The Lawyer (UK) revealed yesterday that six months of merger talks between Australian firm Mallesons and global giant Clifford Chance have failed due to "economic conditions"
The Lawyer reveals that the deal which would have made Clifford Chance the largest law firm in Australasia, with more than a thousand lawyers in the region has been "scuppered" by the state of the worldwide economy.
The Lawyer reports:
Mallesons chief executive partner Robert Milliner declined to comment directly on the talks, but told The Lawyer: “How and when we move on opportunities will obviously depend on when we think all the relevant planets are aligned.”
The talks revived a deal that was first mooted in 1999, but which broke down in 2000 because Clifford Chance would not accept the entire Mallesons partnership.
This time round it is understood that Mallesons was more amenable to the UK firm’s demands that a third of its Australian partnership be trimmed.
“Clearly we need to understand what long-term changes may result from a resetting of the global market,” added Milliner.
There is broad consensus that the Australian legal market has too many lawyers chasing too few deals, and Milliner, along with others, has said that the firm’s only growth prospects lie in Asia.
Management at Clifford Chance saw the Mallesons deal as a quick way to do that and an opportunity to differentiate itself from the rest of the magic circle by becoming the law firm of choice in Asia.
Clifford Chance declined to comment.
Full article at http://www.thelawyer.com/cgi-bin/item.cgi?id=136006&d=415&h=417&f=416
The Lawyer have also written a leader about the failed deal writing….
No wonder an Asian solution presented itself. Any Mallesons deal was conditional on the Australian firm slimming down; Clifford Chance has evidently learnt one thing from its US experience in trying to get the weeding done beforehand. It would have definitively shifted the firm’s emphasis east and delivered some crucial differentiation within the magic circle. Revenue from the region would have leapt from £106m, or 8 per cent of current turnover, to nearly £350m, which would have accounted for 22 per cent of any merged entity.
Full Leader at http://www.thelawyer.com/cgi-bin/item.cgi?id=136005
