London-based law firms Allen & Overy and Shearman & Sterling have announced their intention to merge, creating a formidable new competitor in the legal industry. The merger, which is subject to approval by partners at both firms, is set to establish a combined entity named Allen Overy Shearman Sterling, boasting a global team of over 3,900 lawyers.
The decision to merge comes after Shearman & Sterling’s previous merger talks with Hogan Lovells fell through earlier this year. The deal provides UK-founded Allen & Overy with a significantly expanded presence in the United States and reflects the growing trend among top London law firms seeking to bolster their footprint in the US market.
In a statement, Wim Dejonghe, Senior Partner at Allen & Overy, emphasized the firms’ commitment to meeting client demands for high-quality advice in an integrated and globally consistent manner. “We, A&O Shearman, will do this by accelerating our ability to bring the best of both firms, regardless of geography,” Dejonghe stated.
Both Allen & Overy and Shearman & Sterling have referred to the combination as a merger rather than an acquisition, indicating a sense of partnership and collaboration in the venture. The firms have not yet determined the leadership structure for the newly formed entity, but they have affirmed that officials from each firm will be involved in shared leadership roles.
Allen & Overy, as the larger of the two firms, currently boasts a global team of over 3,000 lawyers. In the previous year, the firm generated nearly $2.7 billion in gross revenue and recorded profits per equity partner exceeding $2.4 million, as reported by the American Lawyer.
According to American Lawyer data, Shearman & Sterling, with over 700 lawyers, achieved gross revenue surpassing $1 billion and profits per equity partner of over $3 million in the same period.
This merger represents a significant development in the legal industry, as it brings together the strengths, expertise, and resources of two highly reputable firms. The combined entity will be better positioned to meet clients’ evolving needs on a global scale, with a broader range of services and an expanded geographic reach.
For Allen & Overy, the merger grants a more substantial presence in the United States, a market that has seen increased activity and demand for legal services. By joining forces with Shearman & Sterling, Allen & Overy will enhance its capabilities to deliver top-tier legal advice to clients navigating complex cross-border matters.
The merger will also contribute to the broader trend of consolidation within the legal industry. Firms are increasingly seeking strategic partnerships and combinations to achieve economies of scale, diversify their service offerings, and maintain a competitive edge in an evolving market landscape.
As the legal industry continues to face disruption and the demand for legal services undergoes transformation, the Allen & Overy Shearman Sterling merger signals a proactive approach to staying ahead of the curve. The two firms are positioning themselves for continued success and growth in a dynamic and highly competitive environment by pooling their resources, knowledge, and talent.
The merger is expected to create synergies and foster collaboration, allowing the combined entity to provide clients with comprehensive and seamless legal solutions. Clients can look forward to accessing a wider array of specialized expertise, enhanced geographic coverage, and an integrated approach that leverages the strengths of both firms.
While awaiting partner approval and finalizing the details of the merger, Allen & Overy and Shearman & Sterling are setting the stage for a transformative union that will reshape the legal landscape and elevate their positions as global leaders in the legal industry.