Renegade master

27.08.09

 

This article was written by Maria Jackson, journalist, and published in the July / August edition of Legal Business about Bijan Sedghi, partner in Wragge & Co LLP's Corporate group.

Aged 28, Bijan Sedghi joined a Midlands-based plc and proceeded to increase its value from £500,000 to £110m before returning to law in 2006. HBJ Gateley Wareing wasn't big enough to hold him, will Wragges do a better job?

Bijan Sedghi is the type of lawyer most PR teams would keep a close eye on. He is a self-confessed 'turbo-charger', with three Blackberrys, a contact list that is would make Richard Branson baulk and a commercial determination to be involved in every decision his employer makes.

'Oh dear, the renegade master. What's he been telling you?' was the unperturbed response received when LB contacted Wragge & Co to discuss this feature. The informal culture that Wragges prides itself on seems to be a good fit for the energetic Sedghi, who has long refused to conform to the stereotype of an academic lawyer. 'My experience was in building and growing businesses, and then managing them for the best profit', he says. 'Few lawyers really understand that they should also be doing that for themselves as partners. They put the vocational aspect first, in front of financial efficiency'.

It's a tough balancing act. Clients want commerciality and corporate nous, but the skills involved in spotting opportunities and risk-taking go against the grain for most practitioners. 'There aren't many lawyers doing what I am doing,' Sedghi adds with his trademark confidence. 'And I prefer it to be like that.' So other would-be rainmakers who feel their job should be more than just blindly following client demands and executing contracts, take note.

Starters orders

Sedghi trained at Wragges, leaving in 1978 to join Edge & Ellison (acquired by Hammonds in 2000), where he became a partner and insolvency specialist. He's far from tight-lipped on his reasons for leaving the firm. 'I'm ashamed to say I left Wragges because I was offered a shiny new car by Edge & Ellison – who also matched my salary,' he admits. When the insolvency bubble burst in 1984, he started to focus on M&A until the then Pinsent Curtis referred a client to him. Bromsgrove Casting & Machining, which was capitalised at £500,000. The remit was to sort out a long-running shareholder dispute that was, in Sedghi's words, 'a David and Goliath battle between the mighty Eversheds (acting for a former MD) and the tiny Jacobs Bird (acting for the chairman).' Not only did he sort out the dispute, he was asked to join the board. Unsurprisingly, he felt he was in over his head. 'Aged 28 and an insolvency lawyer, I hardly had the right credentials to join the board of a company quoted on the main market,' he says. 'So I refused. Only to suffer the wrath of my then senior partner, John Wardle, who told me to get on with it because it would help my career.'

Sedghi stared as a non-executive director in 1983, but it was a baptism of fire. The company made cast-aluminium gearboxes for Austin Rover, which accounted for 95% of the order book. He helped Bromsgrove to increase its customer base and product range, finding use for his insolvency skills through investment in distressed competitors. 'Frequently, we would clear a competitor's premises and relocate tools and dyes to our main foundry during the night to ensure production was maintained and the supply chain kept intact,' he explains. 'I know how to drive a forklift through this very exercise.'

Throughout the whole experience, Sedghi continued to work at Edge & Ellison, sharing his time between the factory and the boardroom. However, his initial 6% stake in Bromsgrove overtook the value of his capital account at the firm, so when the board asked him to join full-time, he came to an agreement with Wardle to spend 20% of his time in the office and the other 80% at Bromsgrove. He eventually quit Edge & Ellison to become the company's chairman and CEO, taking what became BI Group from a base of £2m sales to turnover approaching £250m, and overseeing a much-publicised divestment programme. He mentions the company's disposal of its orthopaedic business to a privately-backed buyer in 2000 as one of the highlights of his career.

 'I learned that if you have something really special, don't be hasty to take the money and let it go without getting next year's price today,' he says. 'We made a lot of profit on that disposal, but I did miss the world-class businesses that we had built up.'
 Duncan McPherson, eventually one of Sedghi's most trusted lieutenants in BI Group, saw this determination first-hand. BI Group bought his business in 1989, and he rose to become chief operating officer. 'Bijan was eye-opening,' McPherson says. 'He made things move, and without any background in manufacturing. He bought your company and made it play to its strengths.'

