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The COVID-19 pandemic is putting law firm merger activity on ice, according to two consultancies that track such deals.

The effects of the international outbreak of the coronavirus can be seen in the first-quarter data collected by Altman Weil. The consultancy tracked only 17 U.S. law firm merger announcements during the first quarter, a 37% drop from Q1 2019.

Eleven of those merger announcements came in January; at that point, reported virus cases were mostly confined to China. Merger announcement activity had slowed by the end of February, and in March, the only law firm combination announced was the tie-up of two small New York firms.

"These are lawyers. Lawyers are not inclined to make risky moves in an uncertain environment," said Altman Weil principal Eric Seeger.

Fairfax Associates—which measures finalized mergers rather than newly announced deals—tracked 21 completed mergers last quarter. That's lower than the 25 deals that were inked in Q1 2019, but it's higher than Fairfax's 10-year average for the first quarter.

Many of the mergers were likely reached long before the coronavirus gripped the country's attention. "Q1 is not going to be a strong indicator of what's going to happen in the next couple of quarters," said Fairfax Associates principal Lisa Smith.

Both Seeger and Smith separately said they expect lower second-quarter merger numbers. The pandemic has already affected at least one previously announced merger—Troutman Sanders and Pepper Hamilton announced in March that they were postponing their merger by three months, from April 1 to July 1.

Altman Weil and Fairfax Associates said law firms are still interested in merging and combining with others, but the coronavirus has put a dampener on that activity. For one, law firm mergers require an element of face-to-face contact and in-person meetings; like other industries, Big Law has transitioned to remote work in an effort to stop the virus from spreading and infecting others.

But the pandemic's economic fallout means that law firm leaders are preoccupied with how their own business is doing. Some firms have already begun to lay off staff, pause partner draws and cut staff salaries in response to the pandemic.

That atmosphere means law firms are unlikely to acquire smaller firms and groups or bring on lateral partners, both Smith and Seeger said. However, they noted that, at this point, law firms are adding lateral partners who were well into the hiring process before the pandemic's effects began bearing down on law firms in late March.

"It doesn't look good when you're laying people off over here and you're adding people over there," Seeger said. "Acquisitions require management attention that just isn't available right now."

Despite the cuts law firms are making in response to the pandemic, it also creates buying and acquisition opportunities as well, Smith said. It also might expose how precarious a firm's financial health might be in an economic downturn, she added.

"In a few months, we might see some firms that are in need of saving," Smith said.

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