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King & Wood Mallesons notifies court of its ‘intention to appoint administrators’

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Just days after Legal Cheek revealed magic circle trio plans to scoop up KWM trainees

kwm

Stricken international law firm King & Wood Mallesons (KWM) has confirmed its “intention to appoint administrators”.

In a statement released in the past hour, KWM revealed that it has “filed a notice” with the relevant court to “protect the firm from its creditors”. This, the firm says, will allow “it to maintain client service as it continues to explore all available options”. Trying to remain upbeat, the spokesperson continued:

The firm’s management team and financial advisers continue to work to ensure the best possible outcome for clients and staff, and this move supports these efforts at a key point for the business. We have no further comment to make at this time but will issue further updates as appropriate.

Things have gone from bad to worse for the once well-respected firm this month. Last week it emerged that Dentons — one of the outfits that had initially expressed an interest in scooping up KWM’s European arm — had stepped away from discussions. With a deal to save the firm looking very unlikely, a number of KWM’s top partners have jumped ship in the past week, with six heading to DLA Piper, a further six to Greenberg Traurig and three to Macfarlanes.

Today’s news comes just days after Legal Cheek revealed that a plethora of City outfits, including magic circle trio Clifford Chance, Allen & Overy and Linklaters, had held advanced discussions about saving KWM’s 50 or so trainees. In addition to this, sources told Legal Cheek that the firm’s future trainees will have their applications fast-tracked and prioritised by these firms.

Legal Cheek understands the firms involved are unable to go public with their proposals until they are officially approached by KWM, which is likely to take place when it enters administration. With notice of KWM’s intention to do so filed today, it shouldn’t be long before plans to can finally be put into action.

34 Comments

Anonymous

Shameful. How can it be right that the partners are so quickly welcomed into other city law firms, despite causing the massive downfall of such a major law firm? They should be ashamed. I am sure they will walk into comfy guarantees and salaries and be welcome with open arms whilst the junior lawyers and support staff they leave behind are left stressed, worried and full of anxiety of the prospects of having to job-hunt in the new year.

(70)(7)

Realist

Welcome to the layer cake, partners fire the tea ladies and NQs but PEP increases. Sad but life. However don’t assume all partners are responsible for this mess, they don’t all agree on these things. Also i’m certain (surely) that those who are behind this mess take a hit on their personal reputations. Small comfort I know but just putting it out there.

(26)(2)

Anonymous

The problems surely arose when partners started leaving a year ago, or further back. The issue is cash flow, right? Partners leave, take clients with them, no new work coming in so no money left to pay the bills. The remaining partners decided it was a sinking ship and didn’t put further cash in to try and save it. Should firms change their partnership agreements to limit the number of equity partners that can leave in a year? Probably a sensible idea as it will stop the domino effect.

(19)(2)

Anonymous

But why was there a mass exodus…?

(2)(0)

Anonymous

SJ Berwin historically always lost partners to US firms who wanted to develop private equity offerings in London and would pay well to do so. It was also a pretty significant merger, not everyone would have been happy with the decision to merge.

(15)(0)

Former associate

It was a totally shit merger of a sinking ship. SJB had this coming for years.

(12)(0)

Anonymous

EXACTLY my thoughts! (Excuse my naivety) but wasn’t it the partners who caused this mess by not bringing in the clients/business/money…. how can they be so easily welcomed and employed by other firms whilst everyone else is left suffering?!

(18)(1)

Adz

This was my thought exactly.

But apparently the only people we should care about our trainees…not the support staff and associates, and everyone else.

KWM was well resourced at partner level with toffee-nosed, self-serving turbokh..ts

(15)(0)

Adz

are**

(0)(0)

Anonymous

The partners are lads.

(3)(19)

KWM trainee

Why are you lying LC? Absolutely no one here at KWM heard ANYTHING about the supposed exclusive ‘rescue’ by any firms, let alone the MC shops you mention.

No plans have been announced so far, all you’re publishing is gossip for cheap clicks. Fucking hacks.

(54)(2)

1PQE

Wholly agreed.

The situation here in the office is surreal: partners are departing pretty much by the hour, no one even bothered removing their name tags off the door of their offices given that the whole office is to fold in January.

The only successful ‘rescues’ from KWM were dozens of partners who jumped ship for cozy, very-well paying jobs in US shops. No idea where did LC get whiff of this supposed offer from the MC but the grunts definitely weren’t told of one so far.

I’ve thankfully been offered a spot from mid-Jan at an international firm in the City and so am now just spending my days surfing the web, playing ping-pong in the top floor entertainment deck and generally trolling for banter. Most folks are going off for the holidays by the end of the week, and I can’t imagine many coming in the new year.

(28)(0)

Anonymous

Hey Alex, care to comment on the above?

(14)(0)

Anonymous

Well said. All this gossip doesn’t help us.

(9)(0)

Alex Aldridge

The KWM HR team has been notified by the firms involved, and all the necessary info for the trainees sent across to them. What we don’t know yet is what has been communicated within KWM. As I said before, our story is watertight and all the trainees will be taken on by magic circle and other top City firms.

