US giant undeterred by failed talks as search for City ally continues
Mayer Brown has been in secret merger talks with Simmons & Simmons as the Chicago-headquartered firm looks at ways of bolstering its dwindling presence on the UK side of the Atlantic.
It is understood that the two firms held talks, which have now been aborted, over the possibility of creating a £1bn global business that would have gifted Mayer Brown more UK and European coverage and extended Simmons’ reach in Asia.
Simmons, which is to open a Chinese ’hub’ in Beijing this year (The Lawyer, 31 May), is targeting growth in that emerging market, where Mayer Brown has a substantial presence through its 2008 merger with Johnson Stokes & Master.
“China’s right at the top of the list. The US is a big issue and we’ve thought about [that market] on and off for a decade,” commented Simmons managing partner Mark Dawkins.
Pointing out that it is firm policy to refuse to comment on merger talks, Dawkins added: “We have a clear strategy that works for us. We’re not blind to what’s happening in the market.”
Despite the fact that discussions with Simmons were unsuccessful, Mayer Brown is thought to be continuing to pursue a City union, with sources citing the catalyst as disappointment about the growth of the London office that it acquired in 2002 as a result of the tie-up with Rowe & Maw.
The firm signed up for 220,000sq ft of new office space at 201 Bishopsgate in 2007. One source close to the firm confirmed that the real estate deal was ”predicated on a business plan to increase growth in London by 70 per cent”.
“It hasn’t had growth of 70 per cent; in fact it’s probably gone down,” the source added.
While Mayer Brown’s 2009 global average profit per equity partner figure of $1.05m (£726,000) was higher than the £520,000 posted by Simmons in 2008-09, Mayer Brown’s UK office experienced a 28 per cent fall in revenue last year to $146.3m. This was one of the largest drops for any US firm in London last year.
News of Mayer Brown’s merger quest comes after US firm Sonnenschein Nath & Rosenthal and UK counterpart Denton Wilde Sapte asked their partners to approve a September merger.
Hogan & Hartson and Lovells completed their transatlantic merger at the beginning of May.