Fulbright & Jaworski and U.K.-based Norton Rose are to combine next summer, creating a global giant that will rank among the world’s 10-largest law firms by revenue and attorney head count, the pair announced Wednesday.
The new firm, Norton Rose Fulbright, will boast 3,800 lawyers spread across 55 offices, and total revenues of around $2 billion. It would have ranked sixth in The American Lawyer’s 2012 Global 100 revenue rankings, ahead of Magic Circle firms Linklaters, Allen & Overy and Freshfields Bruckhaus Deringer.
The combined organization will be headed by Norton Rose group CEO Peter Martyr. Fulbright chair-elect Ken Stewart, who was appointed to replace incumbent Steve Pfeiffer in May, will serve as managing partner of the U.S. operations and will take a senior position on Norton Rose Fulbright’s global executive committee.
“This is the culmination of a process that started 18 months ago,” says Stewart. “We undertook a strategic review and realized that we needed to follow our clients’ needs into the global marketplace. We pretty quickly concluded that the best way of doing that was to find an international practice to merge with.”
Fulbright is the latest addition to Norton Rose’s rapidly expanding Swiss verein, which now comprises members in the United Kingdom, the United States, Australia, Canada and South Africa. (A verein is a Swiss-law holding structure, utilized by DLA Piper, Baker & McKenzie, and most other recent global tie-ups, that lets participating entities maintain their existing forms without integrating financially.)
Over the past three years, Norton Rose has embarked on a sustained merger spree that has transformed it from a faltering London-based practice into one of the world’s largest and fastest-growing firms.
It all started in 2009, when Norton Rose stunned the market by announcing a combination with Australian full-service practice Deacons—a move that kickstarted a flurry of international law firm activity within the country. (Allen & Overy, Ashurst, Clifford Chance, Herbert Smith and Linklaters all subsequently established operations in Australia.) Just over 12 months later, the firm generated more headlines by pulling off a three-way tie-up with Canada’s Ogilvy Renault and South Africa’s Deneys Reitz. Most recently, Norton Rose merged in January with another Canadian practice—250-lawyer oil and gas specialist Macleod Dixon.
The combination with Fulbright marks the end of Norton Rose’s longstanding search for a U.S. member to join the group.
In a feature profiling Norton Rose’s international expansion, The American Lawyer suggested that the “smart money” was on the firm ultimately merging with Fulbright.
The two firms have a working relationship that stretches back more than a decade—during a stint in the firm’s London office in the early 1980s, outgoing Fulbright chair Pfeiffer used to regularly refer litigation work to Norton Rose CEO Martyr—and according to four Norton Rose equity partners, even held tentative merger discussions in 2008. (Martyr denies this.)
As one of the market leaders in global oil and gas work, boasting close ties, for instance, to BP America Inc., Fulbright will further strengthen Norton Rose’s position within the mining and resources sectors, which has been one of the key focuses of its previous mergers. (Australia, Canada, and Africa are some of the hottest jurisdictions for major global resources deals.)
Fulbright also has a strong health care practice—partner Frederick Robinson is one of the industry’s eminent litigators—which syncs up with Norton Rose’s growing life sciences practice.
The combined entity will benefit from Fulbright’s huge disputes resolution practice and Norton Rose’s infrastructure and financial services expertise. There would also be little overlap in staffing. Ninety-five percent of Fulbright’s partnership is based in the firm’s 11 U.S. offices, and Norton Rose should easily be able to accommodate the American firm’s 24 City-based lawyers in its London premises. And despite the two firms collectively operating 60 offices, duplication occurs in just five locations: London, Hong Kong, Beijing, Munich and Dubai.
Martyr says that the firm is now looking to expand its presence in South America—Norton Rose already has outposts in Colombia and Venezuela—with Brazil its top priority.
“Brazil is clearly somewhere that we need to be,” says Martyr. “If you look at the way in which we’ve tried to connect geographies, and the types of businesses prevalent in those markets, Brazil is a very obvious match.”
The last few years have been challenging for Fulbright. The Houston-based firm has seen its headcount drop from 972 in 2006 to 810 last year. Fulbright’s gross revenues has fallen by almost $100 million since the start of the economic downturn—from $694.5 million in 2008 to $597.5 million last year.