Indian law firms take baby steps for consolidation

THE GLOBAL LEGAL industry saw a seismic shift last week, with the partnerships at Herbert Smith Freehills, widely acknowledged as one of the world's most elite law firms, and top US law firm Kramer Nevin Naftalis & Franklin voting to approve a historic merger.

- JYOTSNA BHATNAGAR

The new entity will have 2,700 lawyers and an estimated $2 billion in revenue and 26 offices worldwide. While the merger may not impact the domestic legal industry immediately, top-tier Indian law firms have also started taking baby steps to consolidate in a bid to create specialized giant legal entities.

Neha Sharma, founder and head of Avimukta, a well-known legal recruitment consultancy, says "What we are seeing now is a move back to safe, compliance-driven tier-1 firms which offer sustainability over longer periods of time. Indian law firms are also entering a critical consolidation and hiring phase, with top-tier firms picking up rainmakers from the market along with their teams."

Sharma adds that this trend is not only about expanding headcount but strategically building capability in specialized practice areas. "Most leading firms are investing heavily in top-dollar talent to enhance their bench strength in niche sectors. Inorganic hiring is also proving to be a gateway for firms to enter or bolster verticals where they previously had limited presence. This includes hiring senior lawyers along with their teams and client relationships, allowing firms to absorb fully-formed practices overnight," she explains.

Large firms now offer seasoned lawyers a platform with deep pockets and a longer runway to establish themselves before being expected to perform. "There is a runway given to top lawyers from smaller or mid-tier firms, who are onboarded by large firms with the understanding that the first year is for consolidation. This approach allows firms to strategically fill gaps in their service offerings by acquiring teams that are ready to deliver from day one," she concludes.