By Javier C. Hernandez
Two international law firms are in high-level merger talks in a move that would create a behemoth with 2,500 lawyers, an individual with knowledge of the discussions said on Wednesday. Together, the two firms - Hogan & Hartson, based in Washington, and Lovells, in London - hope to capitalize on international litigation as investors turn to emerging markets.
The leaders of each firm were expected to meet with their management committees this week. The combined company would probably be one of the top 10 law firms in the world, with joint revenue of nearly $2 billion.
A merger would have to be approved by partners at Hogan and Lovells at meetings in December. The person with knowledge of the deal spoke only under anonymity, saying that discussions were continuing and could still collapse.
The companies have been in talks for two years, this person said, under the belief that the market for cross-border legal services is growing as investors throw capital into foreign markets like Russia, Brazil and India.
Representatives from both firms did not return calls seeking comment.
Hogan currently has 14 offices outside of the United States, while Lovells has 26. In Asia, an important market, Lovells has offices in nine cities and Hogan has locations in five.
A considerable challenge in the proposed merger, which was first reported by the online edition of The Wall Street Journal, is reconciling the two firms' compensation systems. At Lovells, lawyers are paid primarily based on seniority, as they are in many European firms. Hogan pays largely based on performance.
In 2009, Hogan was ranked the 58th-largest firm in the United States by American Lawyer magazine, based on its number of partners and profit per partner.
