Mergers Impact on Law Firms’ Attorney Attrition

Law firms often strengthen a practice area or expand into specific areas through mergers and acquisitions. Many would wonder what the impact on attorney retention post-merger is.

A recent Law360 article looked at the impact of attorney attrition due to M&A activities based on a comprehensive analysis of five years of data on Leopard Solutions’ Mergers and Acquisition tool. It focused on top law firm combinations between 2017 and 2021, starting with the Bur Forman & McNair merger to the more recent Holland & Knight and Thompson & Knight merger.

The analysis revealed a consistent trend: within four years of merging, these entities typically retain between 55% and 75% of lawyers from the acquired or target firms. This retention data, juxtaposed with lateral hiring attrition rates, suggests a comparable performance.?

The resurgence of law firm combinations, evidenced by 84 mergers announced in 2023, underscores the significance of such data in contemporary legal landscapes. Despite considerable attrition rates, consultants maintain that a successful merger hinges on achieving predetermined goals, whether geographical expansion or practice area diversification.?

The analysis looked deeper into the nuances of attrition. While some departures may reflect strategic pruning by the merged entity, others stem from personal preferences or conflicts.

Further data analysis of Leopard data revealed the importance of additional data that informs law firms’ growth strategies, suggesting that retention rates below 75% may warrant careful consideration before pursuing mergers. Such analysis can be conducted using Leopard BI (Business Intelligence).?

While the one view data offers valuable insights, it remains imperative for law firms to further weigh in various factors and motivations when contemplating mergers and conduct more rigorous due diligence analysis, underscoring the necessity for informed decision-making in an evolving legal landscape.?