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Ten years on people still talk of the merger that gave birth to Clifford Chance as the archetypal merger. It was, they say, the one big merger that really worked.
But Geoffrey Howe, who was elected managing partner of Clifford Chance 18 months after the deal and had to unite the two firms and develop their international strategy, made clear that it was by no means trauma free.
His experiences, related at a conference called "Merger Most Foul" last week, should give pause for thought to all those other firms in merger talks.
He identified five key problems or negative aspects of the merger.
There were clashes between people from each firm, Clifford Turner and Coward Chance, where the practice areas were similar. "People stake out their turf," said Howe. "That's where we had problems."
Although it merged in 1987, the firm had to operate from separate premises until 1991 when the new building at Aldersgate was ready. "It's crucial to get people mixing in the same building as soon as possible...we tried to merge practice groups into the different buildings" but then, he said, the battle lines seemed to fall between the different buildings rather than between the two firms.
An expensive, time-consuming row over IT. One firm had mainframe-based IT, the other had PCs on each desk and each fought for its own system. "In the end we were reduced to the expedient of calling in a consultant," said Howe. But the consultant found out who were the most powerful people and tried to do what they wanted, he said. The firm had to bring in a second consultant who finally recommended that the mainframe should go.
There were no economies of scale and some "diseconomies of scale" because, said Howe, "there was the temptation to grow the administration as we got bigger".
The final point was the feeling that the old culture, traditions and way of doing things were being destroyed. But Howe seemed to believe that this was outweighed by what he called the "liberating effect" of becoming a new firm.
Howe revealed that luck played a large part. "There was a bull market running in 1987 which meant we had a honeymoon period of two years when there was more money, people were feeling positive and they were able to attribute some of that to our merger."
His comments were backed up by Michael Simmons, who at one stage had been the senior partner of Malkin Janner which demerged only a few months after merging.
"The economy was down," said Simmons. "There was less money in people's pockets and they started rattling the cage. They blamed the merger."
Howe also produced his six-point recipe for a successful merger: good quality business analysis to ensure you know exactly what your strategy is before a merger; very good research and due diligence on your merger partner so that there are no surprises after the event; good quality management before the merger, that is ego-free; a good business environment in which to do the merger; the right "people chemistry"; and be lucky.