A festival of finance; a merry-go-round of M&A – this New Yorker puts on quite the show in London town.
Sterling's silver platter
If corporate and finance work is your jam, your list isn’t complete without Shearman & Sterling. Big banks such as Goldman Sachs, Deutsche Bank and Barclays line up one after another to work with this elite New York institution, while the corporates Shearman services can be just as titanic – General Electric, the state-owned Bahrain Petroleum Company and Nokia serve as excellent examples. According to the Chambers UK rankings in banking and finance, capital markets and corporate/M&A, the firm's usual companions are the magic circle and the elite US firms – and for projects, the firm is ranked as one of the very best in the UK. And globally, we'd also single the firm out for its flair in arbitration. It’s therefore fair for Shearman’s budding young trainees to describe their firm’s work as “inspiring and impressive.” They could have at least used the word Sterling.
The firm has 22 offices to its name, spanning the Americas, Europe, Asia, and the Middle East. Only five are in the States, despite a “long New York history” which stretches back to 1873. The firm's time in London is short in comparison – its doors were flung open in 1972, and nowadays it ushers in up to 14 trainees per intake. But London doubles as a launchpad; overseas seat options in locations like Singapore and Abu Dhabi put a rocket under juniors' wanderlust.
“If you impress in previous seats it will filter through the whole firm.”
There are usually 11 or 12 seat options in all, but everyone must do at least two seats in the firm’s three core departments: finance, M&A or project development and finance. Incomers are assigned their first seat without a say, “which is by and large a good thing not to have that on your mind.” However, starting in an advisory team (ie not a core department) means “you’ll then only have one chance to actually choose an advisory seat because you have to do at least two seats in the core transactional departments.”
Before each rotation, trainees can scope out their options at a departmental fair: “Reps from each department sit at desks in this big conference room and you make your way round.” They then have a week to rank their preferred seats (“all 12 if you want”), and a couple of weeks later they find out where they’ve ended up via one-to-ones with HR. Those who’d missed out on top choices criticised: “Something we get told a little too often is that allocation depends on business need. We get that, but it’s got to be balanced with helping trainees have the career they aspire to have.” Others argued the system was theirs to make the most of: “If you impress in previous seats it will filter through the whole firm, and other departments will very much be gunning for you.”
Finance is the largest of Shearman’s three core departments and takes in as many as six trainees each rotation. “It’s a tough seat to start in,” said trainees, “because you’re at the heart of the corporate machine.” The department does both leveraged and structured finance but trainees typically work on the leveraged side – “because it has bigger needs.” Structured finance encompasses restructuring, refinancing and acquisition finance, and we heard that some trainees had worked on refrigeration manufacturer Frigoglass's €330 million restructuring. The team also represented investment manager Investcorp on the financing of its $210 million acquisition of ABAX Group, a Nordic vehicle tracking company. And, several international banks also used the firm to advise on their role as lenders in the $4.2 billion refinancing of tyre manufacturer Pirelli.
This was a much sought-after seat, but some noted that the large size of the team resulted in periods of lesser responsibility. For example, post-closing, trainees could “be compiling originals for a long period of time, which is just printing documents and putting them into a courier bag.” But trainees found the chance to prove themselves in more engaging “process management work.” It centres on completing the conditions precedent and “as a trainee you can really shine because you’re the one co-ordinating and following up when there are missing documents.” The highly international deals required a level head though – working withlocal counsel “could be like herding cats.”
Five trainees sit in M&A, a team which is happiest when handling high-end, cross-border transactions. The $9.3 billion split-off of Liberty Global’s business in Latin America and the Caribbean was Shearman's handiwork, and the huge telecommunications company is a long-standing client for the firm. In 2016 Shearman advised on its $8.2 billion takeover of British company Cable & Wireless. More recently, London’s M&A team advised General Electric on the multitudinous transactions which made up the reorganisation of its oil and gas business, ahead of its $32 billion acquisition of Baker Hughes.
“One of the public reorganisations I was on had more international jurisdictions than I can recall!”
