Global Legal Post article quotes Edwards Gibson Director in: “New York via Sydney: Herbert Smith Freehills’ unique transatlantic merger play”.
Edwards Gibson Director, Scott Gibson, was quoted in a Global Legal Post article by Victoria Basham titled, "New York via Sydney: Herbert Smith Freehills’ unique transatlantic merger play." The article explores Herbert Smith Freehills’ (HSF) surprising decision to merge with New York-based Kramer Levin Naftalis & Frankel, a move that will bolster HSF’s presence in the competitive US market while significantly expanding Kramer Levin’s global footprint.
The article explores how the merger is poised to create a $2 billion revenue firm, with the combined entity—HSF Kramer in the US and Herbert Smith Freehills Kramer elsewhere—gaining momentum to enhance its market position. However, the deal has raised concerns over differences in profitability, with HSF’s revenue and headcount far exceeding those of Kramer Levin. The deal remains subject to partnership approval, with a vote scheduled for February 2025.
Scott Gibson provided valuable insight into the potential concerns surrounding the deal, particularly regarding compensation. He noted that Kramer Levin partners might be wary of their pay being diluted due to the merger, given the disparity in profitability between the two firms. Gibson suggested that HSF could address these concerns by extending its lockstep system and introducing merit-based pay to ensure a fair distribution of compensation across the combined firm. He also highlighted the cultural and strategic challenges the merger could present, especially in terms of regional focus and integration.
Despite these challenges, the merger is expected to strengthen HSF’s core disputes practice and position the firm for growth in key sectors, including energy, financial services, and technology. HSF’s leadership remains confident that the merger will provide significant opportunities to expand the firm’s US footprint and further enhance its position in the global legal market.
Read the full article on Global Legal Post here.