Australia's newest foreign arrivals share the same lofty ambitions. But, as Justin Whealing discovers, their plans for local domination are worlds apart.

Clifford Chance and DLA Piper both marked their official entry into the Australian legal market with similarly lavish parties, but their business strategies are vastly different.

While it is rare to compare a law firm with a supermodel, in Australia Clifford Chance is taking a similar view as Linda Evangelista who once said that "she wouldn't wake up in the morning for less than $10,000".

The English firm is deliberately only targeting the big ticket items in Australia, looking to act on lucrative M&A and banking and finance work, as well as high-end litigation matters.

At its launch party in Sydney on 3 May, Asia managing partner Peter Charlton told Lawyers Weekly that the firm would pursue a strategy in Australia that fits in with its global model.

"I came to Asia and I thought, 'I like M&A and high-end litigation' and the most active M&A market in Asia is Australia," he says. "The things that make sense at Clifford Chance and stick with our global strategy are fund formation, high-end finance and particularly cross-border work. We are global leaders in financial regulation and the whole regulatory environment around the world is changing. Why shouldn't Australia have a piece of that and pay for it?"

There are certainly great opportunities for law firms to cash in on Australia's rebounding M&A market.

According to Thomson Reuters, M&A activity for Q1 2011 totalled US $39.9 billion (A $37.7 bn), the highest first quarter volume since the boom times of 2007. Much of this growth is being driven by Asian companies investing into Australia. Now, high-end legal advisers such as Clifford Chance are following the money.

"Australia changed, and suddenly it is interesting, not because it is full of lawyers or full of well-trained people to fuel our growth, it was because it was interesting to our clients," Charlton says.

"And where are our clients? They are in China, Japan, India, Korea - and they are all investing in Australia."

Clifford Chance Sydney managing partner Mark Pistilli says that while it might be "a risk" to target high-end corporate work and refer any add-ons, such as employment law or OHS matters to other firms, he is confident it is a model that will work.

"The reality is that as a small boutique firm, and CLCL is the same, we have been operating in the market for five years and have been quite comfortable to draw in experts from other firms," he says. "The way this model works is to be friendly with other law firms. So we abide by our ethical standards to refer pieces of work out and we often call on the expertise of others when there is a piece of the transaction missing."

Communication breakdown and learning from rivals

Clifford Chance generates around $200 million in revenue through its existing Asian offices in Bangkok, Beijing, Shanghai, Hong Kong, Singapore and Tokyo. After a strategic review in 2010, it decided the best way to enter the Australian market was via a merger with established corporate boutique firms, after years of negotiations with Mallesons Stephen Jaques had broken down.

"We were looking abroad, on the back of a boom, and around one third of our growth was with Australian lawyers, so what was interesting to us at this time in Australia was the people."

The merger route with Mallesons was eventually scarpered by the global financial crisis, and when Charlton took on his role as the head of Asia in late 2009, the Asia-Pacific was becoming increasingly influential in the global economy and numerous international legal firms were batting their eyelids at domestic Australian firms

Clifford Chance watched how Norton Rose and in particular, Allen & Overy had entered the Australian market, and learned from their experience.

Charlton settled on the merger model because of the ability to harness existing cultures and expertise within a small firm.

"I thought, 'I can do a raid on a firm, but I will get the same result as A&O, with a mix of some people that are good, bad and indifferent'," he says. "Then I thought, 'I will cherry pick three from here, three from there, one or two from here and there', and found it would be very, very, hard.

"You would have different cultures and people that don't know each other. It might work if you are lucky, but nine times out of 10, you are unlucky."

By merging with Chang, Pistilli & Simmons (CPS) in Sydney and Cochrane Lishman Carson Luscombe (CLCS) in Perth, the firm had offices ready to go and 14 partners on both sides of Australia that practiced in areas that suited the Clifford Chance model.

"I took two trips to Sydney and spoke to people and even though the first meeting with CPS wasn't great, and I wasn't sure, I got to know them very well and they grew on me and I thought 'this will work'. They told me the firm [I had] to talk to in Perth was CLCS.

"A couple of other partners [from Clifford Chance] met with Michael Blakiston and key partners at major Australian firms and they said the person that impressed them most was Michael Lishman and Ian Cochrane. So I went down and chatted to them and was also quite impressed.

"I like [CPS] being young and elbowy because it suits this market (Sydney), and I like the fact that [CLCL] are establishment and very well connected."

Seamless transition

As compared to Clifford Chance, the arrival of DLA Piper has been decidedly low-key.

DLA Piper formally entered the Australian market via its formal integration with five-year alliance partner DLA Phillips Fox, giving both sides a good chance to get to know each other.

It starts with a much larger headcount than Clifford Chance in Australia, with over 470 lawyers spread across five offices.

Like Clifford Chance, it will be utilising the existing strengths of its already fully functioning Australian practice, such as insurance and the firm's high-level government clients, and it will not be targeting high-end corporate work.

"Our vision is to be a full service business law firm. We are not there just for the big ticket, one-off M&A deals," DLA Piper Australia managing partner Tony Holland says. He added that his firm's model in Australia is "driven by if they have an IT issue, or a real estate issue or an employment issue, we can be there for all of their needs, not just one particular aspect."

While it might not have the blue-chip connections of its English rival, DLA Piper has size and presence in the global legal market. With over 4000 lawyers spread across 30 countries, Tony Holland says it is now the world's largest global law firm, and with the addition of its Australian practice to its existing six Asia-Pacific offices, its revenue is expected to exceed $350 million across the Asia-Pacific region.

The importance of its Australian operations to its Asian strategy is also arguably more important when compared to Clifford Chance.

Almost two-thirds of its lawyers in the Asia-Pacific will be located in Australia, while Clifford Chance has more lawyers on the ground in nearby jurisdictions such as China.

"You can't be a meaningful part of what goes on in the world without having a meaningful position in the Asia-Pacific region," US managing partner Terry O'Malley says.

As compared to Clifford Chance, which changed suitors and reacted to the actions of competitors in entering the Australian legal market, by having such a long and old-fashioned courtship with DLA Phillips Fox before sealing the deal, DLA Piper could work to a concrete timetable regardless of market permeatations.

"Genuinely, that had no impact at all," DLA Piper Europe managing director Andrew Darwin says. "We had a timetable mapped out and we stuck to our timetable. What everyone else did was a bit of a coincidence."