Trainees experienced a mix of public and private work, private equity, and corporate auctions. Just like finance, the international aspect of M&A work at Shearman called for plenty of organisation: “One of the public reorganisations I was on had more international jurisdictions than I can recall!” Trainees described “time-pressured research and drafting of ancillary documents, like deeds to terminate certain agreements, or elements of a due diligence report.” Again, juniors had to take the rough with the smooth: “Trainees of course do the normal proofreading, bundling and collating of signature pages, but it’s not like you’re doing that every day. The more you impress, the more people are willing to give you responsibility.” And that could build to “negotiating non-disclosure agreements, preparing drafts of sale agreements, and liaising with local counsel and with the client directly.”
Shearman’s third core department, project development and finance (PDF), also takes five trainees, but two of these will go overseas – one to Singapore and the other to Abu Dhabi. The team works on the financing of projects, acting for the financial institutions lending money to the project, and the developers and investors taking the project forwards. Working on both sides like this “makes you a more rounded lawyer. Negotiating finance documents hinges on knowing how project documents work, and if you have an understanding of how both work then you can do a much better job.” The team recently advised Bahrain Petroleum Company on the $6 billion upgrade of an oil refinery, and advised construction company Daelim Industrial on a $3 billion motorway project in Turkey. Over on the lender side, Shearman’s client base is made up of commercial banks, development banks, and export credit agencies. The firm recently advised a group of international and local banks as lenders to a $3 billion power plant in Qatar.
Trainees started out with basic tasks like proofreading: “It can feel like you’re just dotting the i’s and crossing the t’s, but on the other hand it’s your window into understanding that transaction and getting yourself involved.” But, once again, they could also be “managing the conditions precedent and liaising with the borrower to make sure they comply with it.” Overall they felt their responsibilities were fitting: “There are so many complicated finance documents and you’re sometimes working on quite a number of deals at the same time – I wouldn’t be comfortable if I was thrown into the deep end.”
Each of the three core departments provides trainees with group-specific training. Projects has sessions every couple of weeks and hands out a term sheet “for understanding all the nuts and bolts.” M&A meets for weekly training over breakfast, and finance’s sessions vary between “how to do typical trainee tasks like preparing a closing set [aka a bible], while others are more about the actual law, like an introduction to structured finance.”
(Re)search for the hero inside yourself
In the advisory category, one trainee believes new starters will find “work that feels a lot more familiar to what you’ve done on the LPC.” There are seats in antitrust, litigation, international arbitration or financial institutions advisory, among others. All of these seats were research-heavy for the trainees, with an antitrust source commenting: “It might be your role to produce a lengthy research memo on a question by the end of the week. While in transactional seats, you might have just three hours to answer a ‘yes or no’ question.” The antitrust team recently worked on Japanese insurer Sompo Holdings' $6.3 billion acquisition of Bahamas-based insurer Endurance Specialty.
“You have the chance to meet people beyond the London office.”
Along with research, litigation trainees “could be bundling documents, co-ordinating with other parties on the claims, or doing doc review for investigations.” Work crosses teams too: “If there’s a dispute resolution clause in a contract, a transactional team might want to know if it’s been properly drafted, and what effect it would have.” Crossover was even more common in financial institutions advisory, which “assists transactional teams whenever queries come up.” In international arbitration, trainees had been able to attend hearings – on a construction case, “the Abu Dhabi team came to the City for the hearing, so you have the chance to meet people beyond the London office. Then a team in another office knows you and trusts you with work.” The firm worked for the Arab Republic of Egypt in two separate investor-state arbitrations. One concerned a subsidiary of the Israeli Bank Hapoalim, and centred on alleged Egyptian violations of bilateral investment treaties the state held with the US and Germany. Trainees can opt to do a seat with the international arbitration team in Abu Dhabi, and another overseas advisory option tackles antitrust in Brussels.
