A three-partner Allen & Overy (A&O) team has moved out of the firm's associated office in Saudi Arabia, pending the outcome of its agreement with local outfit Abdulaziz AlGasim Law Firm.

The team, which according to A&O's website comprises nine lawyers, has left Abdulaziz AlGasim's premises in Riyadh, where A&O has been based in the region.

It is understood that A&O is planning not to renew its five-year deal with the Saudi outfit after it expired in May this year, although the deal has an automatic one-year extension.

Earlier this year A&O held talks over potentially extending the relationship further, with a firm spokesman stating at the time there was "no way the firm is pulling out" of the region.

The firm is now expected to remain in Saudi through either a new association with a local outfit or by launching its own office under the name of local partner and Saudi-qualified lawyer Zeyad Khoshaim. UK firms can only operate in Saudi in association with a local firm.

The association with Abdulaziz AlGasim started in 2007, spearheaded by A&O finance partner Julian Johansen, who joined that year from Dubai Investment Group, where he was general counsel.

Johansen is one of three partners in A&O's local team, alongside corporate finance specialists Khoshaim and Johannes Bruski.

An A&O spokesperson said: "A&O remains committed to Saudi Arabia. At present we are in discussions regarding our association agreement so it would inappropriate for us to comment further until the outcome of those discussions is known."