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Conversation with Waajid Siddiqui Partner at Hogan Lovells
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Conversation with Waajid Siddiqui Partner at Hogan Lovells

Bar & Bench

Bar & Bench spoke to Waajid Siddiqui, Partner in the New York office of Hogan Lovells. Waajid Siddiqui focuses on the firm’s India practice and has over 20 years of experience in domestic and cross-border mergers and acquisitions, and regularly counsels a variety of strategic and financial institutions. 

Bar & Bench: Talk us through your experience in assisting Indian companies in cross border transactions.

Waajid Siddiqui: Unlike most of our competitors in the region, we are primarily an outbound M&A transaction focused law firm; advising Indian strategic and financial players as they look for execution of projects/investments outside of India. These days that includes not only transaction between India and Unites States/Europe but increasingly with other BRIC countries; including India-China, India-Russia, India-Latin America. That’s where we have seen tremendous amounts of growth in the last couple of years with respect to outbound transactions from India.

We are about 2,200 lawyers in 50 different countries now. With respect to the Asian practice, we have nearly 400 lawyers in Pan Asia and that includes a very large group of lawyers in China with offices in Beijing, Shanghai and Hong Kong as well as offices in Singapore, Tokyo, Vietnam and the UAE as well.

Given our significant Pan Asia presence, we are able to help facilitate a variety of in-bound transactions as well; representing non-Indian concerns in those transactions where the presence of an international firm can provide accretive value. With the assistance of a few quality Indian firms with whom we have continuing relationships, we can assist our non-Indian clients with investments as well strategic relationships with Indian entities.

The key transactions that we have done over the years include representing GE in the sale of what is now Genpact Limited and the sale of Jaguar/Land Rover. We represented Tata Chemicals when they acquired US-based General Chemical Industrial Products, which is probably one of the larger acquisitions by the Tata Group in the United States. We have also assisted the Tata Group with financing work in Asia, Europe and the United States and most recently, represented Patni in the iGate transaction and the related tender offer and delisting. Our inbound into India practice is equally robust and significant with both capital markets representations and projects work.

I think our perception of the Indian legal market is that it is incredibly robust and sophisticated and our inbound clients are very well served by the Indian Bar. Our involvement in inbound transactions is limited to those opportunities where the presence of an international firm is necessary for some dimension outside of India for the transaction. But with respect to Indian law, we make certain that one of our Indian relationship law firms is representing our clients. That is both a requisite for compliance with the Indian law and an approach that has proved to be a very successful practical partnership. We have maintained close friendships with a small number of law firms in India; making certain that our clients receive the best quality advice possible.

Bar & Bench: How big is the India legal team? Can you help us understand how the India team is structured?

Waajid Siddiqui: Globally, we have over a 100 lawyers who are actively involved in the India practice. They basically provide assistance to those clients seeking inbound work as well as outbound transactions. The center of our India practice is centered in Singapore, primarily because of the very significant projects and capital markets work that we source out of Singapore. We recognize that Indian strategics and financial players are comfortable with Singapore as the closest capital market and as such we have located a number of practitioners in and around Singapore that provide continuous service.

Our India team is primarily allocated on the basis of industry expertise and geography. We have fairly well focused products that we offer to clients not only in India but in other foreign markets as well.

We are a 100+year-old law firm in the United States and Europe. We have a historical presence in Washington DC and London and that has given us a depth and breadth in regulatory matters that is probably second to no other firm in the United States or Europe. As we have moved into the Asian markets, we have leveraged that significant regulatory strength and expertise. We provide a unique product to our clients who find themselves in highly regulated markets such as the commodities, energy, media, telecom, financial services etc. Our differentiation is the ability to offer not only quality deal execution but we are able to help our clients on a very sophisticated, commercial level through the regulatory maze around the globe.

It’s no longer sufficient to be able to get your deal done on Wall Street or Dalal Street, what you have to be able to do is to sell that deal in Washington or New Delhi or San Paulo or Beijing. That has become as critical component of M&A as the execution itself. That combination of sophisticated deal execution and regulatory advice differentiates us from our competitors to our clients. So whether it is Beijing or Moscow, every one of our offices has a tremendous regulatory presence in that particular jurisdiction or market and we are able to bring that expertise to the service of our client.

Bar & Bench:  Your experiences working alongside Indian law firms – How do you rate Indian law firms on competitiveness and quality?

Waajid Siddiqui: Our experience with the quality of Indian law firms has been superb. I think the Indian Bar is composed of some incredibly talented attorneys especially in the transactional field where I get to interact with them on a regular basis. I think it is no secret that the litigation Bar is extremely strong and the overall quality of lawyering in India over the last 10 years has been phenomenal. The Indian Bar is just as sophisticated and just as prominent as the Bar of any other major market.

Bar & Bench: What are your thoughts on Best friend relationship and do you plan to enter one?

Waajid Siddiqui: We have put in a lot of thought into this. Our position is that we have very good relationships throughout India and I am not talking about one or two firms but about half a dozen very close relationships in India. I think that focus serves both our clients as well as provides our partners in India with the opportunity to offer a broad range of expertise in almost every sector and geography of India.

