Law firms merged at a brisk pace in 1st quarter

Law-firm mergers, bolstered by the recovering legal market, are off to a quick start this year, according to the Newtown Square legal-consulting firm Altman Weil, which logged 29 combinations in the first quarter.

It was the second-fastest pace since Altman Weil began tracking law-firm mergers in 2007, and reflects the growing confidence of firms that their businesses have substantially recovered from the sharp downturn in revenue in 2009 and 2010.

Included in the tally is Morgan Lewis's announced combination with the Singapore-based firm Stamford Law Corp., a transaction that closed Wednesday. That merger will bring 80 additional lawyers to the firm, which has about 2,000 in total.

Ward Bower, an Altman Weil analyst, said the improving legal marketplace had provided firms the leeway to act on strategic plans that had been shelved as they recovered from the recession. As with Morgan Lewis, many of those initiatives are focused overseas.

"The largest U.S. firms are looking outside the U.S. for opportunities to grow," Bower said. "Right after the recession, a lot of firms just hunkered down and were just trying to make it through."

One sign of the improving climate is that Dechert L.L.P, a Philadelphia-based firm with a global footprint, said Monday that it was raising salaries for first-year associate lawyers in Philadelphia and Princeton by $15,000, to $160,000, matching the salaries of first-year associates for the firm in New York, Washington, and other U.S. cities.

The great majority of mergers reported by Altman Weil involved larger firms acquiring smaller ones, and the number of lawyers brought on by the acquiring firms were rarely more than a few dozen.

But there were notable exceptions. Among them: Denton's, a global firm that merged with a 4,000-lawyer firm in China, Dacheng Law Offices, Altman Weil said. DLA Piper, another global firm with a substantial office in Philadelphia and 4,200 lawyers worldwide, acquired Davis L.L.P., a Vancouver, British Columbia-based firm with 260 lawyers.

The Morgan Lewis merger with Stamford, announced last month, followed Morgan's acquisition of Bingham McCutchen of Boston, which added about 500 lawyers and 250 staff to Morgan's headcount. It also hoisted the firm onto a short list of global players. Morgan now has more lawyers in the United States than any other law firm, and is among the top five largest firms in the world.

This year's first-quarter merger tally of 29 missed by one the highest three-month figure recorded by Altman Weil. That was in fourth quarter 2013, when there were 30 law-firm mergers and acquisitions, capping a record year of 88 total. Last year there were 82 mergers and acquisitions.