United Kingdom
More than one third of Top 100 Law Firms expect to merge in the next three years - Benjamin Viney
The legal sector is facing a period of rapid change. The Legal Services Act has come into force and there is widespread expectation of continued consolidation amongst law firms.
BDO recently undertook a short survey of more than 100 law firms to further explore attitudes towards mergers and acquisitions, and a selection of the findings are set out below:
- Almost 60% of survey participants expect to engage in M&A activity in the next three years, and almost one third expect it in the next 12 months.
- Finding the right firm to merge with is cited by over three quarters of firms as a key concern.
- 40% of participants believe that they do not have enough senior people to successfully effect their growth aspirations.
- 34% of firms could envisage merging with another professional services firm outside of the legal sector in the next three years.
There are many different reasons for undertaking a merger, including gaining access to new markets, increasing firm profitability, expanding the range of services provided, paving the way for partner retirement etc. It is vital that partners are collectively clear what the reasons for seeking a merger actually are, and what the associated implications will be.
Whilst each firm will have its own particular requirements when considering a merger the biggest challenge is often about ensuring a good cultural ‘fit’. The starting point then, is in having a clear understanding of your existing culture and then exploring the extent to which a potential merger partner’s culture is likely to be consistent with your own.
If you would like a full copy of the findings please email me: benjamin.viney@bdo.co.uk
June 2012