The ongoing consolidation of the legal services sector continues apace and is only likely to accelerate. It has been driven in large part by the liberalisation and deregulation of the market. This in turn has led to the emergence of new entrants and new business models. There’s the pressures of the ongoing overhang from global financial crisis and the shift in the balance of power from supplier (law firm) to consumer (clients). Add to that new technologies, increasing regulatory and compliance burdens and the actual and threatened changes in the Personal Injury sector. It’s no surprise that law firm mergers are being considered by thousands of firms. In deed it is difficult to find a firm who does not have it on their radar.
To be clear, ‘merger’ here is used as a generic term which embraces true mergers (where two organisations are similar in size, which is the rarest kind). It also covers acquisitions by a larger firm of a smaller firm, disposals of a business to an acquirer, and bolt-ons of teams, departments or practice areas or offices.
It’s not unusual for law firms and their busy management teams to try and work through the merger process themselves. But that process of working out what you are aiming for, identifying and evaluating targets, arranging and holding initial discussions, establishing what funding may be required, what structures will be needed, ascertaining cultural ‘fit’, cracking the ‘deal-breakers’, negotiating terms and completing the deal takes up an enormous amount of management time – and energy. And that’s before the real work starts – on planning the integration and success of the new business!
The lack of independence and objectivity doesn’t help on the big issues such as ‘who gets what’, for example. Sometimes all that is required is an impartial ‘honest-broker’ to facilitate discussions and help resolve issues. Often, the firm aiming to grow by merger or acquisition, or the firm seeking to be acquired, would benefit from the assistance of an experienced professional. Often this is as Lead Advisor – to guide them through the entirety of the merger process. We work with you in the way you want, be that on a joint-appointment, to help resolve a single issue, or as lead advisor for one of the parties throughout the process.
We are also Founder Members of the Association of Law Firm Merger Advisers.
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