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In 2001, the inaugural instalment of the Fast and Furious franchise was released, and filmgoers have been treated to the likes of Vin Diesel and the late Paul Walker driving souped-up cars throughout Los Angeles ever since.
Much like the film franchise has shown no sign of slowing down over the past 20 years, neither has the revenue generation of the top 10 UK firms. The collective revenue of this group in 2001 was £3.95bn. Come 2020, the top 10 generated nearly four times as much, £15.21bn.
To put this into perspective, the firms ranked 90 to 100 in the UK Top 100 generated a combined £132.8m in 2001. In the most recent iteration of The Lawyer’s rankings, the same group posted a total revenue of £327.3m – an increase of 146 per cent.
In 2001, Clifford Chance’s position at the top accounted for just under a quarter of the cumulative revenue of the top ten, twice as much as the fourth-placed firm and six times that of the ninth and tenth places. Come 2020, that proportion taken by the number one rank has dropped to 14 per cent as the revenue generated in this peer group begins to spread more evenly.
The number ten spot in 2001 was taken by DLA. Following a merger with US-based Piper Rudnick in 2004, the acquisition of EY’s CIS operation in 2005, and a slew of worldwide office openings and alliances, the DLA of twenty years ago has grown into DLA Piper, sitting at the top of the UK 100 with a firmwide revenue of £2.1bn. This is an increase of 1,107 per cent.
Hogan Lovells is another firm that has found success through mergers. In 2001, legacy Lovells was ranked sixth, with a revenue of £286.5m. The firm invested in China, Europe and the Middle East throughout the 2000s, announcing a merger with the US-based Hogan & Hartson in 2009, completed in 2010. The merged entity ranked third this past year, with a revenue increase of 513 per cent to £1.76bn.
Not every transatlantic merger has seen the resulting entity in the running for pole position. Eversheds Sutherland, ranked tenth with a revenue of £954.7m, was formed in 2017 by a merger between the UK-based Eversheds and US-based Sutherland Asbill & Brennan. In 2001, Eversheds ranked sixth with a revenue of £227.1m, meaning the past twenty years has seen a revenue growth of 320%. Comparatively small when considering its US-UK peers.
Clifford Chance’s headquarters have remained in London throughout 20 years of growing its international footprint, particularly in Asia-Pacific. Developments include a well-established Tokyo practice since 2005, opening in Australia via merger with two local firms in 2011 and becoming one of the first foreign firms to open in Korea in 2012. Its revenue growth of 92 per cent – the lowest of the magic circle – has taken the firm from £937m in 2001 to £1.8bn in 2021.
That the firm has only dropped one place, from first to second, despite having the slowest revenue growth of the magic circle, speaks to its sheer dominance of the rankings in 2001. Though Freshfields has posted 143 per cent revenue growth since 2001, from £625m to £1.52bn, it has dropped from second to sixth place, exceeded by its magic circle companions and the above-mentioned DLA Piper and Hogan Lovells.
Allen & Overy, despite a 243 per cent growth (the highest of the magic circle), maintained fourth place in both 2001 and 2020, revenue growing from £494m to £1.69bn. Potentially sore news when thinking back on the proposed merger with LA-based O’Melveny & Myers that fell through in late 2019. Had the deal come through, it would have resulted in a transatlantic firm with a total revenue of around £2.35bn in 2020 – surpassing DLA Piper for the top spot.
Rounding out the quartet is Linklaters and its revenue growth from £505m to £1.64bn. Despite more than doubling revenue in 20 years, an increase of 225 per cent, it has been superseded by Hogan Lovells for third place in the rankings, and now sits below Allen & Overy at fifth place in the 2020 rankings.
Of the 2001 top 10, only one firm has slid out of the peer group entirely. Slaughter and May, which posted a revenue of £324m in 2001 and was ranked fifth, dropped ten places to fifteenth in 2020. Its revenue climbed a comparatively measly 56 per cent to £507m over the past 20 years, in which time it has seen its New York, Singapore and Paris offices close (the former two in 2004 and the Paris office taken over by Bredin Prat in 2005). Its place in the top ten has been taken by CMS, which continued to grow via the continued addition of firms, when the merger between CMS Cameron McKenna, Nabarro and Olswang in 2016 thrust the new entity to ninth in the 2017 UK Top 100 rankings with a revenue of £817.6m.
In the face of mergers propelling firms up the rankings, how long can the magic circle hold onto its position? While revenue is but one measure of a firm’s success, you’d be hard-pushed to find a managing partner who pays no mind to how quickly other firms are catching up and taking over in terms of revenue growth. Though some firms have had immense growth over the past twenty years, the increasing spread of revenue generated by the top 10 suggests that other firms may be catching up, and the days of a single firm holding such dominance in the UK ranking table look to be fading away.