FOLLOW US

A groundbreaking vote of confidence emerged on Friday, as partners overwhelmingly sanctioned the fusion of Allen & Overy LLP and Shearman & Sterling LLP. With more than 99% of partner votes in favor at each institution, the stage was set for the formation of a colossal legal juggernaut. Allen & Overy dropped this bombshell, sparking excitement and speculation across the legal realm.

A&O Shearman Sterling Rises

This marriage of giants between London's Allen & Overy and New York's Shearman & Sterling has produced a behemoth in the legal world, boasting nearly 4,000 lawyers and a combined revenue stream that gushes at $3.5 billion. Their lovechild shall henceforth be known as 'Allen Overy Shearman Sterling' or simply 'A&O Shearman.' As the dust settles, anticipations are high, as the deal is set to be sealed and delivered by May 2024.

Words of Transformation: Wim Dejonghe Speaks

"This is a pivotal moment for both of our entities and the legal profession as a whole," declared a jubilant Wim Dejonghe, Allen & Overy's senior partner. "Our partners have not just given a nod but a resounding roar of approval for this merger. It signifies a transformational leap for the legal world. We've long admired Shearman & Sterling for their exceptional reputation, talent pool, and clientele. We are steadfast in our belief that this union will herald a truly extraordinary global firm, tailored to navigate the intricacies of an ever-evolving world."

Crossing the Atlantic: A&O's U.S. Ambitions

This merger flings open the doors to the U.S. market for Allen & Overy, an aspiration cherished by the U.K.'s Magic Circle firms for over two decades. Even before this colossal merger was whispered, Allen & Overy had cast a more extensive shadow in the U.S. compared to its peers. With six offices dotting the American landscape—Boston, Los Angeles, New York, San Francisco, Silicon Valley, and Washington, D.C.—the firm commanded over 270 legal maestros.

Following the union, their U.S. branch is set to sparkle with an approximate $1 billion in revenues and around 650 lawyers, including approximately 200 partners.

Allen & Overy and Shearman & Sterling :  A Tale of Unrequited Mergers

Both Allen & Overy and Shearman have flirted with merger prospects in the past, but the stars never aligned. Shearman, for instance, was caught in the throes of discussion with Hogan Lovells late in December 2022. Alas, that dance was cut short in March.

On the flip side, Allen & Overy had engaged in a lengthy courtship with O'Melveny & Myers LLP, a merger that eventually withered away in September 2019.

Shearman's Turbulent Ride

When the music ended with Hogan Lovells, Shearman faced a turbulent period. Staff and attorney layoffs left their mark earlier this year. The baton passed to a new leader, senior partner Adam Hakki, following the shattered dreams of the merger. The firm also waved goodbye to its entire German office, which sailed away to Morgan Lewis & Bockius LLP.

Despite the new merger with Allen & Overy, the exodus continued. At least eight attorneys bid adieu in the U.K., South Korea, and Singapore, making Ashurst LLP their new harbor. June saw four attorneys depart for trial boutique Reichman Jorgensen Lehman & Feldberg LLP. July witnessed two partners heading to Gibson Dunn & Crutcher LLP, one to O'Melveny & Myers LLP, and one to Cleary Gottlieb Steen & Hamilton LLP.

Shearman's numbers dwindled from over 850 lawyers at the close of 2022 to around 600 lawyers by the end of May, and that count further reduced to 564 in recent times.

Allen & Overy and Shearman & Sterling : A Visionary Outlook

In his Friday statement, Adam Hakki, senior partner at Shearman & Sterling, extolled the possibilities bestowed by this merger as "unparalleled." He declared, "Our partners have recognized and welcomed this unparalleled opportunity to combine our individual market leadership and brands to serve clients as an integrated global law firm, preeminent in all our markets. A&O Shearman will be a firm unlike any other in the world, built to achieve exceptional outcomes for our clients through an intentional focus on quality, excellence, and collaboration. We are creating a new industry leader, with truly global capabilities, and we are excited for what is to come."

Allen & Overy and Shearman & Sterling : The Advisors

Lazard Ltd. took on the role of financial adviser, while Simpson Thacher & Bartlett LLP steered the legal course for Allen & Overy in this landmark transaction. Davis Polk & Wardwell LLP served as legal counsel to Shearman.