K&L Gates Chief Says Norton Rose Deal More of an Arrangement than a Merger
K&L Gates chairman Peter Kalis says the recent spate of trans-Atlantic mergers aren’t the real thing.
Kalis told The Lawyer that the deals are more akin to “arrangements” than mergers, and that includes Norton Rose’s claimed merger this week with law firms in Canada and South Africa. He even has a name for the deals: “Noah’s Ark mergers.”
Kalis said several recently announced deals aren’t mergers in the true sense because they don’t involve full sharing of profits since day one. They include these combinations: Norton Rose with Ogilvy Renault in Canada and Deneys Reitz in South Africa; Hogan & Hartson with Lovells; Sonnenschein Nath & Rosenthal with Denton Wilde Sapte; and Squire Sanders & Dempsey with Hammonds.
“There has been a recent spate of ‘Noah’s Ark’ mergers: two CEOs, two partnerships, two profit pools, two accounting systems, two operations centers, all with a single flag flying above the Ark,” Kalis told The Lawyer. “A merger is when two become one, not when two become two.”
He added he wonders what clients think of these deals since they themselves are reluctant to “embrace Noah’s methodology.”
K&L Gates is itself the product of several mergers, and it had more than $1 billion in revenue last year.
Norton Rose chief executive Peter Martyr says Kalis is wrong. “In this deal we’re really nailed together, we behave as one,” he told The Lawyer.
