The Impact of Law Firm Mergers on the Business of Law

• Pages: 28-29
• Date: 01 January 2024
• Author: Daniel S. Wittenberg
• Subject Matter: Derecho Civil

In the ever-evolving landscape of the legal industry, law

rm mergers have become a prevalent phenomenon.

These mergers, often driven by strategic considerations

and market forces, can have profound effects on the

business of law. From reshaping the competitive land-

scape to changing the way legal services are delivered and con-

sumed, law rm mergers have ripple effects that touch every

corner of the legal profession.

By the Numbe rs

Law rm mergers are up year-to-date in 2023 compared with

2022, according to data compiled by Fairfax Associates. More

law rm mergers were completed in the rst half of 2023 than

in the same period in 2022 or 2021. The largest completed

merger in the second quarter was the formation of Maynard

Nexsen from two southern rms—Birmingham-based

Maynard Cooper & Gale (286 lawyers) and Columbia, South

Carolina–based Nexsen Pruet (175 lawyers). “Merger activity

is increasing out of the pandemic, though it’s been a bit slower

than we thought we’d see given the high level of interest and

active discussions we’ve seen around mergers,” observed

Fairfax Associates’ principal, Kristin Stark, Irvine, CA, in The

American Lawyer.

According to Fairfax Associates, law rms completed 11

mergers in the third quarter for a total of 41 in the rst nine

months of 2023. Activity is being driven by rms looking to

develop a coast-to-coast presence, with California serving

as a particularly hot expansion target. “California remains

a growth focus…. It has very mature markets. While it has

a lot of growth potential, it also has a lot of small rms that

are combining because they’re facing succession issues,” noted

Stark. Philadelphia-based Saul Ewing (351 lawyers) combined

with Freeman Freeman & Smiley (50 lawyers) in Los Angeles

and Orange County, as their rst foray into California in the

largest merger of the quarter.

The substantial forthcoming merger between Allen & Overy

and Shearman & Sterling announced in the second quarter

cannot be ignored. It will result in rm of almost 4,000 attor-

neys, and the merger is expected to close in May 2024. Allen

& Overy and Shearman, through their merger, would surpass

the $3 billion threshold if both rms together collect the same

amount of revenue they brought in separately during 2022,

based on The American Lawyer data.

Competitive Adva ntage, Ecie ncy, and

Client Service

Mergers have multifaceted impacts on law rms and how

they reshape the business of law. One of the most noticeable

effects of law rm mergers is the consolidation of legal service

providers. As law rms combine their resources, expertise,

and client bases, they create larger, more formidable entities

that can compete more effectively in today’s globalized legal

marketplace. This consolidation is driven by a desire to gain a

competitive advantage, both in terms of market share and spe-

cialization.

The legal needs of clients often span multiple jurisdictions.

A client with business operations in various states or coun-

tries requires legal advice and representation that can navigate

complex regulatory environments. Law rm mergers provide

a pathway to geographic expansion, allowing rms to serve

The Impact of Law Firm Mergers on

the Business of Law

By Daniel S. Witt enberg, Litigation News Associ ate Editor

© Getty Image s

WINTER 2024 • VO L. 49 NO. 2

28 | ABA LITIGATION SECTIO N

Published i n Litigation News Vo lume 49, Numbe r 2, Winter 2024. © 2 024 by the Americ an Bar Assoc iation. Repro duced with perm ission. All r ights reser ved. This infor mation or any por tion thereof

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BUSINESS OF LAW