Firms Push Ahead with Full Mergers Despite Aussie Slowdown
But overall strategy has also led firms to abandon long-held business models. The former Mallesons Stephen Jaques, which previously discussed a merger with Clifford Chance, had no option for a full merger with China’s King & Wood. Regardless of the economics, such a deal would have been illegal under Chinese law, which foreign firms are forbidden to practice.
The Australian firm ultimately decided that being able to put forward a different kind of brand in the market was worth adopting a verein.
King & Wood Mallesons Australia chairman Stephen Minns says the firm hasn’t lost sleep over it.
“You can burn up a lot of energy on internal matters,” he says. “And so in a sense the benefit of a verein structure is that you pull the firms together, you have one name, you have one brand, you focus on building the pie and building the practice, and you focus less on the structural and remuneration issues.”
Minns says he’s not necessarily arguing that a verein is better than a more traditional structure, but he doesn’t think it hurts in terms of getting business.
“Clients tend not to be interested in how we sort ourselves out,” he says.