Hogan Lovells and K&L Gates latest to target Australia market
Hogan Lovells and K&L Gates have joined the growing rank of US and transatlantic law firms planning tie-ups in Australia, as interest in the Asia-Pacific region continues to grow.
Hogan Lovells is assessing options, with a merger with a mid-tier Australian firm the preferred choice for many partners.
Asia and Middle East managing partner Crispin Rapinet and co-chief executive David Harris are involved in the discussions, which have seen the firm meet with local firms including Corrs Chambers Westgarth and Clayton Utz over the last few months.
While Clayton insists that the firm has never discussed a tie-up with Hogan Lovells and Corrs has denied any current merger talks, Hogan Lovells is still in discussions with several firms in Australia.
Rapinet said: “We have been expanding our Southeast Asian offering as part of our plans for growth in the Asia region and in that context have been closely monitoring the recent activity in the Australian market.”
He added: “In this respect, we have had informal meetings with a number of top Australian firms to help shape our view.”
K&L Gates, meanwhile, has been holding talks with several local firms, including mid-tier independent Middletons. A merger with the 70-partner firm would hand K&L Gates four domestic offices in Brisbane, Melbourne, Perth and Sydney with a full-service offering.
Other US or transatlantic firms planning to enter the market include Mayer Brown, which ended discussions with a local firm recently, and White & Case, which is considering its own launch in Australia or a semi-formal alliance with a domestic firm, after management ruled out a full merger earlier this year. Former London head of finance David Barwise relocated to Singapore last year to explore options.
News of the potential new entrants comes amid moves by a growing number of UK and US firms to enter the Australian market in recent years with Ashurst, Norton Rose, Clifford Chance and Allen & Overy all securing entry through a combination of mergers and local launches.
Herbert Smith is still in talks about a tie-up with Freehills, while Linklaters last month agreed a formal alliance with Slaughter and May’s former Australian best friend Allens.
Despite initial indications from both firms that the deal was not a precursor to a merger, Legal Week has learned that the agreement will last for an initial five-year period, at which point the firms will reassess the situation, with a merger one potential option at this stage.
One Linklaters partner said: “A full combination will be one option under consideration from 2017, depending on market conditions. The main reason for not agreeing a merger straight away was the difference in PEP as well as Allens’ large domestic practice.”
Deals such as Mallesons Stephen Jaques’ union with China’s King & Wood earlier this year mean Minter Ellison and Clayton Utz are the only two of Australia’s ‘big six’ still to pursue tie-ups with UK or international firms. Both have now confirmed to Legal Week that they are open to mergers.
By Friederike Heine, Suzi Ring.