While the legal market is never short of speculation about the next potential merger, last month saw news of an eye-catching deal bringing two parties from very different markets together with a fresh approach.
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Merger talks between Womble Bond Dickinson (WBD) and BDB Pitmans have been called off, the firms announced on Wednesday (1 February) in a joint statement.
Talks of a combination first became public in October 2022, when a story on RollOnFriday prompted WBD and BDB Pitmans to confirm that they were in discussions around a potential merger, albeit early stage.
In the new statement, the firms said: ‘Womble Bond Dickinson and BDB Pitmans announce today that they have decided not to proceed further with their proposed merger. After extensive discussions on the combined proposition, both firms have decided that the best path forward is to remain independent of each other. Excellent relationships have been established and the firms will continue to work closely together in the future.’
No details were given as to why the talks fell over.
As Legal 500 data from late last year revealed, the two firms complemented each other in some notable ways. A combination offered Pitmans access to the US market, while WBD would have expanded its offering in the UK. In particular, WBD has little presence in the southeast and east of the country, while Pitmans is active in Southampton, Reading, and, since acquiring King & Wood Mallesons (KWM)’s office there in 2017, in Cambridge. The two firms also share strengths in real estate, particularly planning, and in private client work.
But, as with any proposed merger, there were always going to be disparities. First, while WBD has offices in the UK and the US, Pitmans has no presence outside the UK. Second, and more significant, there is a gulf between the two firms in terms of both headcount and turnover. WBD employs 888 lawyers, including 218 equity partners and 171 non-equity partners, with a total revenue in 2021-22 of £379m. Pitmans, by contrast, posted revenues of £53.3m, and is home to 235 lawyers, with 50 equity partners and 20 non-equity partners. Moreover, Pitmans’ revenues slumped 3% in the 2021-22 financial year, while WBD’s increased by 2%.
All this means that the proposed merger made sense: a combination firm would have had a top line of over £430m, and over £160m in the UK alone. But it also highlights that any eventual union would not have been one of equals.
A merger is, of course, a major upheaval for both firms involved. Even early-stage talks can be all it takes to upset the applecart and send partners searching for pastures new. A case in point is the ongoing exodus from Shearman & Sterling amid rumours of an upcoming tie-up with Hogan Lovells. Neither WBD nor Pitmans is a stranger to this process. WBD was established in 2017 when US firm Womble Carlyle Sandridge & Rice joined with UK-based Bond Dickinson, and Pitmans in its current form is the product of the 2018 union of Bircham Dyson Bell and Pitmans. But it may be that, especially in the context of reduced dealmaking on both sides of the Atlantic, both firms opted for the stability of the known over the risks of the unknown.
Womble Bond Dickinson (WBD) and BDB Pitmans are continuing to pursue a strategy of development through consolidation, having confirmed they are in talks over a potential merger.
After RollOnFriday broke the news of the merger talks today (21 October), the firms said in a joint statement: ‘Leading transatlantic law firm Womble Bond Dickinson and leading UK firm BDB Pitmans confirm that they are in early discussions around a potential merger. Both firms regularly review opportunities to advance the best interests of their clients and their respective firms. Womble Bond Dickinson and BDB Pitmans are focused on where they see the greatest opportunities for a merged business, including those offered by complementary practice areas and office locations.
‘As discussions are ongoing, both firms have no further information to share at this time.’
Staff at both firms are well acquainted with the merger process, given their respective strategies in recent years. WBD in its current form was established in 2017, when national firm Bond Dickinson (itself the result of the 2013 union of Dickinson Dees and Bond Pearce) joined up with its US strategic ally Womble Carlyle Sandridge & Rice. A year later, partners of Bircham Dyson Bell and Pitmans voted for a £50m merger and move to an alternative business structure, establishing BDB Pitmans in its current form.
Any deal that is struck would not represent a merger of equals, given the disparity in size between the two firms. With offices both sides of the Atlantic, WBD’s latest revenue figure reached £379m after a 2% increase, while UK-only Pitmans’ came in at £53.3m following a 3% fall. The benefit to WBD is likely to come from the boost a tie-up would have on its UK business, which this year generated £113.8m. For Pitmans, a merger would grant access to a network of US offices previously unavailable to the national firm.
