McGrigors confirms talks on possible cross-Border merger

The talks, which come amid fevered talk of consolidation across the legal sector, would make the combined firm the 12th largest in the UK with a turnover of some £280 million and more than 350 partners.

Both firms, which together employ more than 1,500 lawyers, will vote next month on whether to proceed with the deal.

“This certainly wouldn’t be the first or the last,” predicted Charles Barnett, professional services partner at accountants PKF.

It is understood a number of other Scottish law firms are currently in discussions or are looking for potential merger partners.

Early this month The Scotsman predicted a major merger involving a Scottish firm within the next three years as profits continue to be squeezed by a glut of lawyers scrambling for work north of the Border.

The continuing loss of Scottish-headquartered plcs has exacerbated the dearth of corporate work which has affected the whole sector in the UK.

McGrigors, which is around a third of the size of Pinsent Masons by turnover, said in a statement: “We can confirm that Pinsent Masons and McGrigors have been in discussions about ways in which both firms can work together to look at how we can bring a wide range of legal services to our respective clients, as well as improve their delivery.

“Both firms complement each other well, being leaders in the field of construction, energy and infrastructure.

“A potential tie-up would greatly benefit the clients of both firms, providing a wealth of market-leading expertise across a number of sectors and practice areas.

“It would also provide a strong platform upon which to grow internationally, with a continued focus in Europe, the Gulf and Asia Pacific. We will be spending the coming days speaking to our partners and staff about the proposals and will not be making any further comment at this time.”

While law firms have been under increasing commercial pressure in recent years – with the lack of transactional work such as M&A and property work a major factor – Mike McCusker, a partner at PwC. stressed there could be very good commercial reasons for a deal which could create a “strong, larger and more focused firm”.

He also said he wouldn’t be surprised if the merger was the first of many to be done. “Compared to say the accountancy sector there are far more law firms out there,” he pointed out.

McGrigors, headed by managing partner Richard Masters, has offices across Scotland and also in London, Manchester, Belfast and Doha.

In addition to its London headquarters and offices around the UK and overseas, Pinsents has Scottish bases in Edinburgh and Glasgow.

Barnett pointed out there could be potential efficiencies from combining offices and support staff from any merger.