As is the convention with US firms, all our interviewees squeezed in some pro bono along the way. The office/firm sets an aspirational target of 25 hours, and “if you do 50 hours you get a star on your door! A lot of people have them.” Trainees had done all sorts, from “legal advice and corporate governance for charities” to “drafting a report on child labour laws in Africa.” Overall it made for “anice break from corporate stuff.”
Other than “a little presentation” from HR, trainees said the qualification process was fairly informal: “You have an idea of how well-received your application will be from conversations with partners and HR. It’s all wrapped up in the space of about five weeks.” In 2018 the firm kept on 11 of 13 qualifiers (offers were made to 12 second-years).
Trainees wanted to placate anyone wary of joining an American firm. The London office “doesn’t feel like the backwater of some bigger beast. It has its own culture.” Though aware of its long and prestigious history, trainees felt the firm’s reputation was “anachronistically white-shoe. American firms get a bad reputation as a hard place to work – it’s certainly challenging but you’re not without support. I’m not sure I’d manage if people were shouting and screaming 16 hours a day. The corporate culture is more relaxed here.”
“They’ll put out these delicious, freshly baked cookies in the meeting rooms. At Christmas it’s mince pies!”
That being said, it is a truth universally acknowledged that if you really want to do international work – of Shearman's quality anyway – “you have to be around for different time zones.” It was a toss-up between finance and M&A for the longest hours – both suffered from lurching ebbs and flows. During a particularly busy time in finance, trainees were staying “consistently until midnight.” The advisory seats provide “slightly more predictable hours” and trainees fortunately never had to slog it alone: “You’re with a good, intelligent bunch of people, which makes the long hours tolerable.” Those in the office after 8pm also receive up to £30 for a Deliveroo: “I’ve used it six times in the last two months, but this has been a quiet period!”
Another foodie delight ensures meetings kick off to a good start: “They’ll put out these delicious, freshly baked cookies in the meeting rooms. At Christmas it’s mince pies!” Sounds pretty good, but on the down side, the office doesn’t have a canteen, “which is kind of a bummer.” Trainees didn’t mind popping out for lunch at one of Shoreditch's diverse dining options, “but it doesn’t breed collegiality if there isn’t one place everyone can go.” That’s not to say Shearman doesn’t make up for it elsewhere. Fun flourishes in finance with trips away, most recently to Lisbon, and last year M&A skied the snowy slopes of Switzerland. Fitness freaks can enjoy softball, football, touch rugby, and netball, and for the less athletic, a Friday drinks trolley keeps up morale.
Trainees get to choose an NQ mentor and the firm pays for them to have two lunches each seat. “Mine has been an invaluable source of advice for everything from seat choices to well-being. And you can have a rant about stressful situations!”
How to get a Shearman & Sterling training contract
Vacation scheme deadline (2019): 20 January 2019 (opens 1 September 2018)
Training contract deadline (2021): 31 July 2019 (opens 1 September 2018)
Competition for training contracts at Shearman & Sterling is increasingly fierce. Applications for 2021 training contracts were up 35% compared to previous recruitment rounds: the firm received around 2,000 applications for its 15 training contract vacancies. At a base level, future trainees need a minimum AAB at A level and 2:1 degree.
Graduate recruitment manager, Paul Gascoyne tells us the online form – which is used for both vac scheme and direct training contract applications – “is pretty standard” and contains three open-ended questions: 'Why do you want to be a solicitor?' and 'Why Shearman specifically?' plus “a commercial question about our place in the industry.”
“There are four elements to an application that can help a candidate to progress to the interview stage,” Gascoyne says. “They are strong academics, evidence of relevant work experience, tailored answers to our questions and an error-free application form.” He mentions that while legal work experience is not essential for vac scheme hopefuls, it is a must for direct training contract applicants. “We like to see that, at the very least, they've attended firm open days or other non-assessed events – that shows they're committed to a career in the law.”
Interviews and assessments
Around 5% of applicants go on to a first-round interview. This takes place with either a senior associate or a partner and a member of the graduate recruitment team, and “isn't too formal,” according to Gascoyne. “We aim for a conversational tone to ensure it's a two-way process.”
