Birchrose Associates’ Post

Law firm mergers these days follow five new principles (not necessarily in this order): 1. Mergers of equals are out of fashion, much easier to do a takeover. 2. Announce it first, then convince the partners to vote for it. 3. Despite what many say, scale does still matter and mergers provide an immediate cross-selling boost. 4. A difference in profitability need not be a dealbreaker (the latest two transatlantic mergers are evidence of this). 5. Adding too many surnames together to make a new name makes it sound rubbish. It just does. But this can be rectified later on. Can you think of number 6? Herbert Smith Freehills, Kramer Levin Naftalis & Frankel LLP, A&O Shearman #LawFirms #BigLaw #Mergers

The impending merger of Allen & Overy and Shearman & Sterling, coined A&O Shearman, signifies a substantial consolidation within Big Law megafirms. With nearly 4,000 lawyers and 800 partners across 48 offices worldwide and a combined revenue topping $3.5 billion, this merger garnered significant shareholder support, reflecting high expectations for its success. The merger aims to establish a legal powerhouse fluent in both US and English law, positioned to dominate major global markets. Behind the scenes, Leopard Solutions’ predictive Mergers and Acquisitions tool is dissecting the merger’s potential success, factoring in attorney patterns, merger history, and retention complexities. This thorough analysis equips firms with vital information to navigate the intricacies of the merger and ensure its success. Read our prediction of the success of the merger: https://lnkd.in/egzM8nAp #MergersAndAcquisitions #ShearmanSterling #AllenOvery #LegalNews

Nice piece by Habiba Cullen-Jafar and Louis Altmann at Law.com International about the Herbert Smith Freehills and Kramer Levin Naftalis & Frankel LLP. Details have since emerged about the five year investment plan which involves private equity (quelle surprise), class actions, energy, CIFIUS and antitrust. Thanks to Habiba for asking me for my thoughts this morning. #mergers #biglaw #amlaw

The details shared in this article are applied to law firm mergers or acquisitions of all sizes. Projected stats and information, And the actual results from previous mergers of similar size and scope to the ones you are interested in. With detailed stats on retention and attrition numbers over the years following the merger. All derived from tracking attorneys, law firms, and attorney movement for 20 years. This is one of the many great examples of how our industry leading data and intelligence reports are used for research and analysis to make informed and confident decisions.

"We decided we were looking for a firm in the $300m-$400m revenue range. Often when people think about US mergers, they imagine firms of similar sizes getting together, but that’s very, very difficult to do. "We didn’t look for an international firm; we focused on finding a strong US firm with limited or no overlap, and the firm that came out on top was Kramer." How to choose a transatlantic merger partner? From profits to geography and scale to culture - there's plenty to consider, as illustrated in this interview with Herbert Smith Freehills CEO Justin D'Agostino MH, who recently spoke to Georgina Stanley and Anna Huntley about the rationale behind the firm's merger with US firm Kramer Levin Naftalis & Frankel LLP - lots of interesting insight on doing such a deal. https://lnkd.in/enxi-eSi

In this recent article from Law.com, the author posits that going forward, Merger Committees may negotiate merger deals without owner or partner input, relying on synergies and “sales” to overcome objections post-Merger Agreement. Without building consensus in the partnership, I would bet retention will suffer. In larger, compelling deals, perhaps this matters less. In my work, it matters a lot. Read more here: #Evolve #EvolveLaw #LawFirmStrategy #LawFirmGrowth #LegalInnovation #LawFirmMergers

The Trump M&A boom is approaching, and experts are sharing their insights on what’s to come. Rising interest rates and valuations are making things challenging for private equity firms, but the sell side is still busy as smart firms spot valuable assets without strategic buyers. Stay updated on the latest trends in mergers and acquisitions by reading more here: https://okt.to/2KYMn8.

Associate Mary Frost-Payne discusses mergers and acquisitions (M&A), and provides a breakdown of the various stages of a transaction, an overview of some key motivators and tips on how to prepare for a deal. Follow the link below to read her article in full. #MandA #MergersandAcquisitions #Transaction #Deal #CorporateLaw

MERGER OF THE WEEK: This week Herbert Smith Freehills and Kramer Levin Naftalis & Frankel LLP announced their transatlantic merger, key takeaways are: = They will create a single global profit pool from day one. = The two firms are complementary in terms of international coverage. HSF has strength across the UK, Europe, and Asia, with a small office in New York. While Framer Levin has strength across the US with offices in New York, Washington DC, and Silicon Valley, additionally they have a sizeable office in Paris. = The two firms also have complementary Practice areas, notably disputes, and sectors including energy, financial services, infrastructure, mining, and technology. = The firm will be called Herbert Smith Freehills Kramer globally and HSF Kramer in the US. = From a number’s perspective, the firm will have revenues of more than $2bn, 2,700 lawyers, 640 Partners across 25 offices. = HSF have a strong history of growth via mergers, this is following the deal done 12 years ago when London’s Herbert Smith merged with Australia’s Freehills. = Financials of both firms – HSF have turnover of $1.6bn and PEP of $1.6m, while Kramer Levin have turnover of $435.2m and PEP of $2.4m. = The disparity in PEP – this is unsurprising, considering Kramer Levin’s coverage of the US market, but this will require a partnership remuneration system that accounts for this disparity, this is something UK’s Magic Circle firms have moved to address in recent years by changing their payment models. = This merger has key parallels with this year’s merger between Magic Circle UK firm Allen & Overy and Shearman & Sterling to create A&O Shearman. Commenting on the deal, Justin D’Agostino, who began a second term as HSF's CEO in May, said: "This is an excellent long-term, strategic move for our firms, our clients and our people – a bold opportunity to build an exciting international firm together, based on our strong cultures of collaboration, superb clients and people, and our existing areas of strength. This is just the beginning." #Legalmerger #HerbertSmithFreehillsKramer #BishopRockPartners

In the final run-up to the actual merger date of May 1, Allen & Overy and Shearman & Sterling LLP have managed to keep most of the partners on board. Although there have been a few notable departures from Shearman in anticipation of the merger, most of them have occurred in international offices, leaving the domestic footprint (the real object of Allen & Overy's desire) pretty much intact. Shearman has been able to do so through a series of forgivable loans to equity partners it wants to retain. Only a few have turned their noses up to the offer and have departed to other #biglaw players. But it is what the combined firm needs to do going forward is what is most important. Most obvious is the need to build up a private equity department that can rival any of the other Top #biglaw players in the playpen. #merger #globallawfirm #privateequity #biglaw #forgiveableloans