February 3, 2012 11:08 AM
Herbert Smith Confirms Merger Talks with Freehills
Posted by Ed Shanahan
U.K. firm Herbert Smith confirmed Friday that it is in discussions with Australian firm Freehills about a possible tie-up, sibling publication The Asian Lawyer reports. A deal between the two would create a firm of some 2,000 lawyers and be the latest in a wave of mergers involving Australian and international firms.
"Herbert Smith is holding exploratory discussions with Australian firm Freehills about a possible linkup," spokesman Tom Rose told The Asian Lawyer's Jessica Seah. "Talks are still in the early stages."
A source at London-based Herbert Smith told Seah the possibility of a combination will be discussed further early next week when Freehills partners attend meetings in the U.K. firm's Hong Kong and London offices. If the firms decide to proceed, a vote would be planned for late summer, the source told Seah.
A tie-up between the two firms would create an international giant with nearly 2,000 lawyers, The Asian Lawyer notes. Freehills had gross revenue of $471 million and profits per partner of $970,000 in 2010, according to The American Lawyer's most recent Global 100 report. Herbert Smith's gross revenues in 2010 stood at $718.5 million and its profits per partner were $1.36 million.
A deal with Herbert Smith would give Freehills greater access to Asian markets, according to The Asian Lawyer. In addition to its Hong Kong outpost, the U.K. firm has offices in Beijing, Shanghai, Bangkok, Tokyo, and Singapore. Freehills, which has slower to expand into Asia than Australian rivals like Mallesons Stephen Jaques, only has a Singapore office outside of Australia. Freehills has so far mainly pursued Asian business through alliances with China’s TransAsia Lawyers, Indonesia’s Soemadipradja & Taher, and Vietnam’s Frasers Law Company.
In an October 2009 feature in The American Lawyer, Freehills chief executive partner Gavin Bell explained that Australian firms faced greater risks than their U.S. and U.K. counterparts in expanding in Asia due to their smaller natural client base.
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