Law firm mergers are continuing apace in the UK legal market as trends towards consolidation continue.
While some firms are looking for a ‘take out’ by a so-called white knight, others are looking for partnerships
with other firms in a market that is becoming more competitive.
Figures indicate that the number of mergers has increased by 65 per cent in the past year in the UK, with 385
firms merging. This is up from just 146 mergers five years earlier.
Accountancy firm Wilkins Kennedy compiled the figures, indicating that there is an increasing appetite for firms
to increase profitability and beat off competitors by buying smaller practices.
“These figures show that the rising trend for merges shows no signs of slowing down,” Wilkins Kennedy partner
Tommy White says. “As financial pressures, increased competition and to a perhaps lesser extent regulatory
issues are still having a major impact. M&A, corporate finance and property work for lawyers, still below the heady days of
“In addition the long term, secular decline in litigation work continues, despite a helping hand
from recession-linked disputes.”
He also ponts out that various factors are pressuring smaller firms in particular, including the
dumping of referral fees for personal injury cases, legal aid and Conditional Fee Arrangement changes, as
well as new rules permitting non-law firm or alternative business structures to provide legal services.
Criminal legal aid reforms have not helped either, with final cuts announced earlier this year.