Why mergers of equals are so rare

Why mergers of equals are so rare

If mergers of equals are the ideal, why then do so few take place? After all, there are several law firms with equivalent-sized peers. The problem is that many of these firms are occupying the same market position (or at least trying to). They may even mirror each other’s geographical position. Inevitably this means the partners in firm A spend most of their working lives competing against partners in firm B to win work from the same clients and the same potential clients. “Why not just combine and stop the endless competition? We’re even the same size. It’s a perfect fit,” you may say. That sounds logical, but it’s not that simple.

Let us say that in each of these firms there are two finance rainmakers apiece who dominate the relationships with the key banking clients. If such client relationships are in conflict then the deal is a non-starter. But, even if they do not generate business conflicts, rainmakers from either firm may wonder what is in it for them. Why invite your greatest competitors for your best clients’ attention into the room next door? If the other

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About the author:

Richard helps law firms with important strategic decisions. He advises on areas such as merger, practice development and geographical expansion. He also provides assistance to law firms in relation to organisational and operational issues.

Richard has spent over 16 years working in the legal sector focused on the UK and global legal markets. He previously worked at Jomati as a strategy consultant and authored the Jomati Report series between 2009 and 2014.

Prior to that, Richard worked at US-based, Hildebrandt International, and also held senior, legal sector editorial roles in London and Paris.