It’s a great start, but I wouldn’t call it a head start,” Zeughauser said of Reed Smith’s entree in the Chinese marketplace. Shanghai is a very important next step, he said, for Reed Smith’s growth in the market. “There’s no question that mainland China today is more important than Hong Kong,” he said.Overall, Zeughauser said, Reed Smith’s acquisition in China is part of “an impressive growth pattern.” While it may have the largest group of attorneys in China, Reed Smith isn’t the first Pennsylvania firm to enter the market. Blank Rome gained a Hong Kong office through its merger with Healy & Baillie in October 2006. There are currently six attorneys in the office, according to the firm’s Web site. K&L Gates acquired offices in Beijing, Honk Kong and Taipei, Taiwan through a merger with Preston Gates & Ellis in January. There are a little more than 50 lawyers between the three offices. Morgan, Lewis & Bockius opened a Beijing office in February 2006 and currently has three attorneys who practice full- or part-time there, according to its Web site. In April 2007, White & Williams formalized its alliance with Chinese-based Xue Law Firm. Gina Passarella is a reporter with The Legal Intelligencer, a Recorder affiliate based in Philadelphia.

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