Altman Weil, a legal consulting firm in Newtown Square, released data from a survey on Monday that said 60 mergers involving United States law firms occurred in 2012, with many of them from Philadelphia, according to the Philadelphia Inquirer.
Mergers across the country and in the Philadelphia region continued at a decent pace as law firms tried to offset tepid business development by acquiring practices and clients. The merger pace in 2012 equaled the pace of mergers and acquisitions from 2011.
One of the mergers in Philadelphia include Center City’s Pepper Hamilton L.L.P. and the firm from Wilmington run by former FBI Director Louis J. Freeh. That merger took place back in August. Pepper added the 12 lawyers from Freeh’s firm. Pepper has over 500 lawyers employed.
“We’ve now seen nine straight quarters of steady deal-making since the legal industry shook off the worst effects of the recession,” said Ward Bower, an analyst at Altman Weil.
Bower said that on the surface, the merger market shows some type of recovery in the legal industry, but it also shows continuing economic pressures that will continue to intensify. Mergers occur because law firms simply want to open an office in a city where the firm being acquired already has a client-base. Another reason is that firms are just looking to expand, and the only way to do so in a struggling economy is to merge and acquire another firm.
Bower said that he is expecting smaller law school classes and some law schools disappearing as law firms struggle with an abundance of lawyers. Despite all of the reductions, Bower said that firms are growing using mergers and acquisitions because they represent good economic sense.
Another Philadelphia merger involved the Center City construction law firm of Cohen Seglias Pallas Greenhall & Furman P.C. The firm merged with a construction law firm from Manhattan, with the merger taking effect on January 1, 2013. A phone call from a recruiter led to the merger, according to firm partner Edward Seglias.
The Philadelphia firm merged with Georgoulis & Associates P.L.L.C. and the senior partner at Georgoulis was hoping a merger would relieve him of his firm’s administrative burdens. Cohen Seglias was looking for an office in New York, which is why the Philadelphia firm wanted the merger. The reason for this is that the Philadelphia firm has clients that do business in the New York region.
“People will do projects as they need to do them,” Seglias said. “I don’t know that anyone is sticking their neck out.”