Research shows that there were 174 mergers between law firms in the UK in 2014. Whilst the total number of mergers has fallen by 11%, many are now being driven by plans for growth rather to cut costs, as the profession looks to take advantage of increased workloads.
The latest figure is down by 30% from 2011, but the figures reflect the fact that as the economy recovers, fewer firms are being forced to merge ‘defensively’ to cut costs and restore profit margins, as they did during the recession. Many are now merging out of choice, rather than necessity, which is great news for the profession.
The economic recovery means that M&A is now increasingly being used by firms as part of their growth strategies. Many mergers are now seen as a means to expand service offerings, enter new markets and to extend geographical reach. Law firms know that if they want to pick up bigger ticket work, such as larger M&A for example, they have to field a larger, more specialist team.
Our Managing Director, Peter Alderson says that one of the best ways of achieving the ambition to grow in a new sector or service line can be to merge with a firm that has an existing pipeline of work there.
LDF are able to fund a broad range of merged associated expenditures including tax, office re-location, refurbishment and IT software updates.
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