Last week, Baker McKenzie announced the promotion of eight associates to its Bangkok office. Of all the firm’s remote offices globally, only Singapore has seen more lawyers promoted (nine). And this year’s promotions followed those of last year, when Baker McKenzie promoted eight other lawyers in Thailand.
This major partnership expansion in Bangkok, which is not normally considered a key legal market like Singapore, Hong Kong or London, comes as the company’s revenue in Thailand grew by 8% during the year elapsed, without taking into account foreign currency inflation, the company said.
And the business will continue to grow in Thailand, according to Bangkok managing partner Thinawat Bukhamana, particularly in the areas of fintech, digital assets and tokens, dispute resolution, technology, mergers and acquisitions and restructuring. It has had great success in attracting top talent, being the biggest international firm in the field, he added.
Offers, offers, offers
Thailand recorded a trade surplus of $1.46 billion in the first quarter of this year, nearly double the value of the same period last year and beating market forecasts of a deficit of $150 million. dollars. Lawyers on the ground say work is finally picking up after a fairly lackluster 2021.
Lawyers are hoping major deals are on the horizon. And so far, the outlook is promising. Strategic discussions are underway between the UK and Thailand for bilateral cooperation in addressing issues such as climate change, sustainability, health, technology and innovation. In addition, Chinese automakers are capturing large slices of Thailand’s rapidly growing electric vehicle market. The Chinese company Great Wall Motor is already the best-known brand of electric vehicles locally.
Japanese companies, banks and major trading houses are also continuing to invest in the country, with MUFG Bank recently announcing its $150 million acquisition of the local securities subsidiary of Nomura Holdings.
The domestic market is also picking up, with Thai telecommunications company, Advanced Info Service (AIS), planning to buy local broadband internet provider 3BB for more than $900 million.
The biggest deal this year could very well be Thai Life Insurance’s upcoming initial public offering, which plans to raise more than $1 billion. Baker McKenzie advises underwriters on listing and Allen & Overy acts on behalf of the issuer.
Last year, Baker McKenzie advised Thai energy venture capital firm Univenture BGP Co., Ltd. on a $313 million acquisition of Bangkok-based Eastern Cogeneration Company Limited. the deal was one of the biggest M&A deals of 2021. The company also recently acted for the Export-Import Bank of Thailand as part of a group of lenders on a $35 million loan dollars to Vietnamese companies, Truong Thanh Quang Ngai Power and High Technology Joint Stock Company.
True location is key
Despite its potential economic growth, the legal market in Thailand has shrunk. Baker & McKenzie is the nation’s largest international law firm with approximately 60 field partners. It competes with firms like Allen & Overy and Linklaters, although both are much smaller in size, with 29 and 27 lawyers in Bangkok respectively.
Interestingly, all of Baker McKenzie’s partners in Bangkok are Thais, and Bukhamana says the company’s localization strategy is key to its growth and also the reason why some of its competitors have failed to win. market shares. Baker McKenzie acts for both local and international clients, and does not prioritize international clients over local businesses, which have become an increasingly important client base for the office.
In 2017, Clifford Chance closed its Bangkok office and began serving Thai clients primarily from Singapore. Mayer Brown also announced his resignation last year, saying that “maintaining a very small office in Bangkok is no longer the most efficient way to serve our clients, whose legal needs are typically cross-border in nature.”
Although the approach differs from that of Baker McKenzie, this logic and strategy can also work. Last year, Clifford Chance advised Thai oil exploration company, PTT Exploration and Production Public Company Limited, on the issuance of $500 million of 2.587% senior notes due 2027. was conducted by its partners in London and Singapore. The previous year, he had advised Tyson on its acquisition of the Thai and European food businesses of Brazilian food processing company BRF. The purchase included four production facilities in Thailand.
A handful of foreign companies continue to operate in Bangkok, but with much smaller offices. DLA Piper has six partners, half of whom are litigation attorneys; Norton Rose Fulbright has nine lawyers there; Herbert Smith Freehills has nine; Watson Farley & Williams has six; and Hunton Andrews Kurth has 21. Most of their lawyers focus heavily on advising on energy and infrastructure projects.
Certainly, large international companies with a fairly balanced percentage of local and international partners also compete with some of the largest national Thai companies. Some of the smaller players, Bukhamana says, struggled to weather the impact of the pandemic and closed.
The strongest national players are Tilleke & Gibbins, Blumenthal Richter & Sumet, Weerawong, Chinnavat & Partners, Kudun & Partners and Chandler MHM.
But the competition is fierce, says Jessada Sawatdipong, co-managing partner of Chandler MHM, especially as companies, including foreign advisers, drive down fees to win work. To give itself an edge, former Thai firm Chandler & Thong-ek Law Offices merged with Japanese firm Big Four Mori Hamada & Matsumoto in 2017.
The combination proved successful, Sawatdipong said. Not only has the company gained a stronger brand, but it is now also on the radar of customers looking to do business where Mori Hamada has offices outside of Thailand. About 70% of its foreign customers are Japanese, and the remaining 30% are split between Europe, the United States and the rest of Asia.
The flow of Japanese investment into Thailand, particularly in real estate, is notable. Technology, banking and the automotive industry are key sectors for Japanese customers, Sawatdipong said.
In 2019, another Japanese Big Four firm, Nishimura & Asahi, followed Mori Hamada and also acquired a Thai firm: SCL Group. The other two of the Big Four, Nagashima Ohno & Tsunematsu and Anderson Mori & Tomotsune, also have local offices in Bangkok, although neither has acquired local practices.
Other Asian companies have also taken calculated action. Singaporean firm Rajah & Tann launched its Thai IP practice last year with the hiring of Nuttaphol Arammuang, who joined ZICO IP, where he was managing partner. In 2020, accounting giant KPMG also launched a legal services arm in Thailand.