Everyone has read about the big law firm mergers over the last few years. There have been a steady stream of big name, high profile firms merging with or taking over rivals. Sometimes this is client led, sometimes it is to get an international or global reach or to gain financial benefits through economies of scale.
It is not just leading City firms who have been on the acquisition trail though. In the last 12 months QED Legal has arranged over 20 meetings for legal practices looking to investigate a merger. These have included larger Legal 500 style practices, major national practices looking to open in more UK jurisdictions and smaller firms looking to merge to save money (with professional indemnity insurance usually dropping sharply at larger firms).
In addition we are seeing a distinct increase in instructions from practices who are seeking a solution to an ageing partnership. Law practices can’t just shut up shop when the time comes for the Partners to retire – they have the additional burden of satisfying the SRA that client matters have been properly concluded and things like Will banks have been properly dealt with. There is then the practical matter of where to store client files for the next 6 years (at least) and the often prohibitive expense of obtaining ‘run-off’ insurance. A merger with another local practice obviates the need for insurance, means clients have a proper handover and ultimately means that when the Partner(s) at the acquired firm retire they can do so without the hassle and stress they might have trying to close the practice down – it really can be a ‘win-win’ situation.