Will the City gain a new US super-firm?
Law firms Shearman & Sterling and Hogan Lovells have not denied that they are in merger talks, sparking speculation that a tie-up may be on the cards.
Shearman held a senior equity partner meeting in London on “something transformative” earlier in December, according to unnamed sources quoted by The Lawyer, with some indicating a vote on a potential tie-up could take place as early as 31 December.
Responding to the report, a spokesperson for Hogan Lovells said: “As a leading global law firm we regularly review our global strategy and opportunities that we believe may be available to us, and that includes discussions with different firms in the market. This demonstrates our confidence in our unique offering and our balance of practice areas, global footprint and sector strength.”
Similarly, Shearman said: “We continuously consider the various levers of growth that are accessible to us as part of our strategic planning process. These include both internal and external opportunities that would benefit our firm and our clients. Beyond that, we never comment on market rumors or speculation.”
A Shearman-Hogan Lovells merger would create a new US super-firm with a combined annual revenue of around £2.97 billion. As for geographical coverage, Shearman would gain access to Hogan Lovells’ extensive European operations, whilst complimenting HL’s Dubai gaff with its Abu Dhabi outpost.
According to the Legal Cheek Firms Most List 2023, Hogan Lovells currently offers 50 TCs every year, whilst Shearman takes on 15 rookies with both firms paying their new recruits £50,000 in their first year and £55,000 in their second year. Hogan Lovells NQs then jump to £107.5k, but Shearman does not disclose its London NQ salaries.
If intake sizes remain at current levels, the new firm would number 65 trainees, on par with Herbert Smith Freehills and joint seventh on the Most List for most trainees. The firms’ combined London offices would also generate over £500 million, according to current earnings reports.
Whilst Shearman can trace its history back to birth of the law firm in America, Hogan Lovells was created from the 2010 merger between the London firm Lovells Washington DC’s Hogan & Hartson. Hogan Lovells clearly goes in for firms with a lot of history; at the time of the merger, Hogan & Hartson was the oldest major law firm headquartered in DC!
In the lead up to this merger, there was also much speculation over what the new name would be, with Love Harts and HogLove the most memorable suggestions.
Let us know what you think this potential new US super-firm should be called in the comments below…
