Law Firm Merger Market Picked Up at Year End
Newtown Square, PA, January 5, 2011 — There were 15 new law firm mergers and acquisitions announced in the United States in the fourth quarter of 2010, rebounding to near pre-recession levels for the October to December time period, according to Altman Weil MergerLine. Fourth quarter merger announcements accounted for 38% of the year’s totals.
“The upswing in law firm merger activity in the fourth quarter is a leading indicator of what we expect will be a busy year for law firm combinations in 2011,” said Altman Weil principal Ward Bower.
Despite the year-end rebound, the total number of 2010 law firm deals announced was 39, down from 53 in 2009 and 70 in 2008.
The two biggest deals announced in 2010 were both transatlantic mergers of US and UK law firms. Sonnenschein Nath & Rosenthal, a 655-lawyer firm headquartered in Chicago, merged with Denton Wilde Sapte, a 600-laywer firm based in London. Cleveland-based Squire Sanders & Dempsey announced their intention to merge with UK firm Hammonds to form a 1,200-plus lawyer firm.
Another major cross-border merger announced in December 2009 was finalized in May of 2010. The merger of Britain’s Lovells LLP with Washington DC-based Hogan & Hartson was the second largest law firm combination ever made, forming a 2,500-lawyer global firm.
“There were five international mergers involving US law firms announced in 2010, up from four in 2009 and only two in 2008,” according to Bower. “Despite the recession and its many distractions, the importance of a global strategy cannot be ignored.”
The other significant 2010 deal, was the November announcement of a merger between Atlanta-based Kilpatrick Stockton and San Francisco-based IP firm Townsend and Townsend and Crew to form a new firm of approximately 650 lawyers. Kilpatrick Stockton also acquired an Oakland, California construction boutique in October 2010.
Almost 80% of 2010 combinations involved the acquisition of small law firms with 20 or fewer lawyers, continuing the 2009 trend toward small, targeted deals. Forty-four percent of 2010 law firm combinations were either cross-border or multi-regional US deals, up from 40% in 2009.
“Mergers that extend a firm’s geographic scope are prevalent now because they provide access to new markets and new business, as well as allowing firms to serve their existing clients in new locations, potentially increasing their share of the client’s legal expenditure,” Bower said.
The complete list of 2010 law firm mergers and acquisitions as well as an archive from prior years and a four-year trend summary are available online at www.altmanweil.com/MergerLine.
About Altman Weil MergerLine™
Altman Weil MergerLine™ logs law firm combinations as they are reported by media outlets and in press releases; links the user to the original news stories; and, compiles key statistics on each deal. The online service also includes an archive of past mergers and a section of commentary and analysis. Learn more at www.altmanweil.com/MergerLine.
About Altman Weil
Founded in 1970, Altman Weil, Inc. is dedicated exclusively to the legal profession. It provides management consulting services to law firms, law departments and legal vendors worldwide. The firm is independently owned by its professional consultants, who have backgrounds in law, industry, finance, marketing, administration and government. More information on Altman Weil can be found at www.altmanweil.com.
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