27 October 2016
UK partners at KWM were hauled into a crisis meeting yesterday, at which they were told that the firm now has debts of £35m, an insider claims. At the same time, four top partners jumped ship and the firm put its planned recapitalisation on hold.

That level of debt might not normally be a problem for a major law firm, but KWM has also suffered the loss of 54 partners over the last year. And the four who left yesterday were all big hitters, including former EU Managing Partner Rob Day. The insider told RollOnFriday that CMS and other businesses were at the meeting to offer advice to the partners.

The firm is doing its best to polish the turd. While it confirmed that Michael Halford, Jonathan Pittal and Andrew Wingfield had resigned, and that Rob Day had "indicated his intention to resign", it insisted that the loss of four such senior partners does "not impact on our employees". OK. But given the firm is no longer asking its partners to pay in the millions required for its recapitalisation, that begs the question - what lifeline can the former SJB now turn to?

     

SJB was a City institution and the news of the depth of its troubles is a major shock. It's easy to blame those troubles on the firm's Far Eastern paymasters - but the raft of UK partners who fled to protect their own nests have to bear their share of responsibility too.
 
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Comments

Anonymous 28 Oct 16

Death spiral indeed. Shame to see another entrepreneurial firm collapse. Same story. Smart rainmakers build firm. Businesss grows fast. They bring in institutional people to support. Those plodders take over. Wreck the firm. Smart ones flee early. Useless management sells out to foreign power looking for toehold in U.K. Everyone runs for the exit. Heard that tale before?

Anonymous 28 Oct 16

I would never say "impact on our employees". It sounds wrong. I would say "This does not have an impact on our employees" or "this will not affect our employees". Their words sound American.

Anonymous 28 Oct 16

It isn't a shock to those who know that for many years, and even before any hint of the merger, they have been pretty poor at managing their finances and constantly delaying payment of bills/invoices. It's just finally got to breaking point.

Anonymous 29 Oct 16

Point of fact: SJB was never an "institution", it was in fact the very opposite - a coalition of individual, benignly competing rainmakers. It was famously individualistic. No wonder there has been difficulty integrating it into a global monolith.

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