(4)(15)

Anonymous

this definitely isn’t true, coming from someone who has a TC with KWM, we would have been told by now if this was the case considering we’ve now all been told the firm is going into administration. legal cheek isn’t helping our situation by publishing these stories, knowing the reaction that it will get

(13)(0)

KWM Associate

Horseshit dear Alex. I’m in almost daily contact with KWM’s HR and there are no indications what will happen with trainees, not to mention the future trainees.

Watertight story, lol.

(11)(0)

Anonymous

This is all bull*, the partners the real wolves who raped every penny from firm and walked away leaving the mess. It’s the staff left who will be looking new jobs in the New Year!

This should be investigated for money laundering and other activities which allowed the partners to get away with this kind of crime!!

(18)(2)

Anonymous

Lol you know what money laundering is, right?

(2)(12)

Anonymous

Thieves I say..

(15)(0)

Biq diq

It’s horrendous what the partners have done, but if we were in the same position, we would all have done the same. There is no incentive for a partner to uphold his/her role in the firm, when all the others are leaving!

(9)(3)

Anonymous

I know very little about SJB/KWM. It seems to me that their biggest problem was the merger and subsequent loss of the SJB brand. Losing a reputable brand in the context of an increasingly competitive City market looks (admittedly with the benefit of hindsight) to have been a terrible move.

Imagine yourself as an equity (or salaried, for that matter) partner at the firm. Post-merger you’ve had a new brand and many international cousins foisted upon you which you may not have agreed with in the first place. If a US/other City law firm comes along offering you considerably more wonga to jump, then why would you kiss the shirt and stay faithfully??

(5)(2)

Anonymous

Hell no, I’d jump in an instant. It’s just a shame that there’s always some putz left behind to pick up the tab and deal with the mess.

Facing unemployment a few weeks into the new year must feel so fucking dire.

(5)(0)

Anonymous

Let face it these bastard greedy partners f u c k ed everyone over, now all long serving loyal staff are not getting a penny, partners sucked the firm dry.

(21)(0)

Anonymous

22 yrs of loyal business support service and I’ll leave with poxy statutory. Sad, angry, shocked. It really is a strange atmosphere at QSP.

(22)(0)

Anonymous

That’s ridiculous. Have you reached out / heard back regarding any available positions?

(2)(0)

BRSM

These partners should be shamed of the damage they have caused, how many lives they have affected, pure selflishness!!!

20 years and getting nothing!,

(10)(0)

Anonymous

I believe this summarises the greediness that existed at partner level within KWM and the lack of responsibility taken by key members of the firm for what has happened:

September 5th 2016 – Stephen Kon announces that he shall be stepping down from his role as senior partner for KWM EUME and shall be taking up a role at partnership level.

Early December 2016 – Stephen Kon announces his retirement and leaves KWM.

December 21st 2016 – Stephen Kon joins Macfarlanes Competition Team.

Kon by name; Kon by nature. I myself did a vacation scheme at KWM in 2015, only to be rejected at the final stage. One year on, I have accepted a training contract at an American law firm and count myself lucky everyday that I got rejected by KWM. I wish the best of luck to all those future trainees who must be stuck in limbo right now; no one should have to go through this after working so hard to gain a TC.

To the KWM partner who interviewed me and believed I was not worthy to train at your firm I say …. thank you.

The fact that Stephen Kon, the previous senior partner of KWM announced his retirement earlier this year,

(18)(0)

Anonymous

This is so spot on, I couldn’t have said it better. What a shyte shop.

(2)(0)

Anonymous

Notice of redundancy received 3 days before Xmas nice touch partners of KWM hope you sleep well

(8)(0)

Ramooky

Andrew Leathertodge ran to Court hoping to see what he can pick from KWM.

DWF Mallesons is going to be “the place to be” honest.

(0)(1)

L

I was made “redundant” by SJB 12 years ago. Their reason was because out of everyone I would get another job straight away so it would affect me the least. I had a new job offer within a week I’m readiness for when my garden leave ended. But then they refused to confirm I was made redundant because they were worried what everyone else in the legal industry would think. So I had to fight them for it as I would’ve been unemployable. They tried all the dirty tricks but I won in the end. The way they treated us then was absolutely disgusting. I have many stories. My point is that they’ve always been sneaky & never gave a toss about the minions. When I was there they were always penny-pinching from the support staff so they could pay themselves hefty bonuses. They’ve always been the same. I still have friends who work there. My heart goes out to each & every one of them.

(2)(1)

Anonymous

My role was made redundant at SJ Berwin in 2009. In my opinion, the ship started to sink after the number one Real Estate partner who made the firm millions left and presumably took his client list with him. ..

(1)(0)

C

I was made redundant after 32 years in support staff,I think trouble started when the partners voted Europe or USA,it’s not the lower levels of staffs fault.many have been there a while.communication from above was the problem.

(0)(0)

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