Have you heard the latest news in the whole United Kingdom regarding the law firms merging process?
According to the latest news regarding the above topic, many mergers are now used to expand a firm’s offerings. Aside from the fact that law firms in United Kingdom is widely being recognised and is expanding so fast this year, the UK law firms are now in the plan for merging for growth instead of financial necessity kind of reason.
According to the research evidencing the said news, there are numbers of decline for all the mergers just last year 2014. What will be the outcome of the law firm merging this year? Could it become worse than last year’s merging process?
By the opening of the year 2015, there are law firms who involves in merger activity in the whole United Kingdom that declines by or about eleven (11) percent just before the year 2014 has ended.
So, with that said, it is much higher than expected compared with 196 declines with the previous year 2014. Last year, they saw only 174 law firm mergers that have completed the merger activity.
Firms that went down the aisle in 2014 included private client specialists Speechly Bircham and Charles Russell, Scottish firm Dundas & Wilson, global top 10 firm CMS Cameron McKenna, top 50 firms Wragge & Co and Lawrence Graham and top 100 firms Blake Lapthorn and Morgan Cole.
What would be the possible reason or reasons behind the elevation of the merger activity? Here are some of the thoughts that we have gathered:
Law Firm versus Financial Pressures
The law firms are not new in this kind of issue. Even smaller businesses and bigger ones are experiencing financial pressure as well. According to the finance provider LDF in which there are the ones who produced the research for the public to know, there are many law firms who have joined forces with the others during the recession to offset financial pressures.
Aside from that, they have also talked about pooling resources and expertise and also allowing significant economies of scale against financial pressures.
With that kind of action, investment in property, support staffs, IT as well as the marketing part can be share and can be part of the quickly cutting expenditure.
According to the LDF (Left Democratic Front), if you don’t know about them, they are the coalition of left leaning political parties; they issued a statement that the economic recovery means that M&A is now in the verge of increasingly being used by law firms as part of their growth strategies.
As of this year, many merges are now being used as a means to expand service offerings. Aside from that, they are also used to explore new markets and extend geographical reach for the whole UK.
Law Firm Expansion
According to Peter Alderson, the managing director at LDF, he feels that law firms should feel that they are viewed as subscale and are very keen to expand. With the help of the recovering fees, law firm partners are getting more ambitious and are looking to serve bigger clients in a wider range of sectors and even in geographies.
The quickest way of achieving that ambition is to merge with a firm that already understands that market and has an existing pipeline of work.
What do you think about the latest issue in law firm financial and expansion experience? Should the public be in deep thought about this? Comment us below and we’ll discuss all your answers in the next topic!