A&O Surpass Their Major Rival, Clifford Chance
The top-earning law firm in London’s famed ‘Magic Circle’ is Allen & Overy, according to reports on the financial earnings of the major big law firms.
A&O is one of four magic circle law firms required to disclose financial details of their revenues and has eclipsed Clifford Chance as top earner of the magic circle firms with £2.08 billion ($USD2.65 billion).
Although impressive, the largest of the overall rankings in the City firms is DLAPiper, which sits with revenues of a shade under £3 billion mark.
However, according to research featured from The Lawyer, DLA Piper, an Anglo-American law firm, has managed to retain its position at the summit of the overall City revenue rankings, narrowly missing the £3 billion ($USD3.8 billion).
A&O saw an increase of more than 7 percent in fee income, according to researchers from The Lawyer website.
Securing the top position will undoubtedly provide added leverage to Allen & Overy’s London leadership during discussions with Shearman & Sterling regarding their planned merger with the New York-based firm.
The financial figures outlined in the report indicate that Clifford Chance also managed to exceed the £2 billion threshold, achieving a turnover of £2.06 billion, significantly ahead of the other two reporting members within this exclusive group.
Linklaters, with recorded revenue of £1.9 billion, and Freshfields Bruckhaus Deringer, the Anglo-German law practice, which logged £1.84 billion, complete the quartet of firms within the magic circle.
On Going Rise of Allen & Overy
Analysts noted that Allen & Overy’s rise to the apex has been steady since 2018, marking a remarkable journey. Just five years ago, the firm’s turnover trailed behind Clifford Chance by £60 million.
The merger of Allen Overy Shearman Sterling, will put the firm close to the top of the biggest and most prestigious law firms list but in London City terms it was DLA Piper that maintains its position at the forefront of the turnover table, the researchers underscored that the firm’s U.S. operations remain financially distinct from its UK and international offices.Britain’s Legal Industry Size
On a broader scale, the research unveiled that the combined fee income generated by the United Kingdom’s 50 largest law firms reached an all-time high of £30.8 billion ($USD39.2 billion) in the last financial year, showcasing a year-on-year surge of 8 percent.
Each of the top 50 firms achieved a turnover exceeding £100 million for the first time.
The top 50 roster introduced a new entrant, Browne Jacobson, who replaced Ince & Co. This replacement was necessitated by the buyout of the publicly floated legal services company, Ince Group, which was delisted from the London exchange after undergoing administration earlier this year.
The authors of the report highlighted the financial challenges faced by several prominent City law firms due to escalating wage expenses.
Amid these findings, certain firms experienced substantial setbacks over the past year.
Macfarlanes, a distinguished specialist in advising affluent individuals, saw a 6.5 percent decline in profit, reaching £134.9 million.
Similarly, Charles Russell Speechlys, another specialist in private client services, experienced a profit reduction of 7.3 percent, settling at £37.1 million.