Norton Rose seals $1.9bn merger with America's Fulbright & Jaworski

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  • You have got to admire how NR have seemingly taken over the world through a series of mergers, setting the trend for others to follow. They may have got it through but now the real hard work begins, ie, finding the Fulbright partners desks in London, perhaps they could take some of the spare room Lawrence Graham has on offer, they're only next door.

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  • Two Stones frantically grabbing hold of each other in the hope that neither will sink?
    Although both have their bright spots, neither is a serious player and the fact they're not merging (it's a DLA style verein with no shared financials/profits) suggests neither has sufficient confidence in the other to go "all in".

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  • Hats off. While other firms have agonised, kvetched, denied, coyly admitted, overegged and otherwise talked too much about their future strategy, Norton Rose has got on and and done it. Consequently, we have a guaranteed upper second tier stalwart of tomorrow's global legal market (better than that in areas such as asset finance and energy), who will have stolen a march of years, in some cases, over their rivals from around the Silver Circle. Difficult not to be impressed by this.

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  • Now that is what I call a merger that will make a difference!

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  • @ anonymous 2.30p "neither is a serious player".
    So you're saying neither NR, Fulbright or the combo is a serious players in energy, mining, infra, financial institutions etc!?
    COME ONE.

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  • NR are marketing this as a merger, but it's in the end no different from an alliance like CMS. An exclusive alliance with a US firm is a step forward, but let's not pretend it's a merger. Unless you align financial interests of the partners it's not one firm. That's why KPMG (which had this model up until recently) decided to merge some of the important country practices.
    In sum. It's not as integrated as Baker & McKenzie, and that really is not saying a lot, is it...

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  • The winners in the future legal market appear to be shaping up as:
    1. Magic Circle/White Shoe, who can say, "we are the best". Their 'niche' or perhaps better described as 'space' is the very top end clients and transactions.
    2. Global Service Firms which start to look like the big 4 accountants. DLA Piper, K&L Gates, now Norton Rose. For international clients whose transactions are 'only' in the £100's of millions in deal value, the proposition that "we can do everything which you the client do, everywhere you do it" is a compelling pitch. NR's project lawyers in Perth should be cross-selling their capital markets capability in Toronto and London, and vice versa, and that is frankly a scary thought for their competitors in the natural resources space.

    3. True niche firms/offices/teams. Recall at one point Proskauer Rose (?) saying something along the lines of, in London we're going to do funds work, and in London funds work we're going to be bigger than our Magic Circle competitors. A firm or office which can achieve a position like that has a compelling pitch to a client in the relevant space.

    For the rest, the world is looking bleaker. There must be at least 20 odd mid-market full service firms that, as hard as they try, don't look any different to each other from a client's perspective. There are then perhaps 50+ other firms/offices which can do much of what the mid-market full service firms can do equally as well as they can. We all have pretty much the same overheads, the same access to practicallaw.com, loan market association etc. and other know-how, the same back office support, etc. So not only do these firms look the same from the outside in, in reality they are in fact pretty much indistiguisable.

    Partners in the bleak middle are left to build personal relationships backed by an 'ok brand'. Clients become personal clients and a true 'following' should the Partner cross the street. This is a terrible long term business model.

    In summary, Norton Rose, and DLA Piper and K&L Gates for that matter, should be applauded for leading the changing shape of the legal market. Other firms which were the natural competitors 10 years ago of their constituent/legacy firms, and which have not been so bold, are much more likely to fail than they are.

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  • Fair play to NR. Fulbright have a great brand in the US and NR are Global and on the Up. Wi this remove them from the chasing pack into the global elite....it ought to. Those indicating that mergers are only mergers if you share all profits don't understand the big 4 and how they have become unassailable yet had to run multiple partnerships for tax, regulation but also remuneration reasons. How long before there's a big global 4 or 6 law firms of which NR be one? Not long I should wager. Good luck to them

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  • "is a serious players in energy, mining, infra, financial institutions etc!?"
    I think the original comment started with "Although they both have their bright spots...."
    F&J is a second tier energy firm (if it were first tier, it wouldn't need to merge with a second tier firm). NR does low value mining, infra and is unheard of in FI. So by world standards, they're not serious players and I don't think eg Rio Tinto will be picking up the phone next time it's thinking of doing a deal.

    In fact, if I was GC of Rio, I would be even less likely to use either firm because of who each of them has chosen as a verein co-member. If this was the test of a good firm, Baker and McKenzie and DLA would dominate world legal services.

