Law firm mergers are at a 20-year high. So says Kristin Stark, a principle at law firm consultancy Fairfax Associates. And it's clear to see why. Just this week, Womble Bond Dickinson (an AmLaw 100 firm) announced that it would combine with Lewis Roca (an AmLaw 200 firm) on January 1, 2025. The merger would create a 1,300-lawyer firm with about $750 million in revenue.

“Both of our firms recognize there’s a need to build scale, to have a deeper bench, in order to provide the type of legal services that our clients need, both in terms of skill set and also geographical reach,” Merrick Benn, chairman of Womble Bond Dickinson, told Bloomberg Law.

But they're not alone: Troutman Pepper and Locke Lord, as well as  Ballard Spahr and Lane Powell have also announced mergers.

So what's going on?

“Clients have been consolidating their outside counsel relationships largely in an effort to get volume discounts by giving more work to a smaller number of firms,” Jordan Abshire of Abshire Legal Search told Bloomberg. He added that firms are feeling pressure to reach clients in more places.

Performance

As Reuters notes, Big Law has had a banner year so far. "Revenue increased an average of 11.4% during the first six months of 2024 compared with the same period last year, driven by billing rate and demand growth," their reporting cites. "The top 50 highest-grossing U.S. firms had the strongest revenue growth at 13.8% in the first half of 2024, according to the survey results. The second 50 firms had 7% and the next 100 firms had 8.8% revenue growth. According to The American Lawyer trade publication, the top grossing U.S. law firm in 2023 was Kirkland & Ellis, with $7.2 billion in revenue."

Verdict

Big Law has definitely seen revenue growth this year, but firms who believe merging with another firm can help them catch up should be cautious of this strategy. Furthermore, clients are parsing out work to a smaller group of firms as well as relying more heavily on ALSPs.