Latham secures 11-lawyer structured finance team as rebuild gathers pace

Latham & Watkins has landed a major boost to its London structured finance practice, confirming that nine lawyers have followed partners Franz Ranero and James Smallwood from A&O Shearman, swelling the team to 11.

The hire of Ranero and Smallwood - both leading figures in the European CLO market - was announced in April. But the scale of their team move only became clear this week, with Latham confirming the duo joined on 2 June alongside counsel Jasleen Gill and eight associates.

The group’s arrival comes at an important moment for Latham, which has been in rebuild mode after a wave of departures from its London finance bench - including around 40 lawyers to Sidley Austin alone in the past year, according to Law.com sources.

Comeback meets booming market

Ranero and Smallwood are seen as marquee hires in the structured finance space. Ranero, in particular, is ranked Band 1 for structured finance by Chambers, sits in the Legal 500 Hall of Fame, and is described by peers as a "grand master" of the CLO market. The pair advise across the full spectrum of CLOs and structured products, representing both arrangers and managers.

Their arrival comes as the CLO market heats up globally. A wave of asset managers and hedge funds are "pouring" into the $1.3 trillion CLO market, according to Bloomberg, fuelling demand for new leveraged loans and pushing up prices on the secondary debt market. CLOs - which bundle together loans and repackage them into tranches of bonds - are becoming increasingly lucrative for both managers and the investment banks that arrange the deals.

CLOs now account for around two-thirds of all US leveraged loans, with one prominent manager telling Bloomberg: "It really feels like we’re back in the situation where demand for CLO debt is going to outpace supply."

A&O's bench thins further

The exits leave A&O Shearman with just one CLO partner in London, Tom Constance. The team has faced instability over the past 18 months, including the short-lived tenure of ex-Milbank partner John Goldfinch, who left the firm following a drink-driving conviction and has since joined Proskauer.