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UK law firms 'set for merger mania'

Posted by: Laurence Simons 04/02/15

There is a widespread expectation that many top UK law firms will merge in the next two years. Law firms across the UK could be set for a bout of merger mania in the next couple of years, new research has indicated.

A study by legal communications specialists Byfield Consultancy and partnership law experts Fox Williams has found 95 per cent of managing partners at leading law firms believe there will be widespread consolidation among the elite firms.

The study consulted management at 102 of the top 200 firms and found the motives for such amalgamations included the strength of competition, the expectations of clients, growth needs and the reputational boost mergers can provide.

Indeed, 45 per cent of those firms who had yet to merge with another said they would consider doing so inside the next two years.

However, there was a significant divergence in opinion that suggests many firms will stubbornly stay single rather than being married off with a rival. While 43 per cent of merged firms said the majority of such moves over the past five years had gone well, 49 per cent of those who had not merged believed such transactions had not been a success.

Byfield discussed mergers with the analogies of marriage and dating, although it is clear there have been variations to the extent to which chaperones have been used. Only six per cent took advice on mergers from external lawyers, while 30 per cent of non-merged firms would consider this step if they were to amalgamate with another.

Of course, there may be other considerations in all this. For some, mergers might mean job losses in areas of otherwise duplicated function. 

Another horror, of course, is the prospect that merging might mean an office move. All that having to clear out old junk, the possible loss of the nice desk by the window and the fact that the best sandwich shop in town is no longer next door may all be a major shock. As with real marriages, there will always be some tricky adjustments when change comes about.