Slowdown In Deals Not Necessary, According To Slaughter & May

LAWFUEL – The Lawyer Newswire – The Times reports – The figures are sobering. According to Thomson Financial’s third-quarter survey of global mergers and acquisitions activity, released last week, the summer’s turmoil in the financial markets brought a record year (value of total deals announced worldwide: $3.6 trillion) clattering to a halt. In Europe, the number of deals has dropped 45 per cent. Is the boom over?

Not necessarily, says Nigel Boardman. The talismanic Slaughter and May partner is more correctionist than fatalist. “I think we’ll see credit costing more, which means that deals which are debt-based — private equity -— may not occur,” he says. “I was talking to some investment bankers this morning who had just turned down several [loans] that would probably have been accepted otherwise, because at the moment cash is king and it’s not worth taking the risk.

“So I think we’ll see deal flow slow down. I think we’ll see a bit more restructuring work. But the market remains strong. Industrial output is rising. China, India still remain buoyant. I don’t see it as a long-term collapse. I see it as a correction. Maybe debt has been too cheap.”

Relaxed and tanned after his annual holiday in the south of France, where he owns a home, Boardman has reason to feel upbeat. Despite the current picture of gloom, Slaughter and May has advised on $217 billion worth of deals so far this year, up 168 per cent on the same time in 2006. Earlier this year, Boardman completed the most complex deal, by his own reckoning, of his career, acting for Reuters in its £8 billion merger with Thomson.

In terms of profitability, Slaughter and May has closed the gap on the leading Wall Street firms and continues to embarrass its larger UK rivals, with Boardman and other top partners taking home a reported £2.5 million. His most famous client, Arsenal Football Club, is sitting happily at the top of the English premier league for the first time in years. Boardman was even named the City’s best-dressed lawyer by Esquire magazine.

Today he wears a crisp white shirt, pale yellow tie, no jacket. We’re sitting in Slaughter and May’s ground floor cafeteria, an almost entirely nondescript space except for a jukebox in the corner, a gift from a client. As an interviewee, Boardman is pleasant and polite but less than voluble: he speaks in precise, measured sentences, saying as much as he needs to and nothing more. Tall and bald, his imposing physical stature and calm demeanour are an arresting combination. He simply owns the space around him.