Law: A case of merger in the first degree

The trend is for the creation of new legal giants, but is it one that firms will be wise to follow?

OLD LAW firms never die, it seems, they just get engulfed by larger firms, or merge to become twice the size. A number of centuries-old firms have been more than willing recently to be swallowed up in a bid to achieve the much-vaunted ideal of critical mass and added value of management speak.

One well-established firm of City lawyers, Frere Cholmeley Bischoff, which was founded in 1750, has decided to throw in its lot with national firm Eversheds. When the merger takes place on 1 August, the new firm Eversheds and Frere Cholmeley will be the largest in the UK, with 322 partners and 988 fee earners, overtaking Clifford Chance, which has 1023 fee earners in the UK.

Clifford Chance itself is the result of the merger of Clifford Turner with Coward Chance in 1987 to form London's largest firm. How long that ranking will last will depend on how successful Clifford Chance is in putting in place its announcement earlier this year to double the number of its lawyers in Europe. The perception of Clifford Chance and Eversheds is also very different, with the former seen as one of the Big Five City law firms, and the latter sometimes unkindly referred to as a UK McDonalds of the legal profession, but that image has been changed recently with Eversheds getting US chemical giant DuPont as one of its clients after a "beauty parade".

It seems that the urge to merge is irresistible, even at the expense of losing a long-standing name. The 213-year-old Wilde Sapte has just narrowly avoided losing its independence and name now that the merger with Arthur Andersen is off, but it is seeking another merger partner.

Keith James, Eversheds' executive chairman comments: "Merger should not be an end itself. It should only take place if it is the best way of developing the firm. For some firms, it may be better to grow organically, particularly those with niche practices. For mergers to succeed the cultures of the two firms must be compatible. They must have similar ambitions. The breakdown of talks between Arthur Andersen and Wilde Sapte illustrates this."

But even the route to the Eversheds/Frere Cholmeley deal - and what will essentially be the demise of 248 year old Frere Cholmeley - was not a smooth one. The background to the story is the boom period of the 1970s and 1980s, when Frere Cholmeley's debt problems arose from expansion in London and overseas in Barcelona, Berlin, Dubai, Milan and Moscow. In a bid to stem the tide of its lawyers leaving over the last five years, it did what many businesses do - it called in the management consultants, in this case Hodgart Temporal.

Such a move almost always leads to drastic measures, but Hodgart Temporal director Alan Hodgart stresses that three-quarters of his law firm clients do not have to take drastic measures, and in this case the report was that Frere Cholmeley did have viable strategy prospects.

The advice was to focus on four core areas - financial services, media and entertainment, property and eastern Europe - and having carried out that exercise, the consultants were called back in to advise further on whether or not to merge and with whom.

Eversheds' London managing partner Peter Scott and Frere Cholmeley's managing partner Alan Jenkins met at a dinner last year, and the merger was announced last month.

But it is not simply a matter of Eversheds and Frere Cholmeley riding off into the sunset as the UK's legal giant - there has also been a breakaway firm from Frere Cholmeley called Forsters which will be based in Mayfair and will have 11 partners and 44 lawyers covering property, private client and corporate/media work. Other partners are leaving to join other firms in the City - Bird & Bird, Osborne Clarke, Denton Halland Field Fisher Waterhouse.

That has fuelled speculation as to whether the clients will stay with Frere Cholmeley. It is thought that Elton John, who is a client of Frank Presland (who will be joint senior partner post-merger) will stay, and the firm also has other high profile clients, including Warner Music and McDonalds. The management consultant's advice as to keeping clients is that the merger partners have to make a business case to the client: "If the business logic is there, the business people will see it."

Rumours of other mergers are rife in the City - mergers of law firms with other law firms, and also with firms of accountants. But Hodgart says that although Frere Cholmeley's financial position was "somewhat unique, there are a number of London firms which are already considering merger to reach perceived strategic goals. The problem is that sometimes it makes much more sense for firms to split into two".

Arts and Entertainment
Joel Edgerton, John Turturro and Christian Bale in Exodus: Gods and Kings
film Ridley Scott reveals truth behind casting decisions of Exodus
Arts and Entertainment
An unseen image of Kurt Cobain at home featured in the film 'Kurt Cobain: Montage of Heck'
filmThe singers widow and former bandmates have approved project
Arts and Entertainment
Jake Quickenden and Edwina Currie are joining the I'm A Celebrity...Get Me Out Of Here! camp
tv
Arts and Entertainment
George Mpanga has been shortlisted for the Critics’ Choice prize
music
Arts and Entertainment
Roisin, James and Sanjay in the boardroom
tvReview: This week's failing project manager had to go
PROMOTED VIDEO
Arts and Entertainment
Carrie Hope Fletcher
booksFirst video bloggers conquered YouTube. Now they want us to buy their books
Arts and Entertainment
Damien Hirst
artCoalition's anti-culture policy and cuts in local authority spending to blame, says academic
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment

