As the economy changes pace, more firms than ever are shifting their focus from acquiring new associates to procuring partners and the client relationships that accompany it. As a result, the interest in law firm mergers is higher than ever, and there are a growing number of merger discussions occurring in California.
A common issue arising when firm leaders negotiate a merger for the first time on their own is that they assume law firm mergers work like most client mergers.
Many a corporate lawyer has commented, “I do mergers every day of my life, and I can negotiate this deal in my sleep.”
The reality, however, is that law firm mergers tend to have far fewer financial issues and far more complex people and structural issues than other corporate mergers. Unlike most client companies where the machinery doesn't have the option of getting up and walking away if the new corporation's new strategy, structure or leadership doesn't work, the operating assets in a law firm are people who can leave if they don't like the new arrangement.