Pittsburgh Steal

In October last year, Reed Smith managing partner Greg Jordan was sent a Legal Business feature article. The piece concerned Richards Butler managing partner Roger Parker’s desire for his firm to achieve a US merger. The title was ‘Get Parker’.

In the feature, Parker rationalised, as LB has long argued, that in future an elite group of global law firms of the Clifford Chance and Skadden Arps genus, would exist, as would up to 20 other large international outfits. He realised that for his firm to survive and not fade into mid-level obscurity and mediocrity, it would have to be part of this latter group. Jordan liked the article, and what his Richards Butler counterpart had to say. He decided to try and get Parker.

Jordan already had experience of a UK law firm takeover, albeit on a much smaller scale. On the day he took over the reins at Reed Smith, 1 January 2001, his firm acquired a small London and Coventry outfit with a respected corporate and AIM practice, called Warner Cranston. That began the era of an international Reed Smith. The move – a relatively modest acquisition of fewer than 100 UK lawyers – was precipitated by the actions of a key client that had been talismanic for his firm for over a century: the $16bn market cap Mellon Financial Corporation, a world leader in asset management, with nearly $5 trillion under its control. Rarely have the fortunes of one client and one law firm been so closely intertwined and for so long, in this case since each other’s near-simultaneous foundations in Pittsburgh: Mellon in 1869, Reed Smith in 1877.

By 2001, of course, a globalised economy had taken hold. Mellon was acquiring a UK finance house, Newton Investment Management, and would need substantive English law advice. The risk of Reed Smith missing out on the action of such a key growth client – it bills Mellon in excess of $10m each year – was a potential disaster in the making.

Fast-forward four years, and to Warner Cranston’s legacy senior partner, Ian Fagelson. He chatted with Jordan about a potential Richards Butler deal. Jordan, an atypically impulsive and energetic young leader, flew straight into London after the LB article had been digested. It was Fagelson who put in the initial call to Parker, in mid-October 2005. ‘Greg Jordan’s in town,’ he said. ‘Would you like to meet up?’

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