Ashurst will move to ramp up its lawyer headcount in Asia and shake up its partner remuneration over the next three years in the wake of its ambitious tie-up with leading Australian firm Blake Dawson.

The City law firm, which agreed the union with Blakes last week (23 September), is planning to sharply increase joint lawyer numbers in Asia from around 155 lawyers at present. One Ashurst partner predicted the Asia headcount could double by 2014.

The tally will come in addition to Blakes' lawyer count in its Australian homeland, which currently stands at 745.

The deal will see the two firms combine their businesses in Asia from March 2012, with the 190-partner Blakes rebranding entirely under the Ashurst name both in Asia and Australia from the same point.

The union will create a firm with 419 partners across 14 countries operating under the Ashurst brand, with both firms additionally committed to carrying out a full merger – with a single global profit pool – in 2014.

The full merger, which will need to go to a further vote by both partnerships in early 2014, is subject to Blakes bringing its finances in line with Ashurst, although the Australian firm's profitability is already around 90% of Ashurst's current average partner profits of £723,000.

It is expected that full financial integration would ultimately lead to a further shift from Ashurst's 65-point modified lockstep towards a more merit-based 
model, reflecting Blakes' eight-rung structure.

Before full financial integration takes place, all costs and profits for the combined Asia business will be split between the two firms, covering expected office launches in Beijing and South Korea.

The ambitious deal makes Ashurst the first foreign law firm to secure a union with a top-tier Australian player and comes as many City firms have sought to use the country as a platform to bolster their region-wide Asia practices. The Australia push comes after Norton Rose in 2009 unveiled a merger with Deacons, while Allen & Overy, DLA Piper and Clifford Chance have since secured major deals in the G20 economy.

Ashurst senior partner Charlie Geffen (pictured) told Legal Week: "We think that the pace of change [in the global legal market] is going to become increasingly rapid. The premier firm of the future must have scale as well as quality – you are seeing this happen already and you have to be one thing or the other. This is a change of direction. It's a big moment for the firm; it's an exciting moment."

The union substantially increases the firms' resources, forging a £550m business globally, with a total of 900 lawyers in the wider Asia-Pacific region and nearly doubling the size of Ashurst's Asia practice. The combined firm will rank within the top 40 globally, with Blakes contributing around £250m to annual turnover and 83 lawyers in Asia.

The planned growth push will consist partly of lawyers relocating from Blakes' Australian operations into Asia, where there is a significant need for common law-trained, multilingual lawyers.

Ashurst currently brings in around 7% of its revenues from Asia and hopes to increase this figure to around 10% of combined revenue. Ashurst has instructed a team of lawyers at Chinese alliance partner Guantao to advise on regulatory issues resulting from the combination. The instruction includes approaching the regulatory authorities over Ashurst's planned Beijing launch.

One Ashurst partner commented: "Achieving the kind of growth that Charlie [Geffen] wanted in Asia would have been nearly impossible without a fruitful recruitment base such as Blake Dawson's extensive Australian offices.

He added: "Charlie's goal will be to find a US merger partner in the long term, by which time we will have acquired a lucrative and expansive Asian business."

The combination between the two firms in Asia will see the creation of a six-partner management committee chaired by Asia managing partner Geoffrey Green, as well as an eight-partner integration committee. Ashurst and Blakes will retain an equal number of seats on both committees.

Green is in the process of developing a joint management structure which will see a single office head appointed in each of the firms' Asian offices.

Green said: "The firm's merger discussions in the past 10 years were based on a very New York/London-centric model which dominated the legal industry before the financial crisis. Times have changed since then and, although we would not rule out a US combination in the future, our priorities have shifted eastward."

Blakes chair Mary Padbury commented: "Both Ashurst's senior management and [Blakes managing partner] John Carrington and I are very strong believers in globalisation and share a vision of the future of the global legal industry – this vision includes a deep and high quality presence in the Asia-Pacific region."

For more on the background to the deal, see Ashurst's long, long journey to a globally transformative merger.