Financial instability may mean mergers are the best option for small law firms
To merge or not to merge, that is the question.
January 23, 2012 at 06:11 AM
2 minute read
The original version of this story was published on Law.com
To merge or not to merge, that is the question. It seems like lately, a lot of law firms have been leaning toward merging: The end of 2011 and the beginning of 2012 were filled with announcements of major mergers between the likes of Bryan Cave and Holme Roberts and McKenna Long and Luce Forward. The Wall Street Journal reported on Friday that this merging surge is unlikely to abate in the coming months.
The reason behind this, according to the WSJ, is that clients have gained the financial upper hand since the recession began, and law firms can no longer just raise billing rates when profits are low. For many small law firms, this may mean the choice between merging or going out of business.
However, mergers can be very costly, what with the hassle around integrating the new employees, offices and computer systems, and the potential departure of unhappy partners, who take clients with them when they leave.
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