Perth Hits the Spot
Situated on Australia’s southwest coast and at the edge of the vast outback, Perth has long reveled
in its image as the most isolated large
city in the world. Yet Australia’s fourth-biggest metropolis has lately become
one of the hottest destinations for international law firms.
When Magic Circle firm Allen &
Overy pushed into Australia at the start of
2010, it opened offices in Perth and Sydney with partners recruited mainly from
big domestic firm Clayton Utz. A year later Clifford Chance likewise chose those
two cities for its Australia launch, acquiring Perth’s 15-lawyer Cochrane Lishman
Carson Luscombe as well as Sydney’s
Chang, Pistilli & Simmons. In August,
when Squire, Sanders & Dempsey moved
into the country, it opened in Perth alone,
acquiring most of the 80-lawyer local office of Australian firm Minter Ellison.
In the past, the few international
firms that ventured into Australia stuck
to the country’s traditional economic
centers in Sydney and Melbourne. So
why Perth now?
“We like the connectivity between
Western Australia and the rest of the Pacific,” says Squire, Sanders chief executive officer James Maiwurm, who adds
that his firm is mainly interested in the
energy and resources sectors. These are
the areas now being heavily targeted for
investment and acquisitions by Chinese,
Japanese, Korean, and Indian companies.
Those deals are overwhelmingly focused
in the state of Western Australia. Perth
is the capital of the state, which is four
times the size of Texas.
ALLAN BAXTER/GETTY IMAGES
Mining is traditionally the chief industry in Western Australia, one of the
richest iron-ore producing regions in
the world. But it’s not just what’s in the
ground that has made the area attractive
to international firms. The mining expertise concentrated in the region has led
to Perth-based companies leading metal
ore exploration and development efforts
around the world, particularly in Africa.
These are not necessarily the big established names, like the Anglo-Australian mining giants Rio Tinto Limited and
BHP Billiton Limited (which are actually
based in Melbourne, though they have
large operations in Western Australia).
Despite its isolation, Australia’s fourth-largest city has
become one of the hottest destinations for international
law firms setting up shop Down Under.
Sometimes called the Silicon Valley of
mining, Perth is more known for its large
number of small and medium-size mining
companies, many of which are startups
looking to go public or get bought out.
Many of those potential buyers are
coming from Asia. Squire, Sanders’s
Perth lawyers have previously advised
local mining company Midwest Corporation on dealings with China’s Sinosteel
Corporation, which now owns a majority stake in the Australian company.
Squire, Sanders also advised another
Perth mining company, Kagara Ltd., on
a strategic alliance with the Guangdong
Foreign Trade Group. Earlier this year,
Geoff Simpson, head of Allen & Overy’s
Perth office, advised the city’s Equinox
Minerals Limited in a competitive bidding situation that saw a $7.8 billion bid
from Canada’s Barrick Gold Corporation
trump a bid by China’s Minmetals Resources Limited.
When it comes to Asian investors,
Perth is not nearly so isolated as it might
seem. Unlike Australia’s other major cities, it is in the same time zone as Beijing,
Hong Kong, and Singapore, while only
an hour behind Tokyo and Seoul. Perth
is roughly three hours closer to Asia’s
business capitals by plane than Sydney or
Melbourne.
“It has that advantage of proximity,”
says Maiwurm. “To me, it seems a much
more direct link.”
Ian Cochrane, whose Perth boutique
firm became the local office of Clifford
Chance through a merger this year, says
that Perth is emerging as an industry hub
with exploration and operational exper-
tise gathered in the same place with fi-
nancial and legal expertise.
