The Legal Profession This Week: Escalating Salary Wars and Mishcon de Reya's Pre-IPO Moves​

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By Dheepa M​


The Escalating Salary Wars

Linklaters is the first of the Magic Circle firms to bump its Newly Qualified (NQ) salaries to above the £100,000 mark. The firm is now offering to pay its NQs £107,500 with a discretionary bonus.

Freshfields Bruckhaus Deringer was the first firm to confirm a base NQ salary of £100,000 with rivals Clifford Chance and Allen & Overy swiftly following suit. But the Magic Circle have been playing catch-up with NQ salaries at US firms (between £130,000 - £150,000) for several years now. Each firm in the set seems to wait for the other to take the plunge with increasing base pay before making the commitment to do the same. UK firms make the argument that the lower pay range is the trade off necessary for the better working hours they offer. However, with many transactional teams struggling to keep up with workloads from the post pandemic deal boom, the strength of the work life balance argument seems to be waning.

The Magic Circle may also face pressure to raise trainee salaries. US firm Goodwin Procter is now offering first year trainees £52,000 while second year trainees are offered £57,000.

Mishcon's Pre-IPO Moves

Mishcon de Reya (Mishcon) confirmed an expansion into Hong Kong yesterday through an alliance with a local law firm. This is the second big announcement from Mishcon this month. Just last week, the firm confirmed forming a new merged entity with Taylor Vinters. For Mishcon, these business decisions come at an opportunistic time, before the firm’s imminent IPO.

A further expansion into one of Asia’s largest financial hubs comes as commentators project increased disputes and arbitration from investors over COVID-related financial measures (Law.com). The combined entity with Taylor Vinters also aims to bolster Mishcon’s existing innovation offerings offering better long term value to its clients. These moves will likely increase the valuation of the firm as a whole, however it remains to be seen if the string of back to back changes to the firm’s business will pan out well in the long term.

‘Business as usual’ – the notable deals and cases which went ahead this week:

Ashurst and Herbert Smith Freehills are advising on National Express’s £1.75bn potential merger with Stagecoach. According to The Lawyer, Ashurst has a relationship with National Express dating back to 1992 when the firm first advised on the company’s IPO while HSF also has a long standing relationship with Stagecoach.

Skadden Arps Meagher & Flom is advising Netflix on its estimated £500m acquisition of The Roald Dahl Story Company. The acquisition will give Netflix ownership of the streaming and adaptation rights for all of Roald Dahl’s works. Skadden is advising on both the M&A and antitrust aspects of the deal while Taylor Wessing takes the lead for The Roald Dahl Story Company.

Kirkland & Ells have advised Antin Infrastructure Partners on its €4.1 billion initial public offering in Paris. According to the firm it is the largest IPO of 2021. The deal was spurred by the recent infrastructure boom in Paris and will reportedly help Antin grow its investment portfolio further (Law.com)