Hammonds' primary strengths lie in mid-market and AIM corporate
work, property, employment, energy and dispute resolution.
The firm, which is nearing its 150th birthday, has had something of
a roller-coaster ride over the last decade. Rapid expansion
in the 1990s led to plummeting profits, followed by an exodus of
talent. Profits in the 21st century have vacillated wildly,
with earnings bouncing from profit to loss and back again.
However, Managing Partner Peter Crossley pointed out at the start
of 2009 that the firm's litigation team has performed well,
bringing in 21 per cent of revenue, and that significant corporate
work was in the pipeline.
A world's eye view
Founded in Bradford in 1864 by Albert Victor Hammond, the firm's
climb into the limelight kicked off in 1988 when it merged with
local firm Last Suddards to form Hammond Suddards. Both firms
had offices in Leeds, which were merged and later became the firm's
headquarters. The new firm focused its efforts on commercial
law and made a name for itself in the Yorkshire legal market.
Throughout the 1980s and 1990s, it capitalised on the increase in
M&A activity which followed the large number of private
businesses going public and advised on a number of high-profile
deals. On the back of this success, Hammond Suddards
considered the time ripe for expansion: in 1990, the firm opened an
office in Brussels, followed by a London office in 1991 and one in
Manchester in 1993.
A further merger in 2000, this time with Edge Ellison, saw the
creation of Hammond Suddards Edge, at the time the seventh-largest
commercial law firm in the UK. The firm began to expand
internationally in earnest, opening offices in Berlin and Munich in
2001, merging with the Paris-based Hausmann & Association, and
opening an office in Hong Kong. A relationship with Italian
firm Rossotto e Association formed in 2002 added links to offices
in Turin, Milan, Rome and Aosta, while a Madrid office was acquired
Lock-ins and lease-outs
Unfortunately, the drop off in corporate work that followed the
dot-com bust in 2001 left the firm financially overstretched.
Its over draught grew to £30 million, profits fell and a huge
partner defection followed, with 42 partners jumping ship in
2002-2003 alone. In 2005, the firm instituted a partner
lock-in. By 2006, profits had risen again, and the firm
seemed to be on a surer footing. In March 2009, after a High
Court ruling in the firm's favor, Hammonds settled litigation with
seven of eight former partners who disputed their obligation to
repay £1.7 million in overdrawn profits. But at the end of
that month, four more partners, including the head of the London
pensions practice, left the firm.
In addition, the firm is now embroiled in a dispute relating to
the collapse of its spin-off volume conveying business, Hammonds
Direct. Hammonds Direct, which occupied a building leased by
Hammonds, went into administration in January 2009. The firm
and its spin-off now contest liability over the lease. The
complication is that 20 of Hammonds Direct's 41 shareholders are
also partners at Hammonds, so that if the firm takes legal action
against Hammonds Direct, 20 of the firm's partners would, in
effect, be suing themselves.
Keeping up corporate
Hammonds' key strength in corporate matters saw it carry out a
number of deals in the last year. In December 2008, a
Manchester team acted for ECI Partners on its £33.3 million
public-to-private takeover of IT company Ascribe. Also in
December, the firm advised vocational training business Melorio on
the reverse takeover of Zenos for £33 million. Consumer
electronics brand Alba instructed Hammonds on the £15.25 million
sale of its Alba and Bush trade marks to Argos Limited at the end
of 2008, and also received advice on a capital reorganization.
In March 2009, Hammonds counseled new client Secure Trust Bank on
the £16.7 million acquisition of a loan portfolio from Liverpool
Victoria Banking Services Limited, and advised longstanding client
Torotrak plc on a £8.4 million license agreement with the US-based
automotive transmissions giant, Allison Transmissions, Inc.
In June 2009, a Hammonds team helped secure clearance for a
mega-merger between Lucite International and Mitsubishi Rayon
Corporation. Hammonds advised the shareholders of Lucite on
the $1.6 billion agreement, which required merger control clearance
in seven jurisdictions, including Germany, Portugal, Spain, Turkey,
China, Korea and Taiwan.
Having made a name for itself in insolvency work in the 1990s,
Hammonds recently acted for PricewaterhouseCoopers on the
acquisition of Adams Childrenswear by former owner John Shannon,
after the retailer went into administration in December 2008.
In June 2009, the firm advised members of Chesapeake Corporation's
group of companies on a $485 million financial restructuring
deal. Hammonds also advised Lloyds Development Capital on its
£32.5 million buyout of Quantum Specials, a UK-based supplier of
tailor-made medicines to the pharmaceutical industry. A
number of places on bank panels, Hammonds sits on panels for RBS,
Lloyds TSB and National Australia Bank, also position the firm well
to get first dibs on insolvency work.
On the property side, Hammonds advised Spanish supermarket major
Eroski in setting up a joint venture with Topland, a UK property
investor, in November 2008. The agreement involved 12
hypermarkets and provides for Topland to take on part of Eroski's
portfolio of stores in a sale-and-leaseback transaction.
Worth approximately '¬361 million, the deal was the largest-ever
hypermarket sale and leaseback to take place in Spain.
Layoffs are a one-off
At the end of January 2009, the firm concluded a redundancy
program in its UK offices with the layoff of 24 lawyers and 53
support staff, the majority in the corporate and real estate
departments. At the same time, managing partner Peter
Crossley told The Lawyer that the layoffs were a "one-off",
assuring that there would be no further redundancies. Among
other cost-cutting measures, the firm announced that it would cull
20 partners from its UK ranks, require all corporate associates to
take a two-month sabbatical, and offer its September 2009 intake of
trainees the option to defer their training contract for 12 months
and undertake a client secondment for a three-month period based on
an enhanced maintenance payment.
Not all the staff movements have been out-bound. In March
2009, the firm brought in a senior associate from Pinsent Masons to
join the London pensions practice and recruited another lawyer for
its planning team in Birmingham. In addition, three experts
in international trade, shipping and commodities have joined the
firm's London, Leeds and Hong Kong offices since late 2008.