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To Merge or Not to Merge?

By Ronald H. Shechtman
May 01, 2016

The “one-percenters” that we are hearing so much about in this year's primary election campaigns also have an analogous place in current law firm economics. The rich are getting richer, and most others are struggling to hold their own.

Thus the law firm surveys tell us that the industry is growing, but that much of the growth is concentrated at the top, largest firms. The great majority of the AmLaw 200, we are told by the surveys, face stagnant or lowering demand, increased pressure on rates, and the greatest merger activity than ever before. As of last November, Altman Weil reported a record of 79 mergers in 2015, the largest number since it starting keeping track.

There are also the cases of Dewey & Leboeuf, Howrey and Dickstein Shapiro and others that never really made it to merger. We know that many of those transactions called “mergers” of law firms actually mask one firm picking at the carcass of another, sometimes calling the process a merger, and other times simply taking large groups of one firm, and leaving the other lawyers to dissolve their firm or merge into another law firm that will sharply reduce their ranks in short order.

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