While law firm mergers and acquisitions came to a near halt during the pandemic, recent trends indicate they are on the rise again. Attorneys say the trend of law firms acquiring or merging with other firms provides clients with better representation — and more attorneys across varying specialties to meet client’s needs.
Some local firms have expanded within their state or across state lines, while others have joined alliances allowing them to offer representation to clients around the country and the world.
With more businesses reaching across state and national borders, attorneys say, expanding a law firm’s boundaries and employees is necessary to meet the demands of a post-COVID-19 business climate.
In 2022, law firm consultant agency Fairfax Associates said it tracked 46 completed law firm mergers. While the number is down from 2020, when mergers dropped due to the pandemic, the trend is again on an uptick. Already in 2023, the agency has tracked six merger deals, with several more expected. However, the agency said the number of mergers and acquisitions remains below the 10-year historical average of 55 deals per year.
In January 2023, Columbus, Ohio-based Bricker & Eckler announced it was merging with Cincinnati-based Graydon Head & Ritchey to become Bricker Graydon. The new firm will have offices in Indiana, Kentucky and Ohio with 378 employees, more than 200 of them attorneys.
That merger joins others like Maynard Nexsen, the merger of Alabama-based Maynard Cooper & Gale and Carolinas-based Nexsen Pruet that will form a 550-attorney firm throughout the Southeast, and Holland & Knight’s merger with Waller Lansden Dortch & Davis to create a nearly 2,000-attorney strong firm with offices in Tennessee, Alabama, Texas and Washington, D.C., as well as globally.
In October 2019, regional law firm Bingham Greenebaum Doll announced it would combine with Dentons, the world’s largest law firm, to form Dentons Bingham Greenebaum. The announcement was part of a broader arrangement that included Pittsburgh-based law firm Cohen & Grigsby combining with Dentons and rebranding as Dentons Cohen Grigsby.
Douglas Barr
The combinations with Cohen & Grigsby and Bingham Greenebaum Doll — including its offices in Lexington, Louisville, Cincinnati, Indianapolis; Jasper, Indiana; and Evansville, Indiana — grew Dentons’ global reach to 181 offices at the time, with more than 10,000 attorneys working in 70 countries.
Combining firms allows a legal office to provide clients with representation where they need it, said P. Douglas Barr, managing director for Stoll Keenon Ogden. In July, Stoll Keenon Ogden — which operates offices in Lexington, Louisville and Frankfort; and in Indianapolis and Evansville, Indiana — merged with Katz Korn Cunningham to increase the size of its Indianapolis office, Barr said.
“We have clients that do business in Kentucky and Indiana and in other states,” Barr said. “So much about the lawyer/client relationship is based upon personal relationships. If I have a client here in Lexington whom I have known and served for a number of years who has some kind of legal problem that requires help in Indiana, that client is better served if I can either do the work myself or have one of the lawyers we have located in Indiana do the work.”
With businesses growing into multi-state and multi-nation operations, firms with offices in multiple states are better equipped with knowing the finer points of the law in those states, he said.
For instance, if a business in Indiana decided to start a distillery, a firm with offices in both Kentucky and Indiana could provide representation. A Kentucky ofiice might have expertise in distillery licensing law, while its Indiana o.ces would have expertise with regulations regarding alcohol production, distribution and sales in that state, a spokesperson for Stoll Keenon Ogden said.
“Business doesn’t stop at the state line,” Barr said.
Mergers and acquisitions, said Jim Frazier, managing member of McBrayer PLLC, can also be about what the firm needs. He said changes in how law firms do business since the pandemic have also influenced mergers and acquisitions.
Jim Frazier
The pandemic “changed the landscape for law firms,” Frazier said. “So many people went home and didn’t come back. The big firms are downsizing their physical space by up to a third. That creates some unsettledness within the legal community, which kind of sets the stage for lateral acquisition.”
McBrayer celebrated its 60th anniversary this year. In December, the firm added eight attorneys and several sta. members from Middleton Reutlinger to its Louisville office, making it one of the 10 largest law firms in Louisville, and with more than 60 attorneys statewide. The company had previously merged with Reed Weitkamp Schell & Vice in Louisville in 2019, and added people from Fulkerson Kinkel & Marrs in 2017.
Frazier said growth of that kind allows the law firm to expand its practice by field, like expertise in corporate litigation, or by client base. It also allows them to expand the number of attorneys, he said.
“We are all scrambling to find young lawyers who want to come into the office. Most don’t,” he said. “People are looking everywhere for people. My folks are constantly being approached to be poached, and I do the same thing to other law firms.”
The pandemic changed how people viewed work, he said.
“Some of these folks went home and realized that there’s a better quality of life,” he said, noting several attorneys who transitioned to in-house work with clients or a corporate job. “A lot of them never came back to what we call the grind of billable hours.”
Frazier said affiliations among legal networks also help law firms expand without merging with other firms. For example, McBrayer is part of Meritas and SCG Legal — global legal networks that allow firms to connect their clients with legal representation in other states and countries.
“It has allowed us to reach clients in other states,” Frazier said. “I do work in California. I do work all over the world by virtue of [these] organizations. [They] allowed groups like us, regional-sized firms ... to have that same reach without all the overhead issues that go with it.”