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23 February 2009
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20 February 2012
Indian firm Amarchand & Mangaldas & Suresh A Shroff & Co has taken the unusual step of converting to a full lockstep model after years of maintaining tight reins on its equity.
Amarchand currently operates an eat-what-you-kill system, whereby a small number of founding partners and family members are understood to command a large proportion of the equity.
Managing partner Cyril Shroff (pictured) believes using a more meritocratic system will give the firm an “acquisition currency” that will allow it to grow “massively”.
He said: “We wanted to create a more broad-based partnership. The benefits of lockstep are well-known, and ;collegiality ;and sustainability were what we were looking for.”
The restructuring is expected to finish by the end of March.
Amarchand has 450 associates and 40 partners, 15 of whom are in the equity.
Anonymous | 24-Feb-2009 12:34 pm
Amarchand has chosen independenceInterestingly, Amarchand and AZB, the two main rivals, have chosen diametrically opposite paths. Some years from now, when the market opens, AZB would have most probably merged into Clifford Chance, lost half its partners and would be a thing of the past. Only some partners such as the name partners and a few others will be absorbed into CC. Amarchand on the other hand, by choosing lock step, has ensured its independence and durable identity. Of course, lock step is not easy but it is a lot better than loosing one identity. A very smart and astute move by the shroffs. Well done!!
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Anonymous | 24-Feb-2009 12:38 pm
good deal for younger partnersWhen I compare the choices made by some of the star younger partners who stayed behind to work with Amarchand and those that moved to foreign firms, its very clear that the former have got the better deal in life considering whats happening in London and the positive changes within Amarchand. Despite all the criticism about being a so called ‘family firm’, it is Amarchand and the shroffs who have consistently for the last many decades changed the paradigm and moved the industry forward. The others have only followed. This is a tremendous development for younger lawyers who want to work with independent firms.
Anonymous | 24-Feb-2009 12:43 pm
lock step can be dangerousClearly the shroffs have been generous in moving to lock step, but we hope they know what they are doing. Lock step is now a much discredited system and is actually more severe and brutal than performance based systems. Neither asia nor India nor Amarchand or any other Indian firm are remotely ready for a pure lockstep. A lock step and a two tier partnership are fundamentally inconsistent. I can bet my next months salary that they will be reversing the pure lockstep within a few years and move to a modified lockstep with more performance and bonus. This is just not sustainable and seems like a gimmick, or a very foolish move. Nonetheless, our compliments.
Anonymous | 24-Feb-2009 12:51 pm
Wake up AZB!!!!!!!For younger lawyers and partners, independent law firms are always the better bet, especially in Asia. Surrendering one’s independence through alliances and mergers is the shorter and less courageous route. AZB has an even higher concentration of equity than Amarchand, though this is less publicized. Clearly, neither Zia nor Ajay are in a mood to share the booty with younger partners who make alotta money for them. By trying to sell out to foreign firms the named partners will protect their future but shaft the younger generation without their realizing it. Zia, are you moving to lock step?? Or, still going to take the lioness’ share home?
Anonymous | 24-Feb-2009 12:57 pm
LockstepWe knew about this for a while. since the firm announced it last year. we only want to see it implemented asap and in totality and at high standards. not all those partners considered for lockstep are really lockstep material. Mr Shroff, a bit more quality control please?! If we are to believe in this and choose you over foreign firms. nonetheless, good move!
Anonymous | 25-Feb-2009 10:08 am
mergers in the offing?In my view AMSS will benefit most from the economic slowdown in US, UK. The Indian lawyers who went there during the boom are returning home, and AMSS is still the place to work in India. So AMSS will get people who have worked in AMSS (thus who know about the AMSS culture) and who have in addition been trained by the foreign firms.If you read between the line, do we see prospect for some law firms mergers - "we want to grow massively"!?! A merger of AMSS with firms will Crawford, Mulla or Dua will create a big enough firm to dominate the domestic market even if the market opens for foreign firms.
Anonymous | 25-Feb-2009 1:58 pm
ChoicesHave 'star young partners' in Amarchand made a better choice in staying in Amarchand then in joining an international law firm? I don't know. I do know that a fair number of these 'star young partners' tried their best to move laterally to international law firms a few years back and failed spectacularly - I really could name names, but should not! Amarchand looks as divine to me right now, as does a government job with the Registrar of Companies. It offers comparative security, tea breaks and a stable environment, but little else. Give me risk with a more dynamic but professional outfit anytime. Really, its bad enough working for partners in a law firm, without having to work for the family in a family run law firm and compete with their kids! And the fact that commentators below speak about Amarchand and the Shroffs interchangeably or about "Amarchand and the Shroffs", speaks volumes about how much progress Amarchand has really made. Amarchand, with lock-step, other bells and whistles, et. al., remains a family run firm. Let a non family member become Managing Partner for a starter or the partnership deed be made a little more even handed - then Amarchand would have really gotten somewhere. Oh, and as a someone who knows Amarchand, I am guessing that the lock-step will fail. Amarchand simply does not have enough quality control (for the time being) for lock-step to work.
Anonymous | 25-Feb-2009 2:23 pm
ChoicesWhat I meant to say instead of the last two lines below: Oh, and as a someone who has worked at Indian law firms before, I wonder whether lock-step will work and whether firms in India will demonstrate enough quality control (for the time being) for lock-step to work!! Unfair of me to single out Amarchand - that would be too subjective a view to take and I have no basis on which to single Amarchand out!!
Anonymous | 25-Feb-2009 5:48 pm
Amarchand still has the best chanceDespite some of its drawbacks which may actually be its strengths, it still has the best chance by a long shot of being the sole dominant independent player. Just look at the rest. AZB has sold its soul. JSA has no leadership and functions as multiple firms. Mulla, Crawford, Little and Dua are ancient history. Luthra has no real depth and is just a marketing machine. Fox mandal is not even worth mentioned. Trilegal was decent but has become A&O. so what’s left?? So long as the family partners are self sustaining professionals, and contributing to the firm, it really makes no difference. At least, Amarchand will keep the Indian flag flying. No market should be without a national champion, and there is little doubt that this mantle belong solely to Amarchand. Noone is even close. If associates and young partners can work for foreign bosses, thousands of miles away, whats wrong with working for a talented family. As a former Amarchand lawyer, I see nothing wrong. Whatever I am today is because of the fabulous training I got in Amarchand. They still do the best work, and have the smartest talent.
GimmicksI completely agree with the comment that Amarchand's understanding of the lockstep model may be completely different from the understanding of the term internationally. This is not unusual in the Amarchand context as they tend to view things in the manner most advantageous to them. As an ex-Amarchand lawyer, who still has dealings with Amarchand, all I can say is little has changed in the firm and these sorts of steps are mere gimmicks with little substance. They are probably driven by the desire to get more attention from the legal press, given all the hype about AZB's best friends deal. Unless the family changes its mindset, which is difficult to imgaine, attempts to make Amarchand a better place for younger lawyers are unlikely to succeed.
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