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  • You may want to look at RTZ's GC speed dial the next time you are in his office.

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  • He might want to check the speed dial of the GC of HSBC too....

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  • RTZ no longer exists - it was bought by CRA and became Rio Tinto in the 90's. Hopefully NR aren't still waiting for the GC of RTZ to call. I think the GC of HSBC might have a few other names on speed dial that he/she would use first for a deal. CC's comes to mind....

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  • Not to mention BHP Billiton, BNP Paibas etc.., etc..,

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  • NR got that call from Rio and others and FJ is far from second tier energy

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  • Ugh. Another frankenfirm, joining the ranks of:

    -- Sonnenschein Nath Rosenthal Denton Wilde Sapte Salans Hertzfeld Heilbronn Fraser Milner Casgrain

    -- Kirkpatrick Lockhart Nicholson Graham Preston Gates Ellis Bell Boyd Lloyd

    -- Bingham Dana Gould McCutchen Doyle Brown Enerson Swidler Berlin Shereff Friedman

    -- Hogan Hartson Lovell White Durrant

    -- Bryan Cave Robinson Silverman Pearce Aronsohn Berman Powell Goldstein Frazer Murphy Holme Roberts Owen

    -- Squire Sanders Hammonds

    -- Pillsbury Madison Sutro Cushman Darby Cushman Winthrop Stimson Putnam Roberts Shaw Pittman Potts Trowbridge

    -- DLA Piper Marbury Rudnick Wolf Gray Cary Ware Friendenrich

    -- Wilmer Cutler Pickering Hale Dorr

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  • "...with Norton Rose turning over $1.32m in 2011-12,". Heh

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  • And that of the GC of Barclays, RBS etc. If anything NR is big in FI.

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  • The person saying F & J are second tier energy and NR does low value mining etc obviously just doesn't know anything about the market. Re GC HSBC - remind me, who did HSBC's rights issue in 2009?? Wasn't it NR? Was it not the biggest rights issue of all time? Who is selling HSBC's Asian assets?

    Whose handling the major disposals for BP in Europe at the moment? Freshfields? No - NR.

    Its probably already the best energy and mining firm in the world and with F & J it will just cement that.

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  • Quite amusing seeing how second tier firms try to Big Themselves and love the Frankenfirm description. Very apt, although difficult to top Dentons for innapprooriate mixing of body parts.
    No question NR are second tier in mining. |Despite claiming to act for Rio and BHP (neither company would allow a major advisor to work for the other), it's noticable that Rio use Links/Allens (or Herbies) for their major deals and BHP use S&M/Blakes (now Ashursts). So, despite have a few extra body parts, the quality of the verein members will not change and NRF will remain firmly in the second tier, even for mining.
    Good luck to them, though, and hopefully this exclusive referal verein arrangement will increase their revenue line, even if it reduces (to 1) the number of US firms that will work with NR now.

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  • Frankenfirm - a description which you could also apply to many other major market players:
    - Freshfields Deringer Tessin Herrmann Sedemund Bruckhaus Westrick Heller Löber
    - Coward Chance Clifford Turner Pünder Volhard Weber Axster Roger Wells
    - Linklaters Paines Rädler Raupach Oppenhoff & Rädler (though Oppenhoff later moved on again!)
    it's a rare beast that has grown entirely through organic expansion.

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  • Re Links/CC/Freshfields there is some truth that they also grew by merger - but they are merged firms, not Vereins, and there is a crucial difference - they make MONEY. This stupid cheerleading for firms that just bolt bits together to achieve size in number of lawyers and a gross turnover. McDonalds has a lot of restaurants - but they sell cheap food. NR and F&J are not succesful law firms when you measure their profit against other Global 100 law firms, a PEP of $750,000 puts you at the bottom of the heap. These firms are always going to be at the mercy of the truly succesful firms - Skadden, Links, Davis, Cleary, Freshfields, Latham, A&O, Kirkland, Simpson...even mid tier firms like W&C, Sidley, Macfarlanes, Herbert Smith,Proskauer, MoFo, Travers, Hogan Lovells, Greenberg, V&E, Baker Botts are TWICE as profitable and firms the next level down are still 30% more profitable than Norton Rose, so stick it all together and what do you have -a big trailing franchise - is that Burger King?

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  • The partners in this town really must not have much work to do if all they can do is argue about their competitors.

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