2 August 1999
16 December 2013
20 September 2013
9 December 2013
20 September 2013
9 December 2013
The North West's legal lonely hearts club just gets bigger by the day. Liverpool insurance giant Weightmans, and Manchester's personal injury specialist Donns Solicitors are just two of the firms who have been caught whispering sweet somethings into the ears of opponents, in the hope of striking a deep and financially meaningful relationship.
Meanwhile, half-competent partners in top firms can hardly walk past a court these days without strangers asking them how much they want to join a new, corporate, insolvency or property department? Davies Wallis Foyster alone has around 16 partners who have been approached about joining new firms in the past two years.
Claims of solicitors soliciting may bring angry scoffs and cries of media exaggeration from some north west lawyers. In fact, one senior partner in Manchester recently rang another firm in the city to apologise for a local news report linking the two firms in merger talks, and to say it was complete nonsense. He went on to add: "While I've got you on the phone, what do you think about the possibility of a merger."
The catalyst for these mergers - and poaching - in the North West legal market has its origins in the North East. The emergence of a dynamic legal market in Leeds in the early 1990s - North West solicitors tend to sniff and say it was all hype - had an impact on the profession in Manchester.
The cultural gulf between Yorkshiremen and Mancunians began to be bridged with the mergers that created the likes of Addleshaw Booth & Co and Dibb Lupton Alsop. At the same time, the thundering arrival of Hammond Suddards in Manchester, which quickly began to generate around £13m turnover, posed an immediate threat to well-established and well-heeled firms.
Some, such as the 225-year-old Slater Heelis, simply imploded. Locked into an 18th-century-style partnership agreement that was inflexible and incapable of dealing with non- performing or retirement-watching partners, the firm, which otherwise had good clients and an excellent reputation, broke up in November last year. Others such as Cobbetts, Halliwell Landau, Pannone & Partners and Davies Wallis Foyster found themselves in the shadow of Addleshaws, Dibbs, Eversheds and Hammonds as they flashed around their new "national" credentials.
Meanwhile, Liverpool's traditional strength in insurance work came under threat following a shake-up in the industry that saw panels reduced and firms such as Weightmans and Hill Dickinson questioning how to meet clients' changing needs.
Some firms now believe they have the answer, while others are floundering.
Cobbetts and Halliwell Landau are two firms which, after flirting with the idea of merging with each other, have taken different approaches, not just to surviving, but to thriving.
In the case of Halliwell, an aggressive "eat what you kill" policy has marked the so far successful reign of senior partner Roger Lancaster.
Halliwell's turnover is currently £13.3m, up from £6.3m three years ago. And in the past eight months it has taken on 65 staff.
A bullish Lancaster claims his firm is in the North West's premier legal league. "None of them give us fear or trepidation," he says unprompted.
The opening of a London office shows Halliwell is not afraid to venture where so many have fallen, although Lancaster says the firm has no ambitions to go national. "We don't actually believe that a national firm is the way forward," he comments. "We've concluded that the North West market is one where there is a great deal more growth for us."
Almost in the same breath, Lancaster admits he wants the London office to develop a legal life of its own rather than being just a service centre for the North West operation.
Across the road at Cobbetts, lawyers see the opening of new branches as an unwanted distraction. "The conscious decision that we took was that we were going to concentrate on key areas," says Cobbetts managing partner Michael Shaw. He cites intellectual technology, intellectual property and employment as areas the firm has targeted for growth.
"We do not have the distractions of trying to get other offices and resource other locations," says Shaw.
Like Halliwell, Cobbetts has enjoyed good growth, with a turnover of just less than £15m. Plus the arrival of nine partners from Slater Heelis has bolstered its staff.
On reflection, both firms are probably relieved they never merged, because while Halliwell might be expected to gorge on the entrails of its opponents, Cobbetts is more likely to offer them a chocolate croissant and coffee. But radically different cultures apart, both share a new apathetic attitude to future mergers.
And both have rejected approaches from Pinsent Curtis, which is desperate to gain a foothold in the North West. Each has made it clear they want to be the major force in any future merger.
Firms such as Liverpool insurance practice Weightmans, would more warmly welcome any merger proposition following the collapse of talks with London's Kennedys and the Yorkshire-based Jacksons last year. Weightmans senior litigation partner Ian Evans says the talks fell apart because the firm wanted a tripartite merger, which was impossible after Kennedys pulled out.
As yet, the firm has not held talks with anyone else.
Evans denies the failure to merge is an embarrassment. "I don't think we got our fingers burnt at all - we got to look at other players nationally," he says.
Last month's takeover of eight-partner Midlands insurance practice William Hatton, and the fact that the firm recently won a place on the Post Office panel, have strengthened morale, though Weightmans clearly has not given up on its plans to expand nationally. Its policy of "incremental growth" has led to the opening of a small Manchester office to act for police authorities. It is also looking to develop an employment law department. "We fought shy of entering Manchester because there were too many firms scrapping for work, but in the end we've given in to client demands," says Evans.
Such demands have seen Berrymans Lace Mawer and, more recently, Beachcroft Wansbroughs conclude that to be successful in the insurance market you need a national reach. Others such as Manchester's James Chapman & Co believe niche insurance work will continue to be profitable. "The larger firms will find it difficult to compete on price," says equity partner Sarah Grant. "I think the medium-sized firms will find it increasingly difficult to compete full stop."
Niche firms such as medical negligence practice Alexander Harris in Altrincham, and the Manchester commercial firm Chaffe Street, have been praised by their larger rivals, but that does not mean they will be left alone.
Addleshaws is already trying to get into the matrimonial and insurance sector. Meanwhile, firms such as James Chapman & Co face a strategy quandary if they were to lose a number of key clients, such as the Solicitors Indemnity Fund.
Berrymans Lace Mawer partner David Evans says: "It's not sensible in any business to have all your eggs in one basket."
Others such as Manchester firm Pannone & Partners have spread the legal risk across eight sectors - a strategy that is not wildly profitable, but highly successful and seemingly satisfying. The firm has not lost a partner since March 1995 .
Pannone & Partners - which is expected to have a £10.6m turnover this year - tried, and largely failed, to enter the London market in the early 1990s. It now seems happy simply to be a Manchester firm.
Managing partner Joy Kingsley is looking to expand the insolvency and business crime departments, as well as develop an intellectual property practice. She also has an eye on firms a tier below hers.
"The only sort of merger that would appeal to me would possibly be one of those smaller commercial practices. That's probably an area I'll look into over the next 12 months."
Kingsley's views are backed up by other local observers who believe it is the firms a tier below the Cobbetts and Panonnes that face a turbulent year. Firms such as Garretts and Halliwell are already poised to cherry-pick the best talent from smaller commercial practices.
The steady trickle of partners' CVs already landing on the desks of big firm senior partners is poised to turn into a stream.
As the bigger firms in the North West settle down with a strategy for the new millennium and niche firms concentrate on core clients, those in the middle face being squeezed uncomfortably on both sides.