David Harris had his quip all ready at last year’s press party celebrating Lovells’ merger with Hogan & Hartson. “I know this looks like a coalition,” he said, “but neither of us is the Nick Clegg in this relationship.”
Luckily, Harris does not have to draw on the nation’s emergency supplies of Schadenfreude.
A year on from the euphoria of doing the deal the combination is still seen by most as a rare example of a merger of equals. That’s some PR triumph, because the US accounts for 46 per cent of global revenue, with Continental Europe and London contributing a neat 24 per cent each.
Asia is the minnow, representing just 6 per cent of turnover, so let’s describe that politely as Hogan Lovells’ growth challenge. If it can’t use its transatlantic muscle to hike Asia, much of the rationale of the merger will disappear; the fact that Hogan Lovells is currently being linked with an Australian merger can only stoke that pyre.
Still, fair play to Harris for driving through the remuneration changes. There was always something of the Swiss about Lovells, with its institutionalised placidity and endless referenda on the minutiae of lockstep. Harris’s great achievement is to excise remuneration from partnershipdiscussions, although it took a transatlantic merger to do it.
The wider significance of the combination is to open up a new class of global firm outside the transatlantic elite. But the danger for Harris and co-managing partner Warren Gorrell is that they must now define that patch in a way that is not just about size or geographical spread. Norton Rose has already laid claim to membership, while CMS Cameron McKenna and Simmons & Simmons are both readying themselves.
The problem for Hogan Lovells is that it can’t bear to be classed with DLA Piper or Eversheds, neither of which are yet taken seriously enough by traditional City firms in terms of international credibility, but both of which are pitching for many of the same multinational clients. If Lovells went through an apparently transformative merger only to end up in the same place as DLA Piper, Harris will need to practise articulating what makes Hogan Lovells so very different. (See feature, page 16.)