Posted by: Emma Jackson
Jones Lang LaSalle EMEA Research
As the campaign trail starts to heat up in the US, the faltering economic recovery and high unemployment rate are not giving Barack Obama too much to smile about. His approval ratings have been declining steadily since entering office and now his prospects for a second term are very much in the balance.
As a former attorney though, I am convinced that he would be impressed by the recent expansion activity of a number of US law firms in the City of London. The annual Legal Week survey of international firms in London indicates a shift in City ambitions from US law firms, but a more mixed outlook for non-US international law firms in London. US law firms in London, for the most part are increasing headcount and pursuing expansion plans, some of them at a faster pace than previous entrants who favoured slower, steady growth.
A selection of recent activity includes:
- Locke Lord opened its London ‘start-up’ in February this year. Initially launching with nine lawyers. Headcount rose to 30 by the end of May and they are hoping to get to 40 by the end of the year.
- Boston firm, Goodwin Procter has been expanding. It is thought that the firm’s headcount could grow to 15 by year end and about 40 in three years’ time.
- In March, Goldberg Segalla announced expansion plans –with the opening of an office located in the heart of London’s finance and insurance district at No. 1 Cornhill, across from the Royal Exchange.
- Established firms to see dramatic growth over 2011 included Dechert, which added 33 lawyers during the financial year, and White & Case, which added a total of 10 partners in London. Kirkland & Ellis and Latham – already established in London and Europe – have increased their lawyers by 28 and 25 respectively.
Globalisation is increasingly driving law firm strategy as many of their clients are now recognising greater opportunities outside the US. Increasingly firms are becoming convinced that playing it safe may mean missing out. Instead, they are considering more aggressive growth, with 13 out of 63 law firms responding to Legal Week’s annual survey admitting that they would consider a UK merger – approximately double the usual number.
A merger with a UK based company can help firms achieve greater scale and geographical coverage quickly and relatively cheaply. Big American companies such as Mayer Brown, K&L Gates and Reed Smith all moved into London by taking over established City firms.
So, will their campaign ultimately lead to a successful outcome in the future? Like Barack Obama – we will have to wait and see.
For those interested in the legal sector, look out for our forthcoming Global Law firm report and UK Legal Sector digest.