Law giants Hogan Lovells and Shearman & Sterling have hinted a potential merger could be on the table, after stating they are open to opportunities including “discussions with different firms”.
The two law firms both acknowledged market rumours they are engaged in early stage talks for a merger that could see them create the fifth largest law firm in the world.
Anglo-American firm Hogan Lovells is currently the 12th largest law firm by revenues, according to figures from The American Lawyer, while Shearman & Sterling is 61st largest firm.
A merger between Hogan Lovells and Shearman & Sterling would in turn create a firm with around 3,450 lawyers worldwide.
On being approached by City A.M. a Hogan Lovells spokesperson said the firm “regularly” reviews “opportunities that we believe may be available to us, and that includes discussions with different firms.”
A spokesperson for Shearman & Sterling made similar comments, stating “we continuously consider the various levers of growth that are accessible to us… these include both internal and external opportunities that would benefit our firm and our clients.”
The market rumours come amid speculation 2023 could see a major uptick in legal sector M&A activity, as firms seek to expand in the global economic downturn.
As set out in its most recent results, Hogan Lovells in 2021 posted annual revenues of $2.606bn, generating profit per equity partner (PEP) payouts of $2.48m each.
In its most recent results, New York firm Shearman & Sterling posted revenues of $1.01bn and PEP payouts to partners of more than $3m each.