Candidates are asked the usual 'Why law?' and 'Why Shearman?' questions because “we want to see a genuine interest in us as a firm. We also expect candidates to be able to speak knowledgeably about our place in the industry at large,” Gascoyne says.
Success at this stage leads to an assessment centre for training contract applicants; for vac scheme applicants this takes place in the second week of their placement. The day-long assessment centre starts with a written exercise that Gascoyne assures us “is accessible to both law and non-law candidates.” A group exercise in the form of a business case study follows. “Seeing how candidates behave and conduct themselves as part of a team is very important to us,” says Gascoyne. “Our London office is quite small, so we need to see that people can interact well with others.”
Next up is a case study assessment: candidates are asked to review a news story before discussing it with two lawyers. Forming a balanced argument is key, as is being able to discuss commercial issues confidently.
The final step is an interview, usually with two partners. We have it on good authority that this is “much more commercially-focused than the first interview.” According to Gascoyne, “a big part is also determining whether the interviewee will fit into our culture.” The day also includes a lunch with trainees; a tour of the office; and a drink with some of Shearman's lawyers to round off the day.
The vacation scheme
Shearman runs four vacation schemes: one in the winter, two in spring and one in the summer. All vac schemes run for two weeks and there's room for up to ten candidates on each.
Vac schemers spend each week in a different department. On top of that, “we try to connect those who express a particular interest in a certain area with relevant people around the office,” says Gascoyne. “We might arrange for them to have a coffee with a partner from that department, for example.”
He goes on to tell us that supervisors “are told to treat vac schemers as they would a first seat trainee. We want them to have as authentic an experience as possible.” Along with a supervisor for each department they visit, attendees are assigned a trainee mentor, whose workload they shadow in between various HR-led activities. Vac schemers undertake the assessments outlined above – written and group exercises, a case study assessment, plus a partner interview – during the second week of their placement.
Trainees who’d experienced other vac schemes were won over by Shearman’s: “Some firms give you fake pieces of work and put on too many socials. Here, they give you a taste of what it’s really like as trainee.”
The history of Shearman & Sterling
First the worst, second the best? Shearman apparently doesn't abide by that playground rhyme – the firm advised on the first ever IPO and the first sovereign wealth bond issuance, to name just two. Shearman's made up of more than just deal-doers but its financial and transactional practices are what Shearman's traditionally best known for so here's a brief look at the firm's history by way of its corporate and financial feats.
- In 1897, a quarter of a century after it was founded, Shearman acted for the National City Bank of New York during its acquisition of the Third National Bank of New York. This bank later went on to become Citibank.
- After the Second World War, Shearman advised a number of German companies on settling their external debts and facilitated the re-entry of companies such as Siemens and BASF into the American market. By 1953, the firm had earned the nickname 'German & Sterling', having provided assistance to 42 German corporations and 14 municipalities. On the domestic side of things, 1956 saw the firm advise Ford on what was then the largest equity offering to date.
- Demand from US clients to register on the Hong Kong Stock Exchange saw the establishment of a Hong Kong office in 1978, making Shearman one of the first US law firms to open here; a year later, the first private investment in the People's Republic of China took place, with the firm advising the People's Republic in negotiations with Houston-headquartered Occidental Petroleum to establish one of the world's largest open coal mines.
- 1979 also saw the beginning of the Iranian hostage crisis with the firm heavily involved in negotiations between US banks and Iranian investors, after President Carter froze Iranian assets in US banks. The financial negotiations which Shearman was involved in ultimately played a role in resolving the crisis.
- The Latin American debt crisis in 1982 saw many of the continent’s countries defaulting on international debt after the global recession of the late 1970s and early 80s; Shearman collaborated with the World Wildlife Fund to create the 'debt-for-nature swap' scheme, which tied debt relief to the preservation of endangered environments in Latin America, Africa and Asia.
