Law firm mergers and acquisitions got off to a blistering pace in the first quarter of 2017 with 28 combinations announced in the U.S., according to Altman Weil MergerLine.
The quarter’s deals included the merger of two AmLaw law firms, five cross-border combinations, and numerous acquisitions of small U.S. firms.
Altman Weil principal Tom Clay says the law firm merger market really “has three distinct tracks right now.”
“There’s an extremely active and competitive market for small law firms, with acquirers of all sizes in the hunt,” he said. “There’s a growing interest in overseas expansion that is almost
exclusively the province of very large law firms. And, there are infrequent but important large mergers that are potential game changers for the two firms and can directly impact the competitive landscape.”
The largest deal of the quarter was the announced combination of Norton Rose Fulbright, a global law firm with 3,700 lawyers, and Chadbourne & Parke, a New York-based, 300-lawyer law firm.
Combinations like these are rare. Between 2007 and 2016 there were only ten acquisitions of U.S. law firms with 300 or more lawyers, and only two of those involved prized New York City based firms.
There were five cross-border acquisitions in the first quarter — all made by mega-firms with over 1,000 lawyers.
The number of cross-border deals has increased in each of the last three years, reaching a record-high of eleven for the year in 2016.
DLA Piper announced two sizeable international deals in the quarter, annexing 150-lawyer Danish firm LETT in Copenhagen, and 50-lawyer Portuguese firm ABBC in Lisbon.
Dentons also made two international acquisitions, entering the Netherlands with the acquisition of 70-lawyer Boekel in Amsterdam, and expanding in Mexico by acquiring five-lawyer, Monterrey firm Canales Zambrano.
Norton Rose Fulbright added four lawyers in Cape Town, South Africa with Keller Snyman Schelhase.
Small acquisitions of firms with twenty or fewer lawyers accounted for 85.7 percent of all combinations in the first quarter of 2017.
For these deals, acquirers’ primary focus was the Middle Atlantic and Southern states, with New York as the top in-bound destination.
Two AmLaw firms made small U.S. acquisitions in the quarter. Squire Patton Boggs acquired four-lawyer IP boutique Fernando & Partners in Palo Alto.
Smith Gambrell added seven-lawyer Balber Pickard in New York City.
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