Law-firm mergers on a national basis began to tick upward for the first time in years in the fourth quarter of 2010, and the results for the first quarter of this year suggest a continuing recovery.
But the overall trend is down.
Four years ago, when the legal marketplace still was booming, there were 60 law-firm mergers and acquisitions nationally, says the Newtown Square legal-consulting firm Altman Weil Inc.
Last year, despite the fourth-quarter increase, there were just 39.
And while the mergers of a few years ago reflected exuberance over what seemed like an endless gusher of legal revenue, the current mergers have a more strategic feel. Simply opening an office and waiting for clients to walk through the door isn't going to work when legal revenue is flat.
"That is the field-of-dreams approach," says Archer & Greiner president Christopher Gibson.
Build it and they will come - except in this market, they probably won't.
So while some law firms are growing, they are doing it mostly by absorbing existing business. This is happening most noticeably among larger firms such as Archer & Greiner, which merged with Herten, Burstein, Sheridan, Cevasco, Bottinelli, Litt & Harz L.L.C. on May 2. It concluded an earlier merger in January 2009 with Pelino & Lentz, expanding Archer & Greiner's Philadelphia office to 32 lawyers.
But it is also occurring on a more granular level, with firms, sometimes very large ones, picking up single lawyers or small groups with very big and prosperous practices.
These hires typically don't make news, but they do bring in business. Law-firm leaders say they get calls all the time about lawyers seeking to make a jump. Very often, these lawyers will not be hired because they can't bring clients with them.
