Leading Australian practice the Allens Arthur Robinson Group is considering merging.
The 186-partner group consists of Allen Allen & Hemsley, Arthur Robinson & Hedderwicks and Finlaysons.
Sources within the firm say that a full merger between Sydney-based Allen Allen & Hemsley and Melbourne-based Arthur Robinson & Hedderwicks is a possibility.
The latest firm to merge its national offices was Freehill Hollingdale & Page (The Lawyer, 21 February). The Allens group is currently the only top 10 firm not to have fully merged.
But despite pressure to provide integrated national coverage, the Allens group has always been against a full merger.
A senior Australian lawyer says: "They have always operated independently because they had too many conflicts and for that reason had always been against a merger."
Conflict is a major issue for the group, as both firms often act on the same deal but as opposing counsel.
But an insider believes that clients would be willing to deal with conflict issues in return for integrated national coverage: "I am sure they want to be national as everyone else does. It is a case of short-term pain for long-term gain."
Arthur Robinson & Hedderwicks managing partner Tom Poulton confirms that a merger is now a serious option for the group.
He adds: "We consider our position from time to time and we are happy in our alliance. But by the same token, we are the only firm in the top 10 that will be operating on a federated structure as of 1 July."
He concedes that should integration occur, the firms will no longer be able to act on the different sides of the same deal: "That would be revenue out the door, there is no doubt about that, but we would more than expect it."
The merger of the 95-partner Allen Allen & Hemsley with Arthur Robinson & Hedderwicks would create a 168-partner practice.