September 28, 2010 2:00 PM
Orrick-Akin the Next Megafirm?
Posted by Zach Lowe
Update2, 9/28/2010, 3:15 pm
Spokespersons for both Akin and Orrick tell us that the two firms have held "preliminary" talks.
The combined firm would have about 1,800 lawyers, according to the most recent Am Law 100 head count numbers. Akin Gump had slightly higher profits per equity partner of $1.455 million in 2009 compared to a PPP figure of $1.36 million for Orrick.
Law firm merger activity appears to be increasing after dropping off during the recession, according to Altman Weil and other sources. The most notable deals have been Hogan & Hartson's merger with Lovells and Sonnenschein Nath & Rosenthal's combination with Denton Wilde Sapte. Both are mergers of U.S. and U.K. firms, but merger talk between domestic U.S. firms also has picked up, according to Paula Alvary, a principal with Hoffman Alvary, which consults on law firm management issues.
Of course, this isn't Orrick's first merger rodeo. The firm has a long history of going pretty far down the aisle with potential merger partners only to have deals fall apart for various reasons, according to our archives. The most recent example --and probably the ugliest--was Orrick's ill-fated near-merger in 2006 with Dewey Ballantine. Executive committees at both firms approved the tie-up and recommended it to their partnerships for a vote, according to our archives. That's when things started to go bad. Several star Dewey partners bolted for other firms, including Covington & Burling and Weil, Gotshal & Manges, and Orrick began worrying that its target wasn't as appealing as it had been at first glance. That led Orrick to ask for an extra seat on the combined firm's executive committee, a move which would have given legacy Orrick partners a majority on that committee. Dewey bristled at that request, and at least one Dewey source told Legal Times that some partners at Dewey "perceived Orrick as a step down." There also were issues with Dewey's unfunded pension plan.
Orrick had previous dalliances with Coudert Brothers, Cooley, Venture Law Group, Donovan Leisure Newton & Irvine and Swidler Berlin Shereff Friedman
The upshot: Don't assume this Akin-Orrick merger is done until it's, you know, actually done.
Additional reporting by Nate Raymond.
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