BI operated six divisions, covering aerospace, marine, automotive, environmental and other industrial uses. Sedghi was quoted in The Independent in 1994 as saying he wanted to concentrate on niche areas, producing specialised products for international markets, and it's a game plan that he thinks is equally applicable to law firms. When asked which firms will fare well in the current economic climate, Sedghi replies: 'Those firms which have their costs under control and those which have a broad spread of international earnings so they are not as reliant on the UK market.' It is a strategy he later implemented at HBJ Gateley Wareing and Wragges senior partner Quentin Poole has also alluded to the growth of overseas offices subsequent to Sedghi's arrival. However, HBJ was not quite ready for the dynamism that the brought to the table.

Square peg

Sedghi sold BI Group in 1996 for £110m to Kuwait-based National Industries Company, which bought the business to secure specialist technology the group had developed in oil and gas. He remained with the new owners until 2005, developing his Middle East contact book at a time when the region was becoming a significant draw for global law firms looking to tap into its liquidity. But at the time Bijan had other plans, at 52 he had decided to retire.

'My retirement was nothing short of desperately boring,' Sedghi admits. 'I played around with property as an investment and suffered business withdrawal symptoms. It was also clear that my retreat to the home had disturbed my wife's daily rhythm. She told me I was getting under her feet.'

At the end of 2006, Sedghi accepted an offer from HBJ Gateley Wareing to join as a director. It had been exactly a year since the firm had embarked upon its name-making merger; a tie-up between Scotland-based maritime specialist Henderson Boyd Jackson and Midlands corporate firm Gateley Wareing, which crated a combined £30m turnover and inspired national ambitions. Sedghi was brought on board to cement the firm's growing profile. 'It wasn't initially a chairman role,' says Michael Ward, senior partner at HBJ Gateley Wareing. 'Sedghi wanted to see if he enjoyed being back at a law firm again, and we wanted someone at the firm who could see strategy from both the legal and business side. We decided to just see how it went.'

HBJ has always been seen locally as highly entrepreneurial, and on paper it looked like a good fit. Prior to Sedghi's arrival, the firm had been on lateral hiring sprees, which were conspicuous enough for its Midlands rivals to take notice. It took several property partners from Wragges and Hammonds in 2002 and followed that up with two corporate partners in 2003, again from Hammonds. The raids brought its total number of partners up from 15 in 2001 to 23 two years later.

Significantly, Sedghi was not the first business leader Gateley Wareing had hired to plot its strategic direction. The firm appointed Frank Graves – a chartered surveyor and former president of the Birmingham Chamber of Commerce – as a consultant in 1996' and then Aston Villa Football Club finance director Mark Ansell as a consultant in 1997. However, Sedghi was the most ambitious, becoming chairman in 2007. Ward says: 'He was doing a great job for us commercially – helping us to refine our tendering processes, raising our business profile – he needed the title.'

 Sedghi also upped the tempo, trying to replicate the rapid evolution model pioneered at BI Group in a law firm setting.

In April 2007, the firm acquired shipping and transport niche Shaw & Croft to obtain a London presence, followed by a takeover of Edinburgh and Glasgow outfit Boyds Solicitors just one month later. In 2007, turnover climbed by 13% to £35m and the firm recorded a very healthy 37% profit margin. Sedghi is also credited with orchestrating the firm's Dubai launch – its first international office – followed by another London platform through its Holmes Hardingham merger in 2008.

'We hired Bijan to challenge the firm, and he did that very well. But there is a difference between a partnership culture and a corporate culture.'
Michal Ward, HBJ Gateley Wareing

'I think I can move a bit quickly for some people,' Sedghi told Legal Business back in 2007 when he revealed the firm's plans for Middle East expansion. 'But Birmingham isn't big enough for this firm.' It seems that not everyone could keep pace with Sedghi's energy, but Ward remains sanguine about ruffled feathers. 'We hired Bijan to challenge the firm, and he did that very well,' Ward says. 'It's fair to say that there is a difference between a partnership culture and there are certain aspects where one would jar against the other. If you're a chief executive of a corporate, you're expected to lead from the front and make decisions – of course there is going to be a tension between that environment and the partnership environment.'

