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Stroock & Stroock & Lavan, a distinguished law firm with its origins in New York, appears to be on the cusp of shedding its pension obligations—a strategic move that could pave the way for a seamless merger. The law firm’s Co-managing partner, Alan Klinger, disclosed that Stroock’s partnership has given the green light to a comprehensive pension buyout. The proposed buyout, however, hinges on the consent of the firm’s retired partners, a process that is currently underway.
With optimism, Klinger stated, “We are optimistic about its success.” The critical deadline for the vote on the buyout is set for August 8. Yet, the specific percentage of retired partners needed to approve the pension buyout plan has not been disclosed, as a spokesperson from Stroock declined to comment on this matter.
Klinger expressed his gratitude to the retiree community, acknowledging their understanding of the firm’s need for this strategic shift. By embracing the pension buyout, Stroock aims to eliminate a significant hurdle in its pursuit of forging a desirable merger. Klinger emphasized, “This will remove a major obstacle to us accomplishing a desired combination.”
See also: Stroock Sees Latest Departures as Partners Join Bracewell
The financial magnitude of the pension currently stands at approximately $6 million annually, according to a firm spokesperson. The pension’s peak value reached slightly over $8 million annually.
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Pension obligations are renowned for their potential to complicate discussions surrounding law firm mergers. By addressing this matter proactively, Stroock & Stroock & Lavan seeks to bolster its position in merger negotiations, demonstrating its commitment to a smooth transition.
Reports have circulated that Stroock has engaged in discussions about potential mergers with multiple law firms, dating back to the previous year. Notably, the firm faced a setback when it lost a group of 43 restructuring lawyers to Paul Hastings. In recent times, Stroock was engaged in merger talks with Nixon Peabody, a law firm rooted in Boston. However, negotiations between the two firms were terminated last month. Despite this setback, Stroock has affirmed that it continues to explore merger possibilities with various other firms.
Amidst these developments, the firm has experienced a series of partner departures throughout the year. Several teams of lawyers, spanning various practice areas, have defected to rival firms. A notable example includes a team of 27 lawyers who recently joined the ranks of Steptoe & Johnson LLP.
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