- The 1990s was a particularly busy time for Shearman in Italy, with the firm advising on a number of privatisations and IPOs in the country. This flurry of activity would later prompt the opening of an office in Rome in 2002, and another in Milan eight years later.
- In the 1990s, the firm assisted Daimler to become the first German company listed on the New York Stock Exchange and advised on China Telecom's $4.2 billion IPO which, when the deal was done in 1997, was the largest Chinese IPO to have taken place.
- The firm's São Paulo office appeared in 2004, and Shearman immediately dove into the Brazilian IPO equity boom over the next three years, helping to complete more equity deals in Brazil than any other firm at the time.
- In 2006, with a little help from Shearman, the Iraq government re-entered the international debt market for the first time since Saddam Hussein's removal. A year later and the firm was working on yet another first, assisting on the first all-Chinese bank syndicate limited recourse loan.
- Things were hotting up in Mongolia for Shearman in 2012, as it advised the Mongolian government on bond offerings worth billions of dollars (the country's debut sovereign bond issue) and acted for several banks as the initial purchasers of $600m of senior notes offered by the Mongolian Mining Corporation (the first international corporate bond issued out of Mongolia).
- At the height of Europe's financial crisis, Shearman advised Piraeus Bank – the largest financial group in Greece – on its whopping €8.4 billion recapitalisation.
- In 2014 the firm advised in connection with the IPO of the Chinese social media site Weibo. The site is one of the most popular in China, it's China's Twitter, and as of 2017 had amassed over 361 million active monthly users.
Shearman & Sterling LLP
9 Appold Street,
- Partners 40
- Associates 200
- Total trainees 30
- UK offices London
- Overseas offices: 22
- Graduate recruiter: Paul Gascoyne, [email protected], 0207 655 5000
- Training partner: John Adams
- Application criteria
- Training contracts pa: 15
- Applications pa: 2,000
- Minimum required degree grade: 2:1 or equivalent
- Minimum UCAS points or A levels: AAB
- Vacation scheme places pa: 40
- Dates and deadlines
- Training contract applications open: 1 September 2018
- Training contract deadline, 2021 start: 31 July 2019
- Vacation scheme applications open: 1 September 2018
- Vacation scheme 2019 deadline: 20 January 2019 (winter) 20 January 2019 (spring/summer)
- Open day deadline date: Various
- Salary and benefits
- First-year salary: £45,000
- Second-year salary: £50,000
- Post-qualification salary: £105,000
- Holiday entitlement: 24 days pa
- LPC fees: Yes
- GDL fees: Yes
- Maintenance grant pa: £8,000
- International and regional
- Offices with training contracts: Hong Kong
- Overseas seats: Abu Dhabi, Brussels, New York, Singapore
Main areas of work
The two year training contract consists of four seats, each lasting six months. Two of these seats will be in our core practice areas (M&A, finance or project development and finance), while the remaining two are selected from the other practice areas. Trainees typically share an office with a senior lawyer allowing informal learning on the job, while the structured training programme at the firm ensures trainees get exposure to all the information they need to be a success now and in the future. In addition to the cross-jurisdictional work trainees do in London, they are also encouraged to spend a seat in one of our overseas offices, allowing them to further build their global networks.
Open days and first-year opportunities
This Firm's Rankings in
UK Guide, 2018
- Banking & Finance: Borrowers (Band 4)
- Banking & Finance: Lenders (Band 2)
- Banking & Finance: Sponsors (Band 3)
- Capital Markets: Debt (Band 4)
- Capital Markets: Equity (Band 3)
- Capital Markets: High-Yield Products (Band 2)
- Capital Markets: Structured Finance & Derivatives (Band 4)
- Competition Law (Band 5)
- Corporate/M&A: High-end Capability (Band 3)
- Tax (Band 6)
- Construction: International Arbitration (Band 3)
- Energy & Natural Resources: Oil & Gas (Band 3)
- Energy & Natural Resources: Power (Band 2)
- Financial Services: Non-contentious Regulatory (Band 3)
- Projects (Band 1)