The American Lawyer published an article recently by Andrew Maloney that is an insightful case study on how combinations practically lead to growth. Some think that one firm's business plus the other firm's business will be the total business of the new firm, which leads many partners to question the real benefit of going through with the inherent pain and trouble of a merger. But that thinking fails to take into account the synergy that the new firm — with new locations, expertise, and capabilities — can offer existing clients, and the new deals that can generate.
The article uses Crowell & Moring entering Chicago last year by a combination with two legacy firms (Brinks Gibson & Lione and Kibbe & Orbe) as an example:
"I think our largest potential for growth is with existing clients," said Gus Siller, former president of Brinks and now co-chair of Crowell's technology and IP department. "And both Crowell and legacy Brinks had significant clients in the Chicago market. Crowell had some clients in the Chicago market that Brinks didn't have, so we're looking to grow clients in both directions."
Two examples later in the article highlight how this is working, practically — the first a dispute involving Mariott, a long-time Crowell client, that was resolved favorably in part due to technical expertise of a legacy Brinks attorney; the second an IP deal for a multinational investment bank that was a Kibbe & Orbe client, but that none of the legacy firms could have gotten before the combination.
In our work doing combinations across the country, we have seen these dynamics at work again and again. Without a crystal ball, of course, you can't predict exactly how it will happen. But partners in the trenches of everyday work often struggle to see the deals that they could also be getting from existing clients with an expanded toolbox of services and locations to sell. As we consult firms on the possibilities of combinations, this is an analysis that we help them consider — how does this merger allow both legacy firms to expand existing client work? That, we also find, can sometimes be the biggest untapped potential for growth.
If your firm is looking to grow in existing markets, or to expand to new markets, please reach out for a free consultation.
For the full article from law.com, click here.