The alliance model is struggling, but watch out for China
In the past few months there has been a rash of European, UK and US firms saying goodbye to alliance partners, and more often than not it is because they want something a little more concrete than a loose association. Has the alliance model outlived its usefulness?
Earlier this month Olswang and Cooley became the latest firms to announce they had called time on their partnership. The pair had been in a non-exclusive alliance for just over 18 months, having sealed the deal in June 2010.
It is understood that Olswang and Cooley had flirted briefly with the idea of merging before splitting, although neither firm would comment on the matter, nor on how they intended to proceed following the break.
That said, Cooley is understood to be keen on having a presence in London, but what form that will take – merger, office launch or another alliance – is not yet known.
When Olswang tied up with Cooley it was looking to rebuild its coverage of the US market after its previous dalliance with Greenberg Traurig collapsed when the latter hired former Mayer Brown co-vice-chair Paul Maher and launched its own office in London. In that relationship too, Olswang and Greenberg had a tacit agreement that the door would be open for a full merger in time.
So you could understand if management at Olswang was a little jaded with the model.
And if that was the case, Olswang would be far from alone in feeling that way.
Last week (29 March) Osborne Clarke announced that it was merging with its Spanish and Italian alliance partners while distancing itself from its European allies that did not want to merge.
Likewise, Herbert Smith called time on its European alliance after failing to get buy-in for a full merger, while Pinsent Masons and Salans cut ties at the end of 2011 as Pinsents looked to open offices in France and Germany.
But while there is an undeniable trend emerging, it is far from curtains for alliances, particularly as Western firms look to gain a foothold in China – although it may only be a matter of time before mere alliances in Asia won’t cut it for firms either.