Latest Talks Reflect Law Firms’ Mega-Merger Trend
It may be merger time again in the Minnesota legal community.
Officials at Minneapolis-based law firms Lindquist & Vennum, a 175-attorney outfit, and Oppenheimer Wolff & Donnelly, which has 90 attorneys, have confirmed that they are in talks to merge. The negotiations have been described as preliminary and are expected to continue throughout the summer. Such a combination would create the third-largest law firm in town, based specifically on the number of Minnesota attorneys.
The deal would mark the fourth significant merger in the legal community in the past few years. In 2012, Faegre & Benson joined with Indianapolis-based Baker Daniels. Last October, Leonard Street & Deinard combined with Kansas City firm Stinson Morrison Hecker. And last November, TCB broke the story that Mackall Crounse & Moore was merging with Milwaukee-based firm Dewitt, Ross & Stevens, to form Dewitt Mackall Crounse & Moore.
This potential deal feels different. Unlike the others, it would involve two Twin Cities firms joining together, instead of a local firm teaming with a bigger outsider. And for the most part, this combination would result in a deepening of combined services rather than a broadening, since the two firms do much of the same thing—namely, corporate finance and business litigation.
Spokespeople for the two firms declined to give further comment on the talks at this time. But there would be some enhanced offerings a united firm could offer clients, and that must seem attractive to the parties, according to Roy S. Ginsburg, a legal consultant in the Twin Cities.
“It would make sense to me if what’s driving it is to fill gaps in practice areas,” Ginsburg told TCB. “If it’s to take a 20-lawyer M&A group and make it 45, or grow a litigation group from 25 to 75, I’m not sure how that benefits anybody.”
But the trend both nationally and locally is to go bigger or go home, with the thinking being that clients want to go with full-service firms these days. However, Ginsburg—who has practiced for more than 30 years in the Twin Cities with major local firms Dorsey & Whitney and Henson & Efron, and also as associate general counsel at Merrill Corporation—isn’t convinced bigger is always better.
“The jury is still out with a lot of these mergers,” he says. “What can happen if you’re not careful is the cultures don’t mesh and then things can fall apart. Culture is so important.”
Being that Lindquist & Vennum and Oppenheimer Wolff & Donnelly are both Minneapolis firms, a culture clash seems less likely, although that remains to be seen. What is known is that it takes a lot of work to pull off a merger of this size. For that reason Ginsburg is assuming the disclosed merger talks are serious.
“I would assume so because it takes a lot of time away from billable hours to engage in talks like this,” he says. “In theory, that’s time the firm could be using to do basic business development. But again, this is the trend. Not everyone is convinced this is the way to go but a lot of people think it is.”