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The LCN Interview: Rebecca Flanagan

Group Reorganisations


Intercompany Agreements

27 October 2021

Rebecca has just joined the LCN Legal team as a Director. She brings a lot of experience of advising on M&A and group reorganisations.


How did you become a specialist in group reorganisations?

I did my training contract at Clifford Chance, and I worked there for about four years post-qualification. Then I moved to a US firm called Dewey and LeBeouf. And then they started to go bust in 2012, so I moved to Dechert. It was slightly surreal: the partner I worked for just brought over his team together with all of his clients and matters, lock stock and barrel. I resigned one Monday morning and started at Dechert at lunchtime.

And then in January 2015, I got head hunted by KPMG, which had just got its SRA license and started a new legal practice. That was a change in my career. Before that, I'd been doing pretty much only M&A and joint ventures, particularly in emerging markets. When I moved to KPMG I started doing a lot more in the reorganisation side with tax teams.

I was with KPMG for four years, then I moved to Deloitte. A former colleague from KPMG was helping set up Deloitte's new legal practice. And they took quite a few of us on, but later that year they decided they had more people than they needed, so they let a few of us go. And then Coronavirus hit, which made life interesting. So I worked as a consultant for a while and then came to LCN Legal.


LCN must feel very different from the huge firms you worked with before?

Well, KPMG and Deloitte are enormous names, but the legal teams were quite small. At KPMG, the team I worked in most of the time was six people, so actually that's not hugely different.


What attracted you to LCN Legal?

The type of work they do, focusing on ICAs and corporate reorganisations. I’d say that’s my USP too. There are not so many people who specialise in corporate restructuring and intercompany agreements. So I felt that I could bring something to the team, and help them continue to develop that area.


Where do you think we are in the business cycle right now? Do you think we're coming to the end of the time when everything is defined by the pandemic, and entering the next phase?

I think, to some extent, a lot of people are just bored of being defined by Covid. I don't think we're ever going to return to normal. I think things have just changed too much, but I get the feeling there's a real appetite to just move on.

I remember talking to people in March 2020, when everyone thought that by about September everything would go back to exactly the way it was. Now I think people realise that there isn’t going to be a single moment when we can say, “It’s over.” It’s not like a war ending or something like that. Maybe in retrospect we will be able to see an end point, but there isn’t going to be a clearly defined moment.


What do you think the new commercial landscape will be for group reorganisations?

One big driver is often tax changes. Someone asked me recently: “Do you see group reorganisation as something that's going to permanently continue?” And I said, “Well, unless you think that governments are going to stop changing tax legislation, and I would be astounded if they did, reorganisations will always be necessary.”

When I was at Deloitte, we did a big reorganisation because the US had changed their tax rules: essentially we were just amending the intergroup financing arrangements, and we saved the client millions in taxes. We moved from it being a Luxco financing structure to being a UK/US financing structure. That shut down a potential big issue in the States from a tax perspective.

Other reorganisations are driven by group simplification. Maybe somebody new comes into the group and takes a look at it and says, “This is bonkers. Why are we running this number of companies? Let's just simplify everything.” It often takes a new person coming in to really see the situation for what it is.

And then there's the classic pre- and post-M&A reorganisations, which again won't go away unless people stop selling companies, which I don't see happening. So I think those drivers will always remain.


What aspects of GRO do you think are most widely misunderstood?

I think some people think it's very easy, partly because people slightly romanticise M&A and the adversarial relationship you have there. Because you've obviously got a buyer and seller, and they have got opposing interests. Whereas with a group reorganisation there might be some areas of the group where there’s a bit of tension, but ideally everyone is pulling in the same direction. So I think some people tend to think it's therefore less interesting.

It's often a lot more technical. In an M&A transaction, really, whether or not you win your point is much more based on the commercial realities of the transaction as opposed to what your legal point is. Whereas in a group reorganisation, if you're making sure that you've got enough distributable reserves and you're doing reductions of share capital, that's just technical. There's no commercial element that's going to tweak what you're doing. I think some people see it as being boring and not challenging, when actually the challenge is more for yourself.

It's not a challenge against somebody else, but it's a challenge to get the deal done quickly, efficiently and correctly. And that can be difficult, especially when it's a tax-focused reorganisation, because the client and the tax team have spent a long time designing this tax paper, they've had all the conversations, they know what they want to do and they hand it on to legal and they want it done. But the legal part of the process often involves often creating lots and lots of documents, all of which takes time to do and get right. It’s not unheard of for large reorganisation projects to last years.


Who in your career so far has been most influential?

There have been a few over the years. My supervisor in my first corporate seat, Mark Caroll: it was probably working with him that made me want to become a corporate lawyer. And then at both Dewey and Dechert I worked for a Lebanese lawyer, Camille Abousleiman, who's an amazing commercial lawyer, but quite tough to work for. That improved my skills hugely, because he was quite demanding and things needed to be done quickly. His clients weren't hanging around.

Also Simon Briggs, who I also worked with at both Dewey and Dechert. And then Richard Phillips and David White at KPMG, who developed me into the corporate reorganisation lawyer that I am. I owe Richard in particular a huge debt, because he was a great help when I was being posed with a completely new challenge, and he gave me the support and the structure to help me make that transition.


If you weren't a lawyer, what would you most like to be doing?

I don't know! I flirted with the idea of joining the Army, I think partly because my father's in the army so I come from a military family. I've been asked that question a few times – especially when I was working in emerging markets M&A, which was great fun and hugely challenging but came with a shocking work-life balance. But, honestly, even though I slightly fell into law there's nothing I'd rather be doing. And so I find it quite difficult to imagine.


That's probably a good sign.

It is. Also a bit worrying sometimes!


What are your hobbies?

I'm a big rugby fan. I normally try to go through two or three Bath games a season, although of course it’s not that easy. I enjoy going to exhibitions in museums. In a fortnight I’m off to the handbag exhibition at the V&A with some friends. Occasionally going out to the cinema or to see a play: just the usual going out and socialising with friends.


This is probably the hardest question of all: describe yourself in three words.

Oh, goodness. I see what you mean. I think one word is definitely ‘diligent’. Another one is probably ‘outgoing’. The third one is one that would resonate with my father (and maybe former colleagues I shared an office with)… ‘chatty’!


Who would be your ideal guests at a dinner party?

I've always thought Barack Obama would be an interesting one. Also Tom Brady, who was the quarterback for the Patriots and is now with the Buccaneers, and won the Super Bowl with them in his first season there. I find it fascinating that he's still doing so well. To win the Super Bowl aged 43, he's obviously super-dedicated, and I’d just be fascinated to talk to him about how he manages it. Although he might possibly be quite boring! Because to remain the top for that long in that sort of career, he's got to be very driven and manage his life quite carefully.

And, just out of curiosity, Winston Churchill would be interesting, I think, and also Nelson Mandela.


Finally, what advice would you give your younger self?

Maybe to live in the moment a bit more. But also, to keep in mind that what you're doing at the moment is laying down great foundations for what you'll do later on. So: appreciate what you've got at this time and what it's going to naturally lead you to, without being too worried about exactly how it’s going to lead you there.

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Article by
Paul O’Regan

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