We’ve seen this story before. A firm experiences a dip in profitability, then starts losing key partners (or reverse the order if you like; falling profits and defecting partners go hand in hand). Worried about its survival, the firm starts seeking out a white knight, in the form of a merger partner. And then….
Well, that depends. Sometimes a merger partner is found and the combined firms live happily ever after. Sometimes a merger partner is found and the combined firms suffer together, with the weaker firm effectively giving the stronger firm the “cooties.” And sometimes no merger partner is found at all; the troubled firm goes down, and rival firms swoop in like vultures to pick off the top practices and rainmakers. We can all think of examples of each scenario.
What will happen to Patton Boggs, the troubled law firm plagued by plummeting profits, fleeing partners, and layoffs galore? It’s too early to tell. Right now we’re at the stage of the firm casting about for someone to merge with. Who is the firm’s latest love interest?
Then Patton Boggs explored combining with some unnamed New York firm, as well as with a firm we’ll call “Austin Powers” — some international man of mystery, an unnamed firm based outside the United States. Those talks went nowhere.
Which brings us to today’s news, reported by Jennifer Smith of the Wall Street Journal (which, by the way, made Patton Boggs the poster child for troubled law firms in this morning’s paper). From the WSJ Law Blog:
Washington, D.C., law firm Patton Boggs LLP is in merger talks with a larger firm, Squire Sanders, over a potential tie-up that could create a roughly 1,700-lawyer global entity with offices in 19 countries.
The discussions are in early stages, according to a joint statement the firms issued on Wednesday. A combination, should both sides agree to proceed, could shore up the bottom line of Patton Boggs, which is under growing strain amid a firm-wide overhaul, and expand its international reach while lending Squire Sanders significant heft in Washington.
I’m reminded of John Quinn’s infamous tweet about Squire Sanders’s earlier merger with Hammonds. But in fairness to Squire Sanders, the merger took effect at the start of 2011, and the firm seems to be doing just fine today. As noted by the WSJ, Squire Sanders “has been on a bit of an expansionist tear in Asia, opening up offices in Singapore, Seoul, South Korea and Sydney in 2012.”
If Squire Sanders is doing so well, why would it want to hook up with Patton Boggs? If Squire Sanders isn’t careful, it could wind up feeling a certain burning sensation.
Will Squire Sanders merge with Patton Boggs? Or will Squire Sanders just pick up selected practices and partners, leaving Patton Boggs as a whole at the altar? This is, as you will recall, just what Patton Boggs did to now-defunct Dewey & LeBoeuf: Patton Boggs toyed with the idea of a full-on merger, but ultimately just took the pieces of Dewey that it wanted.
All is fair in love and war — and the combination of the two that we call law firm merger mania. If you have information or opinion to share about Patton Boggs, Squire Sanders, or the proposed combination of these firms, please feel free to email us or text us (646-820-8477).
Patton Boggs and Squire Sanders Are in Merger Talks [WSJ Law Blog]
Patton Boggs in talks with global firm Squire Sanders [Reuters]
Patton Boggs in preliminary talks to merge with Squire Sanders [Capital Business / Washington Post]
Earlier: Is The Patton Boggs ‘Forest Fire’ Burning Out Of Control?
Can Patton Boggs Escape From The Swamp?
Patton Boggs and Locke Lord May Be Eyeing Merger
Tweet of the Day: John Quinn on a Possible Squire Sanders / Hammonds Merger
Law Firm Merger Mania: Squire Sanders and Hammonds Tie the Transatlantic Knot