It is an odd quirk of the regional legal scene that individual markets tend to treat the disappearance of a rival as a bad thing, so keen are the locals to validate the market.
Indeed, lawyers working out of Manchester, Bristol and East Anglia often appear to be willing their rivals on, as if the real issue is the region’s ability to stand up against the domination of London, rather than whether they can beat their peers.
So it is in keeping that the decision of Nabarro Nathanson to pull the plug on its seven-partner Reading office has been greeted with an absence of gloating from the firm’s Thames Valley rivals.
The move has generated plenty of surprise, given Nabarros’ stated commitment to building its technology practice and the potential for crossover with the firm’s busy broker-led AIM practice. Maintaining such a regional outpost is certainly not an unusual strategy for advisers seeking growth company clients. Taylor Wessing, Olswang and Wilmer Cutler Pickering Hale and Dorr have offices in Cambridge, Reading and Oxford respectively.
The consensus from these firms is that targeted local operations are still invaluable in gaining access to university spin-offs and quality start-ups.
Nabarros puts the closure down to the shifting profile of the office’s client base, which would have required considerable further investment, essentially taking the branch full-service.
Some will argue that this signals a failure of nerve at the firm as it suggests that what was supposed to be a targeted team focused on quality start-ups was actually being diverted towards acting for more mature companies.
Others question the value of Reading as a technology centre, not least because for such a small market it is arguably over-lawyered.
It also ranks well behind Oxford or Cambridge as a start-up cluster, its reputation in part due to the proximity of major names like Intel and Microsoft — not the kind of clients that you have to be local to advise.
But there remains a suspicion that Nabarros was finding it hard to crack the region’s technology sector — with rivals claiming it had a low profile with the quality venture capitalists, aside from its work for Benchmark Capital, despite the generally high regard for Reading head Tony Bailes. Perhaps there is also a hint of Berwin Leighton Paisner (BLP) syndrome about the closure. This has seen a number of London firms hastily convert to the merits of mid-market generalism, despite the fact that the success of firms like BLP is surely down to dynamism, drive and investment, rather than mid-market generalism in itself.
Nabarros is stressing the office’s closure should not be equated with a retreat from the technology sector and points out that all seven partners, including Bailes, have agreed to move to its London HQ.
Nevertheless, many would argue that the successful Reading office, which generated more than £4m annually in fees, added a dash of much-needed market differential for a firm often characterised as a property-driven outfit with a solid but unspectacular commercial client base.
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Commentary: Nabarros hits the Thames Barrier
Published: 05/05/2005 00:00
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