Institutional Investor's Alpha Magazine - October 2007 - (Page 50)

Alpha Awards: Top Service Providers LAW FIRMS I n November 2006, when Chicago-based Citadel Investment Group registered the ﬁrst bond offering from a hedge fund, it turned to hometown law ﬁrm Sidley Austin. That same month, when New York–based alternative investments manager Fortress Investment Group ﬁled to go public, once again Sidley Austin was at the table, this time representing the banks underwriting the deal. As hedge funds continue to grow and become more complex, the demands on the law ﬁrms that represent them — both on- and offshore — are becoming more varied. And for a second year in a row, Sidley Austin is the top-ranked onshore law practice among hedge fund managers. The 141-year-old ﬁrm, whose business grew out of advising traders in the Chicago futures and options pits, has three managing partners overseeing about 100 lawyers in its investment fund advisers and derivatives group, 65 of whom deal principally with hedge funds. New York–based Sidley Austin partner Michael Schmidtberger says the evolution of big hedge funds is making the job of the ﬁrm’s lawyers more challenging. “These are complex ﬁrms that need more structure to their liquidity and capital bases if they are to continue growing,” he explains. And since many hedge fund lenders and investors headed for the door in response to this summer’s volatility, he believes there will be a rise in the number of permanent-capital- seeking transactions within the industry. “We saw that some of the same problems that can affect ﬁnancial institutions, such as a run on the bank, can also apply to hedge funds — at both an equity level and a debt level, with prime brokers and counterparties making margin calls,” says Schmidtberger. The race for top onshore law firm was tight this year, with Sidley Austin holding a slim lead over New York– based Seward & Kissel, which moves up a notch from its third-place ﬁnish in the 2006 Alpha Awards™. Hedge fund advisory is the cornerstone of Seward & Kissel’s law practice. The firm, which in 1949 helped establish New York–based A.W. Jones & Co. — the first hedge fund, for which Seward & Kissel still has the documents it drafted to create that partnership — has eight partners in its private funds group and more than 45 attorneys who work with hedge funds. Yet hedge funds touch all parts of Seward & Kissel. “Everyone across the ﬁrm, whether a tax attorney or in the ERISA part of the ﬁrm, has dealt with fund-related issues in one way or another,” says partner John Tavss. Earlier this year, Seward & Kissel hired James Abbott, an expert in business transactions and corporate ﬁnance and formerly with New York–based Carter Ledyard & Milburn, to advise clients on the rising number of private equity deals and mergers taking place within the hedge fund industry. Rounding out the top three in this year’s overall ranking is Akin Gump Strauss Hauer & Feld, which makes a significant jump from TOP OFFSHORE LAW FIRMS Rank 2007 1 2 3 2006 1 2 3 Firm OGIER MAPLES AND CALDER WALKERS OGIER James Bergstrom, 39, Partner and Co-Head of Hedge Funds Practice FOR JAMES BERGSTROM, head of Ogier’s investment funds practice, life is good, and not just because his firm is based on Grand Cayman. “We have had, by far, our busiest year yet,” says Bergstrom, who joined the small Cayman law firm Boxalls in 1992. For years he has been expecting the start-up fund business to slow down; as the number of launches continues to rise, it has done anything but. Ogier, which was formed in 2003 with the acquisition of Boxalls by Jersey firm Ogier & Le Masurier, boasts 40 hedge fund lawyers worldwide. Ogier is the youngest of the Cayman-based offshore law firms that dominate the hedge fund industry, but youth has not stopped the firm, as clients rave about its hedge fund expertise.

Table of Contents Feed for the Digital Edition of Institutional Investor's Alpha Magazine - October 2007

Institutional Investor's Alpha Magazine - October 2007 Contents Letter from the Editor Longs & Shorts Pension Corner: Applied Knowledge The Good Guys: Autism Advocate Interview: Nerves of Steel Cover Story: Ivy League Education Alpha Awards: Top Service Providers: Trying Times Strategies: Passage to India Profile: The Oracle of Irvine Alpha Bytes: Futurama Research Center: Funds of Funds 50 Unhedged: Commentary: Crisis? What Crisis?

Institutional Investor's Alpha Magazine - October 2007

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