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Herbert Smith and Australian firm Freehills are set to merge to create an £800m firm after receiving the go-ahead from partners today.
Herbert Smith’s partner vote was done by secret ballot and had been going on for about 10 days, with votes being counted today, while Freehills’ partners voted at a meeting earlier today.
According to Herbert Smith partners voted “overwhelmingly in favour” of the merger. Herbert Smith required 75 per cent approval from partners while Freehills required 85 per cent. The combination, which will be called Herbert Smith Freehills, is still subject to regulatory approval and is penned to launch on 1 October.
The two firms will fully financially integrate and share a single profit pool, as revealed by The Lawyer last week (21 June 2012), but Herbert Smith managing partner David Willis declined to comment on the proposed remuneration structure and how profits would be split. Based on Herbert Smith’s turnover for 2011-12 and Freehills’ 2010-11 turnover, a merged firm would have revenue of around £826m.
David Willis and Freehills managing partner Gavin Bell will lead the merged firm as joint CEOs. The enlarged entity will have 2,800 lawyers, including 460 partners, across 20 offices in Europe, Asia and the Middle East. Willis said that the two firms had been in serious discussions about a merger for around six months, but exploratory talks had been going on for longer than that.
In a statement, Willis said: “We’re excited about bringing together two pre-eminent law firms to create a new and distinctive global law firm. We share with Freehills a strong belief that over the next few years the market for premium legal services will become increasingly dominated by a small number of truly global firms. This merger will therefore put us in a strong position to provide clients with the single global offering they increasingly demand.”
Bell added: “The merger will give Herbert Smith Freehills the platform to become the leading global law firm across Asia Pacific, a region likely to see continued substantial growth and to become an increasingly important part of the global legal services market. Establishing from day one a single, integrated firm will give all partners the incentive to work together toward a set of shared goals and ensure a seamless service to clients.”
The Lawyer first reported that Herbert Smith was looking at a merger in Australia in May 2011 (16 May 2011).