Law firm mergers dip as economy recovers
22 July, 2015
An improvement to the UK’s economic position has led to a decline in the number of law firms merging, according to new data.
The new data showed that during 2014 there were 174 mergers in the UK legal sector, down from 196 in the previous year and a 30 per cent decline in mergers since 2011 (247).
The data, revealed in the Solicitors Regulation Authority’s (SRA’s) most recent report, also showed that there were 176 mergers in the year to the end of February 2015.
During this time, the total number of regulated firms remained steady – between 10,300 and 10,400 – following a gentle decline from 10,875 in June 2013.
A separate survey, commissioned by the Law Society Gazette, indicated that small firms are turning their strategic focus away from potential merger and toward profitability.
The poll, carried out by the Law Consultancy Network, showed that during the first two quarters of 2015, mergers remained a low priority; with just 60 per cent of firms saying that they were aiming for a merger in the coming year – the second lowest proportion of any half-year period in the last five years.
This is a clear indication that more firms are now seeking profitability over consolidation with another firm and shows that thanks to the recovery of the UK’s economy many practices feel financially stable enough to go it alone.
If you would like to know more about driving profitability within your firm or feel you may benefit more from a merger with another firm then our team of legal finance experts at Watson Buckle can help. For more information, please contact us.