King & Wood Mallesons’ City boss on rebuilding after the UK’s largest-ever law firm collapse
When King & Wood Mallesons’ (KWM) European arm filed for administration on 17 January 2017 it was the culmination of a slow-motion car crash that had kept the UK legal market agog for months.
Less than two years on the new London managing partner of what has been dubbed KWM 2.0 is not keen to talk about what happened.
“You are dwelling on the past too much, you are going to get me in trouble,” Darren Roiser says, laughing.
Roiser would prefer to talk about KWM’s growth plans in London, where the firm has expanded from seven partners to 14 since it was founded from the ashes of the administration in January 2017.
But the elephant in the room is the fate of KWM’s European arm, which collapsed in what was the UK legal sector’s largest-ever failure a little under two years ago.
KWM’s European arm was built around predecessor firm SJ Berwin, which before the financial crisis was flying high on the back of its private equity and funds practices.
When the crisis hit, the firm’s revenue plunged 14 per cent from £215m to £184m, while its profit per equity partner fell 49 per cent from £801,000 to £410,000.
The firm’s management began casting around for a merger and ended up doing a deal with Chinese-Australian firm KWM that meant the firm took on the KWM brand, but remained financially independent.
During the course of 2016 it became clear that all was not well with the legacy SJ Berwin business.
A string of partner exits and repeated failed attempts to get partners to provide further funding for the firm meant that by December it was evident that, short of a white knight riding to its rescue, the firm was destined for administration.
Disputes partner Roiser and six of his partners were asked to stay on and build a London arm for KWM China following the collapse of legacy SJ Berwin.
“We set up the new firm in three weeks over Christmas,” Roiser says, “20 December to 17 January. It usually takes about two years, we had to fast-track Law Society authorisation, bank accounts,” he says.
Roiser says he began the hunt for the firm’s new home on Boxing Day 2016 and was out looking at potential properties in London on 27 December.
“It was empty, the best time to look for London property,” he jokes.
The band of survivors moved into temporary offices in St Paul's in January 2017, before last month taking the 11th floor of the Walkie Talkie on Fenchurch Street as its new City headquarters.
Roiser, who stayed to the bitter end at legacy SJ Berwin and was involved in setting up a hardship fund for staff who had lost their jobs, was one a handful of partners to emerge from the collapse with credit.
The same cannot be said for some of the firm’s former leadership who bailed out during the firm’s death spiral for lucrative jobs elsewhere.
Readers of legal gossip site Roll on Friday voted for three of KWM’s former leaders as the people who had caused the most damage to the legal profession in 2017, with the site, in response, photoshopping their faces onto dancing elves and strippers to front its Christmas appeal for homelessness charity St Mungo's.
Roiser, however, says he holds no bitterness about the way the firm’s collapse played out.
“It was a difficult time. Broadly speaking the lawyers were fine, for some of the non-lawyers it was a very difficult time. Ultimately people moved on, there is certainly no bitterness,” he says.
Roiser says the shared experience of tough times meant that the cadre of partners who started the new firm in London are a tight team.
“If you are forged in the crucible of difficulties you are going to be closer to people,” he says.
Energetic 38-year-old south Londoner Roiser, says launching the new firm has been the most fun he has had in his career.
“How often in life do you get the opportunity to start a new law firm, pretty much from scratch in a city like London? It doesn’t come along that often,” he says.
He says the revived KWM, which he is keen to stress is a totally new firm, is a “challenger brand” in the London legal market.
Roiser says he is trying to create an office that “fosters energy, enthusiasm, growth, innovation and hard work,” with a strategy based on using the firm’s Asian expertise to stand out in a crowded field.
When asked if the experience of legacy SJ Berwin’s collapse had taught him anything about running a business, Roiser reflects and says: “Lawyers should talk more, if you see inappropriate behaviour… you should call it out.”