Law Firm Mergers Slow in Second Quarter

Newtown Square, PA, July 8, 2009 — There were seven new law firm combinations announced in the U.S. in the second quarter of 2009, according to Altman Weil MergerLine.  This is the smallest number of deals reported in a quarter since the tracking service was launched in 2007.

“Since late last year, the recessionary economy and credit crisis has curtailed most law firm merger activity and has caused many firms to adopt a ‘wait and see’ philosophy about future financial performance,” says Altman Weil principal Bill Brennan, who advises law firms on mergers and acquisitions.  “In the face of so much uncertainty about the future, law firms are unwilling to absorb risks inherent with opening new offices or adding new practices.” 

“Instead of law firm mergers, we’re seeing a lot of activity in the acquisition of laterals, small groups and very small firms.”

The seven deals announced were all acquisitions of small law firms, between 3 and 35 lawyers in size.   The deals were spread across the country, including three in the Midwest, one in the Middle Atlantic states and one in the South.  Two were multi-regional combinations.

Barnes & Thornburg, an Indianapolis-based AmLaw 200 law firm, was the largest firm involved in a deal, announcing their plans to acquire the 22-lawyer Parsinen Law Firm as a Minneapolis base.

“We expect that mergers will be a lagging market indicator, not picking up again until the fourth quarter of 2009,” Brennan says. 

“That means right now it’s a buyers market, with some great opportunities out there and not much competition for them.  Entrepreneurial law firms have a real chance to change the balance of power through aggressive expansion, if they can tolerate some short-term risk.”

In the first quarter of 2009, there were 25 law firm mergers and acquisitions reported.  In 2008, there were a total of 70 mergers, including 18 in the first quarter, 26 in the second quarter and 13 each in both the third and fourth quarters.

A complete list of law firm mergers and acquisitions announced to date in 2009 as well as an archive from prior years is online at www.altmanweil.com/MergerLine.

About Altman Weil MergerLine™
Altman Weil MergerLine™ is an online tracking service hosted by legal management consultancy Altman Weil, Inc. It 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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Contact Information

Bill Brennan
Altman Weil, Inc.
(610) 886-2038
bbrennan@altmanweil.com

Go to Altman Weil MergerLine to view the complete list of 2009 law firm mergers. 

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