Freshfields Bruckhaus Deringer has announced it is planning to merge its offices in Cologne and Düsseldorf in the medium term in order to bolster its presence in Germany’s industrial heart of the Rhineland.
The firm has not yet made a decision on which office to close, but Cologne is believed to be the most likely option with the office lease understood to be expiring in 2017.
Freshfields’ history in Cologne dates back to legacy firm Deringer Tessin Herrmann & Sedemund, which was headquartered in the city from 1970 until the tripartite merger with Freshfields and Hamburg-based Bruckhaus Westrick Heller Löber in 2000. The merger made Freshfields the largest international firm in Germany and its Anglo-German heritage has been critical to the firm’s culture in the years since.
If the firm does decide to pull out of the city it would follow in the footsteps of magic circle rival Linklaters, which merged with ally Oppenhoff & Partners in 2000 before spinning out the Cologne office seven years later.
By considering a reduction in its German presence Freshfields is also joining an ongoing trend for international firms to slim down in Germany. Clifford Chance undertook a review of its German offering last year following the election of Peter Dieners as regional managing partner. The review saw nine partners asked to leave the firm, and there has been a steady stream of Clifford Chance partners quitting for rival practices in the course of 2015.
Freshfields has also seen departures and moves from Cologne in recent years. In 2014 a team of arbitrators quit Freshfields to set up a Cologne boutique, Borris Hennecke Kneisel. Two years previously the firm relocated two Cologne-based employment lawyers to Frankfurt after its entire Frankfurt employment team also quit to set up a boutique.
Cologne and Düsseldorf are geographically close. While there are still a number of firms with a base in the former, the majority of firms looking to establish a presence in the Rhineland, which is Germany’s industrial engine, plump for Düsseldorf instead.
In 2010 German firm Graf von Westphalen split from its Cologne and Freiburg teams but chose to launch in Düsseldorf instead, while in 2007 Beiten Burkhardt merged Cologne and Düsseldorf into the latter city. A number of DAX30 companies, such as Bayer, Eon, Henkel and RWE, are headquartered in or near the city, while only Lufthansa has its headquarters in Cologne.
More recently a spate of international firms have chosen to shut down their Berlin offices in favour of focusing on other centres such as Düsseldorf, Frankfurt and Munich. This year has seen Orrick Herrington & Sutcliffe and Olswang both pull out of the German capital.
In a statement Freshfields said: “We constantly strive to keep our service offering and our structures at the cutting edge in order to keep them perfectly aligned with our clients’ changing needs and priorities. To this end, we are currently working on medium-term plans to merge our offices in Cologne and Düsseldorf into one office.
“This will provide us with the perfect platform to create even larger and stronger teams for our clients. The essential aim is to have a stronger presence in the Rhineland. This will put us in a position to provide even better advice and service to our clients in this region and beyond. It will also enable us to provide them with even more efficient assistance and support with their key strategic plans.”
For more on Germany’s decentralised legal market, see our January 2014 special report, A sense of place