These are tough times for another house that Stanley Berwin built, with exhibit B being the acrimonious end of merger talks between Berwin Leighton Paisner (BLP) and Greenberg Traurig. While the practice fit between the two looked both convincing and distinctive, these were two firms with plenty of strong characters.
Summing up the prospect of the proposed deal recently, Legal Business noted that proceeding with a union would be holding ‘the proverbial tiger by the tail’. So it quickly proved, as on 16 March the pair officially called time on the discussions amid some discontent from the US firm, which was unhappy at the messages being put out by BLP at the end of the talks.
It was the US firm that walked away, in part because it saw the merger as too heavily weighted towards real estate, but there was a more personal breakdown in chemistry as well. This dynamic was amplified in a 538-word statement issued by Greenberg’s executive chair Richard Rosenbaum, which aside from noting that ‘culture eats strategy for breakfast’ drowned its former suitor in faint praise beyond some warm words for BLP’s real estate team.
The US firm subsequently indicated it was generally unimpressed with BLP’s management and handling of the talks. It was a substantial break from the well-established protocols for bland post-talks flannel law firms usually adhere to. But given the iconoclastic, thrusting style for which Greenberg is well known, such an outcome was hardly a shock.
The bigger issue for BLP is where to go from here. Not because merger talks with one suitor went nowhere – that’s just business – but because the firm has committed itself to a real estate-heavy strategy that looks very hard to execute without a US merger and because BLP is still an institution uncomfortable in its skin.
What was once one of the most assured mid-tier players in the City – indeed, through the 2000s BLP was one of the most influential law firms outside the Magic Circle – has been beset by conflicting views and factions since its troubled 2012/13 year. The use of guaranteed pay deals for lateral hires has now taken on a symbolic weight beyond all proportion to its historic use at the firm for those who see the tactic as evidence of an ‘us and them’ culture.
While financial performance has more than stabilised in the last two years, it’s not apparent that has been enough to heal its divisions or how credible it is to regroup around real estate once again after more than a decade of talking up its transactional business.
BLP has a lot going for it still but so do many other major UK law firms that have spent the last ten years drifting unhappily. BLP made its reputation by standing out during the 2000s against a backdrop of underwhelming City peers.
It is now competing against a range of mid-pack players that are some of the strongest performers in the UK. It will need to find a message to galvanise the whole firm.