The merger agreement between Dewey Ballantine LLP and LeBoeuf, Lamb, Greene & MacRae LLP, while instantly creating one of the biggest firms in New York, speaks as much to the U.S. legal industry’s increasing emphasis on accelerating international growth.
The combined firm will be known as Dewey & LeBoeuf LLP and have more than 1,300 attorneys and annual revenue approaching $1 billion. Steven Davis, LeBoeuf’s chairman, will lead the new firm. The merger, which was agreed to late Friday, is expected to take effect Oct. 1, with the firms’ partnerships voting on the deal in the coming weeks.
While law-firm mergers have become commonplace, combinations among the nation’s largest firms occur infrequently, and marriages involving top New York law firms are rarer still. Profits-per-partner at the two firms are virtually identical. In 2006, Dewey partners earned an average of $1.45 million; LeBoeuf’s made $1.43 million, according to the American Lawyer magazine.
In an interview yesterday at Dewey’s midtown Manhattan offices, both Mr. Davis and Morton Pierce, Dewey’s co-chairman, cited the increasing globalization of the legal market as an important reason for the combination. Though the firms already have sizable presences outside the U.S. — 38% of Dewey’s lawyers and 35% of LeBoeuf’s attorneys are based abroad — the deal allows the firms to accelerate their international expansion, they said.
“We’re seeing world-class companies coming out of emerging markets,” said Mr. Davis, citing as examples Russian aluminum giant United Co. Rusal and China National Petroleum Co., both LeBoeuf clients. “You can’t handle matters for companies like these being small. You have to be bigger, and I don’t see how you can reasonably expect to service them without being out where they are.”
This is Dewey’s second trip to the altar in less than a year. Last October, Dewey and San Francisco-based Orrick, Herrington & Sutcliffe LLP approved the main terms of a merger, but a definitive agreement was never reached and the deal fell apart in January. Numerous partners left Dewey in the wake of its talks with Orrick, though the firm has since added a roughly equal number of partners.
In late spring, Mr. Davis, who joined LeBoeuf out of law school in 1977, approached Mr. Pierce about a potential combination. Merger talks began in earnest about six weeks ago.