Nevertheless, the tension between the Sedghi and some elements of the HBJ partnership was palpable. At the end of 2008 Legal Business Awards, a dispute arose late in the evening when one partner expressed their unhappiness at the inclusion of Sedghi's name as a management figure in the Awards brochure. Ward and Scottish managing partner Malcolm McPherson helped Sedghi to downplay the friction on that occasion, but it was clear that some partners were unhappy with Sedghi's rocketing profile. Sedghi left HBJ eight months later, two years into what was originally anticipated to be a three-year assignment, when Birmingham's largest firm realised that some of the deals Sedghi was trying to pull off would be better resourced with them.

Full circle

After training at Wragges, Sedghi formed a long-lasting relationship with the firm. 'I used to see him on the other side while he was Edge & Ellison,' Poole says. 'He was very client focused. At some points the lines were blurred between the lawyer for the client and being the client itself. He was the first person I had come across with that level of commerciality.'

 Last year, Poole approached Sedghi with a view to harnessing that entrepreneurial background and exploiting his political and business connections in the Middle East, thus ramping up the firm's international presence. Sedghi's existing relationship with Poole and the sense that he had achieved everything he had set out to achieve for HBJ made the decision an easy one. 'They did not have to fight hard to hire me, Sedghi admits, although all parties are adamant that he left HBJ on good terms.

'He speaks the clients' language. His first thought is not the legal issues, but what impact a decision will have on the earnings per share of that company.'
Quentin Poole, Wragge & Co

His new role undoubtedly seems better suited to his business background. Poole has not created a senior title to cage him in; Sedghi is simply a partner, and his job specification is to go through the firm's client base creating deals and eyeing opportunities, leaving more room for him to stamp his personality onto his position than at HBJ. Poole is happy to give Sedghi that creative freedom. 'He speaks the clients' language,' Poole says. 'He's so strong on the financial implications of decisions and helping the client to pick out underperforming subsidiaries. His first thought is not the legal issues, but what impact a decision will have on the earnings per share of that company.'

His clients appreciate his unorthodox methods. 'Bijan is more commercial than any other lawyer I've met,' says Andrew Steel, partner at private equity company H.I.G. Capital. 'He specialises in three things: deal origination; getting you in the door to meet the chief executives; and then assisting to execute the transaction.' Although Steel admits that may not be suitable for all clients, for those hungry for deals, it's a valuable set of skills.

Former Aston Villa FC chairman, 'Deadly Doug' Ellis, who Sedghi worked closely with when he was a lawyer to the club, reiterates this. 'I used him because he was a tough negotiator,' Ellis says. 'He's got a sharp tongue and he can upset people, but he never upset me.' Again, this reveals a tough business streak not often found in the legal world, certainly not outside the Magic Circle. Which begs the question: why did Sedghi return to the law? Clearly, if it was just the lure of financial profit that attracted him, he would have remained in industry. 'The rewards in the law are significantly less, but I have some unfinished business at Wragge & Co. Returning here is like closing the circle,' Sedghi says. However, he's clearly still in a period of transition. 'The bureaucracy is sometimes taxing,' he adds. 'Lawyers take too long to make a decision, often the opportunity has passed.'

But Poole thinks that the culture at Wragges is helping Sedghi to readjust to the law firm environment. 'He has had to move from the hierarchical corporate world, where you just make a decision and everyone else goes straight into implementation mode,' Poole says, echoing Ward. 'In a partnership, you have to be consensual and get greater buy-in from people, but he's being collaborative because we have supported his projects.'

Sedghi, therefore, is not looking for another career challenge. 'Joining a City law firm is not on the agenda,' he says. 'I have given my commitment to Wragges.' It seems that the consensual culture at Wragges is allowing the renegade master to do what he does best: involve himself in every decision, play on a large stage and create deals without being bogged down by the legal detail. In short, making his stand-out ambition work for the whole firm, rather than simply drawing jealous glances. As Sedghi concludes: 'A marque name like Wragges does not need a turbocharger. It just needs to be driven carefully to more select destinations.'

For further information about this published aticle, contact Kathryn Hobbs on +44 (0)121 213 2397, Amie Ryalls on +44 (0)121 213 2360 or Rebecca Davies on +44 (0)121 213 2396

This published article may contain information of general interest about current legal issues, but does not give legal advice.