Merger PHOTO

Berwin Leighton Paisner and Bryan Cave to merge in April

Two legal firms will form a global brand with revenues of more than $900 million. Their Asian coverage will expand.

Berwin Leighton Paisner and Bryan Cave will combine as Bryan Cave Leighton Paisner in April 2018, according to a statement from the firms.

The new entity will have an international practice and sector teams in 32 offices across 11 countries and approximately 1,600 lawyers, and will be led by co-chairs Therese Pritchard and Lisa Mayhew.

In Asia, Bryan Cave Leighton Paisner will have a greater presence than they had so far. The reach of the two firms will extend with offices in Beijing, Hong Kong, Shanghai, and Singapore.

Mobile-based Hand Arendall merging with Panhandle law firm

Alabama law firm Hand Arendall has announced a merger with Florida Panhandle firm Harrison Sale McCloy, creating a new regional firm to be known as Hand Arendall Harrison Sale LLC.

Hand Arendall announced the agreement Wednesday and said it would be effective Jan. 1. Hand Arendall Harrison Sale will have about 85 lawyers, with Alabama offices in Mobile, Birmingham, Fairhope and Athens and Florida offices in Panama City, Destin and Santa Rosa Beach.

According to information provided by the new company, Harrison Sale McCloy founding partner Franklin Harrison will serve as managing lawyer for Florida. Hand Arendall’s managing lawyer, Roger Bates, has been named managing lawyer for the new firm.

Hand Arendall was founded in Mobile in 1941 and has offered services “in all areas of traditional civil practice,” according to company information. Harrison Sale McCloy was founded in 1983 and likewise handles a broad spectrum of legal matters.

According to information released by Hand Arendall Harrison Sale, talks between the two firms began in early 2017.

“In a dynamic and ever developing legal industry, we made a strategic decision to continue to expand westward from our original office in Panama City four years ago,” said Franklin Harrison. “Hand Arendall was strategically exploring an eastward expansion along the Gulf Coast.  After initial meetings and several interviews, we decided to team with Hand Arendall forming a new firm of Hand Arendall Harrison Sale.  It is an exciting next step in the strategic growth plan of both firms.”

Zurich acquires ANZ’s life insurance business for $2.2bn

Zurich Insurance Group AG’s decision to acquire the life-insurance businesses of Australia & New Zealand Banking Group Ltd. should help Switzerland’s biggest insurer fulfill its ambition to increase its dividend.

Already famous as a dividend stock, Zurich signaled last month that it wanted to boost payouts to investors. The A$2.85 billion ($2.2 billion) deal for OnePath Life will be earnings-accretive from the start and increase the firm’s return on equity, the Swiss company said on Monday — potentially helping Chief Executive Officer Mario Greco realize his goal.

“As ever with Zurich, the focus will be on the impact on the dividend,” said Paul De’Ath, an analyst at RBC Capital Markets in London. “The potential to grow the ordinary dividend is only enhanced by this transaction. There could be scope to fund this transaction and also leave room for special dividends, should Zurich decide this is the best use of capital.”

Zurich Insurance has been restructuring under Greco, who has sold assets, cut jobs and lowered the insurer’s risk profile after losses in its North American auto business prompted the company to abandon a high-profile takeover bid for RSA Insurance Group Plc.

The Swiss insurer has also been on an acquisition spree: as well as the ANZ deal, it agreed to buy Macquarie Group’s life unit in March 2016, the same month Greco started as CEO, and took over Australian travel insurer Cover-More Group Ltd. earlier this year.

‘Expanding Business’

“It’s positive to see Zurich continue to expand its life business,” Intelligence analyst Charles Graham said. “The deal builds on their strength in bancassurance and is consistent with the group’s focus.”

Greco said on Nov. 15 that he’s confident that improving performance will allow Zurich to “increase returns to our shareholders.” At the time the company confirmed it would maintain a minimum dividend of 17 Swiss francs a share.

In his statement on the latest deal, the CEO said the acquisition will “support dividend growth beyond that implied by our existing plan.” The OnePath Life portfolio “provides a highly cash-generative business that will add to our cash remittances” and increase Zurich’s business operating profit after tax return on equity, or BOPAT ROE, target by 50 basis points, Greco said.

A spokesman for Zurich said that December is not the right time to talk about dividends.

‘Cash Generative’

“We see this acquisition as a welcome cash generative add-on for the Zurich group, somewhat lowering future earnings volatility and improving the group’s diversification and dividend-paying profile,” Stefan Schuermann, an analyst at Vontobel, said in a note. He confirmed his firm’s hold rating on the stock.

The deal is expected to close by the end of next year and will make the firm the largest retail life insurer in Australia, with a market share of about 19 percent.

Zurich will use a mixture of cash and senior debt to fund the purchase, which will have a “modest” effect on the company’s capital position, according to its statement. OnePath Life had net earned premiums of $1.1 billion in the 12 months through September and a net profit after tax of $142 million. The strong cash flows will support future dividend growth, according to the statement.

As part of the deal, Zurich will enter into a 20-year distribution agreement with ANZ in Australia to distribute life-insurance products through bank channels. That gives the insurer access to six million potential customers.

