Herbert Smith and Australia’s Freehills are pushing ahead with merger talks after The Lawyer first reported the pair were mulling discussions in December.
Herbert Smith management discussed whether to hold formal talks with Freehills in December (12 December 2011), and gave the negotiations the go-ahead. The decision came after London partner Greg Mulley, who is leading the firm’s push into Australia, held exploratory talks in Asia with Freehills and reported back to the partnership. Mulley is also understood to have spent time in Australia in the past two weeks.
According to one partner at an Australian firm, Freehills’ partners were also asked to vote on whether to pursue a merger in the closing months of 2011.
Talks between the two firms are still in early stages and an Australian lawyer based in the UK confirmed Herbert Smith was still keeping its lines of communication open with other firms.
Several market commentators, however, have said they would be surprised if Herbert Smith and Freehills hammered out anything more than a loose association. A partner from one of the big six Australian firms said that he did not understand the rationale behind the proposed tie-up deal between the two firms. He suggested Herbert Smith could be feeling left behind following the rush of UK firms into Australia, and noted that Freehills, which has only one office outside Australia in Singapore, could benefit from Herbert Smith’s existing Asia network.
At the end of 2011, Freehills had 980 lawyers, including almost 200 partners. It is the third largest law firm in Australia by lawyer headcount and the second largest by revenue. In the 2010-11 financial year, the firm pulled in A$511m (£346m).
The firm has offices in Sydney, Melbourne, Brisbane and Perth and a single international branch in Singapore.
Freehills also has a strategic alliance relationship with Beijing-based firm TransAsia Lawyers, and runs associated offices with Indonesian firm Soemadipradja & Taher in Jakarta and Vietnamese firm Frasers Law Company in Hanoi and Ho Chi Minh City.