ebooksNow available in paperback
Arts and Entertainment

ebooks
Arts and Entertainment
A comedy show alumni who has gone on to be a big star, Jon Stewart
tvRival television sketch shows vie for influential alumni
Arts and Entertainment
Jason goes on a special mission for the queen
tvReview: Everyone loves a CGI Cyclops and the BBC's Saturday night charmer is getting epic
Arts and Entertainment
Image has been released by the BBC
tv
Arts and Entertainment
Will there ever be a Friends reunion?
TV
News
Harry Hill plays the Professor in the show and hopes it will help boost interest in science among young people
arts + ents
Arts and Entertainment
A Van Gogh sold at Sotheby’s earlier this month
art
Arts and Entertainment

MusicThe band accidentally called Londoners the C-word

Arts and Entertainment
It would 'mean a great deal' to Angelina Jolie if she won the best director Oscar for Unbroken

Film 'I've never been comfortable on-screen', she says

Arts and Entertainment
Winnie the Pooh has been branded 'inappropriate' in Poland
books
Arts and Entertainment
Lee Evans is quitting comedy to spend more time with his wife and daughter

comedy
Arts and Entertainment
American singer, acclaimed actor of stage and screen, political activist and civil rights campaigner Paul Robeson (1898 - 1976), rehearses in relaxed mood at the piano.
filmSinger, actor, activist, athlete: Paul Robeson was a cultural giant. But prejudice and intolerance drove him to a miserable death. Now his story is to be told in film...
Arts and Entertainment
Taylor Swift is dominating album and singles charts worldwide

music
Arts and Entertainment
Kieron Richardson plays gay character Ste Hay in Channel 4 soap Hollyoaks

tv
Arts and Entertainment
Midge Ure and Sir Bob Geldof outside the Notting Hill recording studios for Band Aid 30

music
Arts and Entertainment
Look out: Broad shoulders take Idris Elba’s DCI John Luther a long way
tvIdris Elba will appear in two special episodes for the BBC next year
Latest stories from i100
Have you tried new the Independent Digital Edition apps?

ES Rentals

    Independent Dating
    and  

    By clicking 'Search' you
    are agreeing to our
    Terms of Use.

    Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

    Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

    It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
    Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

    Sol Campbell cries foul at Labour's mansion tax

    The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
    Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

    Sarkozy returns

    The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
    Is the criticism of Ed Miliband a coded form of anti-Semitism?

    Is the criticism of Miliband anti-Semitic?

    Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
    Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

    Ouija boards are the must-have festive gift

    Simon Usborne explores the appeal - and mysteries - of a century-old parlour game
    There's a Good Girl exhibition: How female creatives are changing the way women are portrayed in advertising

    In pictures: There's a Good Girl exhibition

    The new exhibition reveals how female creatives are changing the way women are portrayed in advertising
    UK firm Biscuiteers is giving cookies a makeover - from advent calendars to doll's houses

    UK firm Biscuiteers is giving cookies a makeover

    It worked with cupcakes, doughnuts and macarons so no wonder someone decided to revamp the humble biscuit
    Can SkySaga capture the Minecraft magic?

    Can SkySaga capture the Minecraft magic?

    It's no surprise that the building game born in Sweden in 2009 and now played by millions, has imitators keen to construct their own mega money-spinner
    The King's School is way ahead of the pack when it comes to using the latest classroom technology

    Staying connected: The King's School

    The school in Cambridgeshire is ahead of the pack when it comes to using the latest classroom technology. Richard Garner discovers how teachers and pupils stay connected
    Christmas 2014: 23 best women's perfumes

    Festively fragrant: the best women's perfumes

    Give a loved one a luxe fragrance this year or treat yourself to a sensual pick-me-up
    Arsenal vs Borussia Dortmund: Alex Oxlade-Chamberlain celebrates century with trademark display of speed and intuition

    Arsenal vs Borussia Dortmund

    The Ox celebrates century with trademark display of speed and intuition
    Billy Joe Saunders vs Chris Eubank Jnr: When two worlds collide

    When two worlds collide

    Traveller Billy Joe Saunders did not have a pampered public-school upbringing - unlike Saturday’s opponent Chris Eubank Jnr
    Homeless Veterans Christmas Appeal: Drifting and forgotten - turning lives around for ex-soldiers

    Homeless Veterans Christmas Appeal: Turning lives around for ex-soldiers

    Our partner charities help veterans on the brink – and get them back on their feet
    Putin’s far-right ambition: Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU

    Putin’s far-right ambition

    Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU
    Tove Jansson's Moominland: What was the inspiration for Finland's most famous family?

    Escape to Moominland

    What was the inspiration for Finland's most famous family?