Law firm A&O Shearman to trim partnership by 10% in post-merger cuts
06 Sep 2024
(Reuters) - Global law firm A&O Shearman is cutting 10% of its partnership and shutting down its Johannesburg office in a series of post-merger changes, the firm said on Friday.
London-founded Allen & Overy and New York-founded Shearman & Sterling completed a planned merger on May 1, launching the largest transatlantic law firm combination in years.
A&O Shearman, which has around 800 partners, said it will trim the global partnership by the end of its fiscal year in April 2025.
The firm said the change will reduce overlaps and position it to promote and hire partners in growth areas.
The predecessor firms said when they merged that A&O Shearman would have nearly 4,000 lawyers and 3,000 other employees across 47 offices, generating combined revenues of about $3.5 billion.
The post-merger changes announced on Friday also include the closure of the firm's Johannesburg office, which opened in 2014, by the end of 2024.
Its website lists 32 lawyers in Johannesburg who work on corporate and M&A, finance, tax and other matters. The firm said priorities have changed, but that it will continue to support clients in the region.
A&O Shearman will also shut down its consulting practice, which offers combined legal and advisory services.
"We never take decisions like this lightly, particularly when they affect our people," Hervé Ekué, managing partner of A&O Shearman, said in a Friday statement.
Ekué said the firm was confident about its future and called the changes a "difficult but necessary step forward."
Law firm consultants said firms often make cuts in connection with a merger, to manage overcapacity in certain practices or to trim underperforming partners.
"The significant amount of change that law firms experience as a byproduct of a major combination opens doors for them to pursue other changes, which can often be hard to accomplish in more of a steady state approach," said Kristin Stark, a principal at legal consultancy Fairfax Associates.