IFLR 1000
The Guide to the World's Leading Financial Law Firms

The big news in the legal market this year is the demerger of the law firm Loze Grunte & Cers. Between four and six firms have emerged from the firm's ashes including the re-establishment of Grunte & Cers....

The big news in the legal market this year is the demerger of the law firm Loze Grunte & Cers. Between four and six firms have emerged from the firm's ashes including the re-establishment of Grunte & Cers.

While a lot of sectors of the Latvian markets are slow, the collapse of Parex banka and the subsequent state takeover has proved a boon for law firms. A number of firms have won work from the fallout due to the sheer number of different stakeholders involved and the subsequent purchase of a stake in the troubled bank by the European Bank of Reconstruction and Development (EBRD). The need to draft legislation to allow the government to take control of the bank provided another window for firms to get work.

Financing work is in paralysis. International private funds are the main source of financing now, but it is a trickle of funding, not a flood. Most of the banking and finance work revolves around renegotiating loans. Traditionally banks in Latvia use in-house teams for this work, but they are struggling to keep up. This has allowed law firms to "find a way into the kitchen" on the bankers' side, according to one partner.

M&A is dead. Little has happened since the collapse of Lehman Brothers, a situation that is unlikely to change. Any activity is generally of the merger kind, and the expected sale of distressed assets is still to come. That might change as the year moves on as banks can no longer afford to extend the duration of borrowers' facilities.