I think as we develop our practice and as the Indian law firms begin to expand their practice outside of India, that may well change but at the moment we think being able to work with a number of Indian law firms is beneficial both for our clients as well as our partners in India.

Bar & Bench: In 2009, Hogan and Lovells merged. Do you think the strategy towards the India practice changed post-merger?

Waajid Siddiqui: First of all, both legacy Hogan and Lovells had very robust India practices. Hogan had more of an M&A focused practice in India prior to the merger and Lovells had a more of capital markets and projects focus in India. The merger has given us the ability to offer both our clients in India as well as our clients outside India, a full suite of services with respect to outbound as well as inbound India work.

In the last two years, we have done as much projects work in India as we have done M&A work in and out of India. Similar to the synergies in various other practices, the two firms’ India practices very much complemented one another and we have been able to now have this tremendous presence and coverage in Pan Asia that we were not able to otherwise do on our own. That, I think, has really been an advantage and growth of our India practice. We have been able to do far more Pan Asia cross border work out of India than we probably would have been able to do prior to the merger.

Bar & Bench: Do you think the corruption scandals in India have made investors very cautious about Indian market?

Waajid Siddiqui: Every economy, whether developed or developing, goes through upheavals that are part of the modern economic life these days. I think that the Indian economy is extremely sound with respect to its competitors around the globe. Although there are particular sectors that are affected by political uncertainty in India, I think overall the economy remains incredibly stable. It is also very clear to investors (both in India and outside of India) that India is going to resolve all those issues through a very clear political process. It has not been a situation where people are shying away from investments in or out of India because of any sort of systemic political issues. The issues that India is grappling with is not unique and a logical consequence of a modern developing economy. It is unfortunate when such issues impede growth but it is also a testament to India that it intends to resolve all these issues through a relatively clear, democratic and transparent political process.

Bar & Bench: With regulatory uncertainty and policy gridlock, what is the investor sentiment for the Indian market? 

Waajid Siddiqui: This year’s proposed budget had the unintended effect of creating significant uncertainty in the international M&A market with respect to India transactions. The cumulative impact of proposals regarding retrospective amendments for taxation of transfers of Indian business or assets through overseas structures, the taxation of purchase of software and database subscriptions, the amendments extending transfer pricing provisions to domestic transactions, and the introduction of the general anti-avoidance regulations (GAAR) all created an environment that made it exceedingly difficult for investors to properly value assets. 

The inability of investors to quantify the risk created by the implementation of these proposals and consequently allocate those liabilities had a negative impact on valuations and tempered the enthusiasm to pursue transactions without clearer guidance. Regardless of the political debate that surrounded these proposals and the relative merits of the positions, the M&A market reacts poorly to any uncertainty (especially as some of these proposal sought to explicitly overturn Supreme Court decisions). But inevitably, as these issues resolve themselves through the political process, investors will be able to better price risk and the uncertainty is resolved. For instance, I think everyone understands the political impetus behind the GAAR but until there is greater transparency and direction as to how these rules will be applied and enforced, I think investor sentiment will remain bearish.

Bar & Bench: What is your take on the Legal Process Outsourcing (LPO) as an evolving area of business? How do you think law firms modify their businesses in the view of changing dynamics?

Waajid Siddiqui: LPOs have become very significant aspect of international legal services. One of the unique aspects about innovations in legal services is that they are fadriven less by the law firms themselves than they are by clients. Law firms are typical service organizations; as much as they try to introduce efficiencies, the success of those efficiencies is dependent on their appeal to the clients that are being serviced. We don’t usually drive the type of innovations that you see in other industries.

Having said that, I think our clients are now driving the innovations with respect to LPOs. Especially after the 2008 global recession, I think there is a very different model of legal service delivery across the globe and cost is becoming a very significant driver for our clients. The clients are exploring and requiring their service providers to look for efficiencies and LPOs are a very easy way to do that. As you know in the transactional practice, LPO development has been a bit slower than in the litigation practice but I think it’s catching up. LPOs have begun to offer to law firms and their clients risk management models that are responsive to the historic concerns. I think the outlook of everyone in the industry is that the LPO model is going to become a very significant part of international law services delivery.

Bar & Bench: The Indian legal market – How do you view it? Your views on liberalization and entry of foreign law firms.

Waajid Siddiqui: I think the Indian Bar has every right to determine who it allows into the market and who it doesn’t. I personally think that the Indian market would be well served if it allowed foreign competition into India. But we are extremely respectful of the fact of that this is part of the Indian economic and political process.

At the moment, we are not hampered in the growth of our business by our inability to practice in India. We are extremely comfortable with the quality of legal services in India and our ability to partner with Indian firms (in the same way we partner with firms in 40 other jurisdictions). We hope that the market liberalizes but we also understand that it is purely an internal issue for India to determine. We are hopeful that we can continue to service Indian clients abroad.