Zurich’s shares were little changed as of 2:15 p.m. in the Swiss city, while ANZ rose 1.1 percent in Sydney trading.

For ANZ, the deal makes the bank the latest of Australia’s biggest lenders to exit the life-insurance industry, which has been hit by rising claims, anemic investment returns and policy cancellations. National Australia Bank Ltd. sold 80 percent of its life unit to Nippon Life Insurance Co. for A$2.4 billion in 2015, and Commonwealth Bank of Australia agreed to sell its life-insurance arm to AIA Group Ltd. for A$3.8 billion in September.

“ANZ’s portfolio of non-traditional and profitable retail products fits well with Zurich’s strategy to focus on capital-light protection and unit-linked business,” Greco said. “Furthermore, it strengthens the group’s position in Asia Pacific, while building on our strong bank distribution capabilities.”

Law firm Lindsays to merge with Aitken Nairn

Law firm Lindsays has announced a merger with long-established Edinburgh solicitors Aitken Nairn.

The merger, which is due to take place on 22 January, will see Aitken Nairn partners Kenneth Stanley and Morag Yellowlees join Lindsays, along with 15 members of staff.

The merged firm will be known as Lindsays.

Lindsays operates from offices in Edinburgh, Glasgow, Dundee and North Berwick.

Managing partner Alasdair Cummings said: “We are delighted with this merger.

“Aitken Nairn WS has an excellent reputation, in particular in residential property and the services it offers to individuals and families.

“We look forward to welcoming Morag, Kenneth and their colleagues to our full service team.”

Law firms agree £30m revenue target after merger

Two southeast firms have merged to form a practice with a combined headcount of 225 people and £20m annual turnover.

Illiffes Booth Bennett Solicitors (IBB Solicitors) has brought its 17 specialist practice areas together with full service firm Turbervilles Solicitors.

The deal was completed last week and the new firm will go under the name IBB Solicitors. All Turbervilles employees and the firm’s five partners will move to IBB’s offices in Uxbridge, north west London. The merged firm will be led by managing partner Joanna DeBiase with Turbervilles’ former managing partner, Russell Hallam, joining the IBB leadership team from January 2018.

DeBiase said: ‘Since developing our long-term vision in 2016, we have been looking at ways to make our firm more resilient. Mergers are one of the ways to achieve growth as long as both firms share the same culture and values.

‘At the core, both of our firm’s philosophies have always been about listening to our clients to get a really good understanding of how we can help them.’

The combined firm now aims to grow revenue to £30m by 2023 through the joining of practices working in different sectors.

IBB Solicitors has a clientbase including Aviva, Xerox (UK) and Bellway plc, while Turbervilles’ clients include National Caravan Council, Symrise Limited, WMF UK Ltd and Parexel International.

Hallam added: ‘Like IBB, we were keen to find a partner to boost our service offering to our clients who are mostly based in West London and the surrounding regions.

‘I am in no doubt that our clients will benefit from the combined and distinctive service offering now that two firms have become one.’


Berwin Leighton Paisner (BLP) and Bryan Cave enter merger talks

Berwin Leighton Paisner (BLP) and Bryan Cave have entered into preliminary merger negotiations.

BLP managing partner Lisa Mayhew said: “Our two firms share a strong commitment to innovation in the interests of our clients. We also have an unusually strong cultural fit with a mutual focus on collaboration across our businesses in the interests of deep and lasting client relationships. It is encouraging for the potential firm that BLP and Bryan Cave both have this complementary heritage, but crucially also share the same ambitions for the future.”

Bryan Cave chair Therese Pritchard said: “If we combine we will operate without regard to geographic boundaries. Our firm would be one of only a handful of global firms operating in a one-firm structure with more than 500 lawyers in both the US and also internationally. We will seamlessly provide counsel to clients across the globe, deliver client service at a new level and use technology and innovation to redefine efficiency in the practice of law.”

A merger would create a firm of around 582 partners and $989.5m (£744m) in annual turnover, and would gift BLP with an additional 13 partners in London. The firm would have 32 offices in 12 countries and a platform of 1,200 lawyers.

In the latest UK 200 report, Berwin Leighton Paisner’s figures showed a 7 per cent rise from £254m to £272m in 2016/17, but the firm also saw its average profit per equity partner (PEP) fall by almost 8 per cent to £630,000. BLP did not provide net profit but The Lawyer estimated this at £50.4m, based on 80 full equity partners on an average of £630,000.

Meanwhile, Bryan Cave’s LLPs for the 2016 period show a 32 per cent increase in revenue from €4.8m to €6.4m, generated by an average of nine equity partners, up from seven in 2015.

BLP’s global RPL stood at $561,000 compared to Bryan Cave’s $699,000, The Lawyer’s Global 200 report shows. Revenue per partner stood at $1.6m (£1.2m) and $1.9m (£1.4m) respectively.

The firm’s merged revenue would put it below King & Spalding ($1.06bn) and above Squire Patton Boggs ($983.1m) at number 35 in the Global 200.

Both firm’s practice mix is interesting: real estate is BLP’s largest practice area with 68 partners, followed by corporate (37) and litigation (27). These are also the three most important practice areas at Bryan Cave, although the order is different: litigation with 122 partners, followed by corporate with 86 and real estate with 48.