Herbert Smith abandons European alliance after merger knockback
Herbert Smith is set to end its alliance with German firm Gleiss Lutz and Benelux firm Stibbe after the European outfits voted against a merger.
Jonathan Scott
Herbert Smith has confirmed that it will be giving notice to leave the alliance with Gleiss and Stibbe in order to pursue its objective of building a fully integrated European and global capability.
Herbies said it would be handing in its notice to leave the alliance with the firms.
Senior partner Jonathan Scott said: “Our clients increasingly look to Herbert Smith to provide advice and support across all their markets, so our strategic goal has to be to develop a strong and integrated global platform.
“Securing clarity from our alliance partners on whether they wanted the opportunity of a merger to join us in building this platform was a necessary first step in the process. They’ve made their decisions. We’re now firmly in control of our international expansion and are pressing ahead with our plans to achieve this.
“We have the utmost respect for our alliance partners and look forward to maintaining the good relationships we have developed with colleagues at Gleiss Lutz and Stibbe over the years.”
Gleiss and Stibbe voted earlier this week not to merge with Herbert Smith after being the City firm’s alliance partners for the best part of a decade (22 November 2011).
In a joint statement Stibbe Brussels managing partner Jan Peeters and Amsterdam managing partner Heleen Kersten said it would consider working with Herbert Smith and Gleiss “if the alliance is terminated”, adding that it would also work with “other top-tier firms if they would better fit the client or matter”.
“During the last two months, Stibbe has considered Herbert Smith’s request to begin merger talks. We’ve decided not to change our current course,” they added.
“Stibbe is maintaining its independence in accordance with its strategic objective of being the leading internationally oriented law firm in the Benelux region. Stibbe will continue to offer its clients international access to its network of top-tier best friends firms abroad, including those in America, Europe or elsewhere.”
Rainer Loges, managing partner of Gleiss, said the firm regretted Herbert Smith’s decision but added it did not come entirely as a surprise after last weekend’s vote.
“Internationally, Gleiss Lutz remains well positioned,” added Loges. “We’ve built an unsurpassed, strong and tested international network with leading law firms and lawyers across the globe. Herbert Smith and Stibbe have always been part of this network. Gleiss Lutz has, however, also always relied on numerous other relationships throughout the world. We’ve always worked with the firms most suitable for our clients’ needs and will continue to do so.”
Earlier today the firm anounced that is has named new heads of Asia and Asia dispute resolution (24 November 2011).
Readers' comments (8)
mary | 24-Nov-2011 11:38 am
Oh my god, Herbies is up a creek.... The idea that it will "build a fully integrated European and global capability" is laughable. How, exactly, does it propose to do this? What does it have in Europe to integrate?
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Ami de Chapeaurouge | 24-Nov-2011 12:03 pm
The German market's attiude has shifted from "Going under the Umbrella" in 2000 onwards to "Staying Independent" in 2011 for plausible reasons. Alongside U.S. law whose influence is waning due to overreaching and plays still a significant role in Latin America via Miami and NY City, UK law has grown tremendously in importance in the Middle East and Asia; yet unnoticed by the many, German legal doctrine and statutory law-making experience is holding its ground in CEE, CIS, Japan and other parts of the world as an emerging third force. In addition, most of us are quite familar with certain doctrinal developments in the U.S. and the U.K. in our precedent and file systems so that we can hold our mettle across the table and in pitches.
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Herbie's taken quite some strides, particularly in Asia, to reach the upper echelons of the profession and together with Ashurst and in banking and finance, at times overlooked, Denton in London, are fabulous U.K. allies to turn to for other German firms. Under Wegen's stewardship, Gleiss Lutz know a thing or two about the NY market, but if wisdom prevails, Herbies remains an important chess piece in Gleiss' cross-border aspirations.
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Anonymous | 24-Nov-2011 1:50 pm
Cher Ami, how can "Herbies remain an important chess piece in Gleiss' cross-border aspirations" when they just ditched the alliance? If this is chess then Gleiss have sacrificed what was (at best) a rook: peripheral on the board and only capable of moving and thinking in two dimensions.
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Mark Brandon | 24-Nov-2011 2:17 pm
@Ami, would love to see your evidence for the 'waning' of US influence.
As Cicero remarked "infinite money is the sinews of war", and US firms have access to money in a way that firms in other jurisdictions cannot hope to match. Litigation alone pours $300bn annually into the system.
Sans mergers, Herbert Smith will find the road to building a credible global platform impossibly expensive, even if it is attainable. It will be a bleak road ahead.
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Anonymous | 24-Nov-2011 2:22 pm
Herbert Smith is now far behind what were/what it likes to consider as its peers as a result of its managements complete failure to think strategically in recent years.
It now needs to take a leaf out of Norton Rose's playbook and be bold, or it will quickly end up in an SJ Berwin style morass.
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Anonymous | 24-Nov-2011 2:53 pm
Any colour on how PEP at Herbert Smith and Stibbe (Belgium) compare? Wouldn't Stibbe need to de-equitise one in two partners to get anywhere near Herbert Smith's PEP?
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Anonymous | 24-Nov-2011 5:59 pm
Growing organically in Germany will be difficult, as it has been in Spain; possibly easier in Benelex, given the fragmented market. The question is, which firm will HS merge with - or take a significant team from - to create the critical mass it will need? There are not too many candiates.
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Bored | 25-Nov-2011 1:03 am
Stop teasing us. Give us an article about that Herbert Smith - Clayton Utz merger. We all know that there's some sort of announcement due out soon.
PS - That picture of Scottie is frightening. He looks like the Joker!
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