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Norton Rose Bags Deneys Reitz and Ogilvy Renault

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The big news from London is that Norton Rose is taking over Deneys Reitz, one of South Africa’s largest firms – and African firm of the year in 2006 – and the Canadian firm Ogilvy Renault. The expanded firm will fly under the Norton Rose flag.

The two firms will formally join the Norton Rose Group on 1 June 2011. This will raise the firm’s head count to over 2,500 lawyers spread over 38 offices.

Norton Rose Chief Executive Peter Martyr commented

This is a very exciting move…Canada and South Africa are increasingly influential economies for our clients in the energy and natural resources, infrastructure, technology and financial institutions sectors.

It’s an aggressive and gutsy move given the weakness of sterling and the strength of the Canadian dollar and the Rand.

According to The Lawyer, the arrangements with both firms will mirror last year’s Deacons deal with the Australian firm with all three operating separate profit pools. Which means this is more about a brand than about money.

Here is the Press Release:

Ogilvy Renault and Deneys Reitz to join Norton Rose Group

15 November 2010
Creating a top 10 global legal practice

International legal practice Norton Rose Group today announced that leading Canadian law firm Ogilvy Renault and leading South African law firm Deneys Reitz will join Norton Rose Group on 1 June 2011.

Together the enlarged Group will be a top 10 global legal practice by number of lawyers with more than 2500 lawyers in 38 offices worldwide.

Peter Martyr, Group Chief Executive, Norton Rose Group, commented:
“This is a very exciting move for the Group and constitutes a significant step towards realising the Group’s global ambition of becoming one of the world’s leading providers of legal services, with offices in the world’s principal business and financial centres.”

“Canada and South Africa are increasingly influential economies for our clients in the energy and natural resources, infrastructure, technology and financial institutions sectors. Ogilvy Renault and Deneys Reitz give the Group increased strength and depth of resource and expertise in these sectors. We are seeing a considerable increase in the amount of business flowing between Canada, Africa, Europe, Asia and Australia; the enlarged Group will be ideally positioned to target this business growth and to provide our clients with the highest quality of legal services connecting these regions.”

John Coleman, Managing Partner of Ogilvy Renault, commented:
“As our Canadian clients become increasingly successful on the international stage, we need to be able to support their international growth. Norton Rose Group is a global leader, with a highly compatible business focus and client service ethic. Equally importantly, our firms have a similar culture and values. As soon as the initial discussions were underway it became clear that we shared a common global vision particularly as it relates to emerging markets such as Asia Pacific. We have strong synergies with the Group, including practice areas, industry sectors and geographic expansion. This is a tremendous development for the firm and our clients.”

Rob Otty, Deputy Chairman of Deneys Reitz, commented:
“The combination of our years of experience in Africa and Norton Rose Group’s increasing involvement in African business will provide the Group with a springboard to become the premier legal practice in Africa. The global markets are increasingly interested in Africa, which is one of the world’s most rapidly growing economic regions. As part of Norton Rose Group, we expect to be at the forefront of developing Africa’s business ties with the rest of the world and in particular with Asia Pacific, Europe and the Americas.”

The Managing Partner of Ogilvy Renault, John Coleman, and the Deputy Chairman of Deneys Reitz, Rob Otty, will join the Group’s Executive Committee.

The two new additions to the Group follow the inclusion of Norton Rose Australia on 1 January 2010.

Comments

  1. Jordan Furlong
    November 15th, 2010 at 11:07 am

    Combine this with the McMillan/Lang Michener merger and other rumblings I’m hearing about, and I think the earthquake long forecast for the big-firm market in Canada might finally be upon us.

  2. Simon Chester
    November 15th, 2010 at 5:36 pm

    Interesting fact sheet on Norton Rose site listing the crown jewels of Ogilvy Renault’s client list:

    Abbott, AbitibiBowater, Aeroplan, Aeroports de Montreal, Aeterna Zentaris, AIG Insurance, Archer Daniels Midland, Axa Insurance, Bank of America, N.A., Bank of Montreal, Bank of Nova Scotia, Barclays, Bell Canada, Bombardier, CAE Inc., Caisse centrale Desjardins, Caisse de depot et placement du Quebec, Canadian Blood Services, Canadian Imperial Bank of Commerce, Canadian National Railway, Canada Post, Cascade |Cerberus Capital Management, Cirque du Soleil, Citigroup, Costco, Deloitte, Deutsche Bank, Domtar, Eli Lilly, GlaxoSmithKline, Goldman Sachs Credit Partners, Gouvernement du Quebec, Henkel & Co., Hydro-Quebec, International Finance Corporation, Johnson & Johnson, JP Morgan Chase, KPMG, Laurentian Bank of Canada, Lloyd’s, Loto-Quebec, Magna, Mattel, Merck, Metro, National Bank of Canada, Nexen, Nortel Networks, OMERS, Pfizer, Porter Airlines, Quebecor, Research in Motion, Rio Tinto Alcan, RONA, Royal Bank of Canada, Suncor/Petro Canada, Servier, Shell, SNC-Lavalin, Toronto-Dominion Bank, UAP inc (NAPA), Via Rail Canada, Valeant Pharmaceuticals, Visa Canada, Warner Chilcott

  3. Simon Chester
    November 16th, 2010 at 10:40 am

    The London press report this morning that the merged firm arrangements will be organized under Swiss law as a Verein.

    Norton Rose chief executive Peter Martyr claimed that this represented considerably more than an association or a joint venture.

    “This is the only way you can really do it to get two businesses together with different equity structures, currency issues and different profitabilities. You could wait until there was parity but that wouldn’t allow you to reach your strategic goals. In this deal we’re really nailed together, we behave as one.”

    Martyr added that the new additions to the Norton Rose group would have “common systems, management, name, strategy, resources and one CEO”.

    “The only thing we’re not doing on day one is splitting the pre-existing profit pools”.

    Though the Australian reports that full profit-sharing is a long-term objective.

    The chairman of US firm K&L Gates Peter Kalis has come out crticizing the deal as not much more than an arrangement, when what clients need is full integration.

    The new Norton Rose will adopt the Swiss Verein structure, a legal arrangement used by other mergers, Hogan Lovells, SNR Denton, the just-announced union between Squire, Sanders & Dempsey and Hammonds–as well as by Baker & McKenzie and DLA Piper.

  4. John Gregory
    November 17th, 2010 at 9:56 am

    The panel on the future of transactional and transnational law held at U of Toronto yesterday said that English law (not common law but the law of England) was increasingly being chosen to apply to international business transactions, not just for the biggest deals, as has been the case for a while, but now for mid-size ones as well.

    The lawyers have apparently decided that Swiss law suits them better, even if English law is good enough for their clients…

  5. Simon Chester
    November 17th, 2010 at 7:05 pm

    The answer to the puzzle won’t become clear until a US firm is added to the Norton Rose mix, and other parts of the jigsaw are turned over.

    Until then, let’s add three new helpful pieces of analysis to the post:

    Our own Jordan Furlong’s long analysis at Law21.ca:

    Here is his provocative hypothetical:

    A new legal services company, GlobalLaw Inc., has risen suddenly and dramatically. Based in London, it has taken advantage of the non-lawyer equity provisions of the Legal Services Act to collect massive amounts of capital from investment banks. With this money, GlobalLaw has bought law firms and hired lawyers worldwide, created a huge and sophisticated online service infrastructure, and marketed itself aggressively in multiple jurisdictions. GlobalLaw has now announced plans to buy mid-sized firms in Vancouver, Calgary, Toronto and Montreal simultaneously, and to re-brand and operate them all as GlobalLaw offices. What do you do?

    That scenario stopped being hypothetical yesterday, with the bombshell announcement by UK-based global law firm Norton Rose that it was merging with South Africa’s Deneys Reitz and Canada’s Ogilvy Renault. You can read the details in any number of places, including The American Lawyer, LegalWeek, the WSJ Law Blog, the Financial Post, and The Globe & Mail — a range of international coverage that underlines the fact that this, as Joe Biden might say, is a big freakin’ deal.

    John Flood headlines his piece as Canada is Recolonized by Rapacious Brits

    Finally a solid piece from Motive Legal in June on the benefits of Vereinen has been updated and applied to Norton Rose in the Financial Post.

  6. Simon Chester
    November 20th, 2010 at 2:44 pm

    First we take Manhattan – then we take Brazil.

    Legal Week reports that Brazil and Latin America more generally, as well as Turkey, Qatar and South Korea are next on the list.

    “Ultimately to be global, it will be necessary to have a US capability, so that remains a major strategic target for a future merger. I would expect something to have happened within the next three or so years. This new platform creates some very interesting opportunities for US firms as we are the first serious player into Africa in a meaningful way, combined with a strong Asia-Pacific practice.”

    And AmLaw‘s Letter from London has the following comments on the Canadian deal:

    Still, the choice of Montreal-based Ogilvy instead of one of the more recognized mining and resources firms in Calgary–Stikeman Elliott; Blake Cassels & Graydon; and Osler, Hoskin & Harcourt–has some lawyers in Canada scratching their heads. Vancouver firm Fasken Martineau, another leading force in the sector, would have killed two birds with one stone by providing South Africa capability through its own office in Johannesburg.

    Martyr is unconcerned, saying that the combination of the network’s existing expertise means the issue will be rectified “in three seconds flat.” “It’s not like going into a shop where you can try lots of different items to get exactly what you want,” he explains, although he claims several other Canadian firms had made merger approaches before Norton Rose started negotiations with Ogilvy.

    Martyr also adds that Ogilvy’s mining and resources practice is “actually much more significant than we thought–it’s just that they’re not structured around it.” He points to other mutual benefits in banking, corporate, and disputes. The Canadian firm’s life sciences and pharmaceuticals group will spawn a sixth global sector focus across the Norton Rose network, he says, though Ogilvy doesn’t have an office in Vancouver, a key centre for the industry in Canada.