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Scale Can Be a Strategy in Troutman and Pepper Hamilton's Potential Tie-Up

Meredith Hobbs LAW.COM

Troutman Sanders, now in tie-up talks with Philadelphia’s Pepper Hamilton, is no stranger to large mergers. Troutman undertook three sizable combinations from 2001 to 2009 that expanded the firm far beyond its Atlanta roots.

Those combinations, with help from lateral recruitment, increased Troutman’s revenue almost fourfold during that period, and it boosted its Am Law ranking from No. 145 in 2000 to No. 72 by 2009.

Now the firm could be looking to replicate its past merger gains. If Troutman Sanders were to combine with 450-attorney Pepper Hamilton, it could transform the firm’s scale once again, in an era where its large-firm competitors are increasingly turning to mergers to build critical heft in practice areas and geography.

While the potential merger is a head-scratcher for some in the Atlanta legal market—with many recruiters and partners at peer firms saying they weren’t familiar with Pepper Hamilton—legal industry observers say multiple large Am Law 200 firms are now considering mergers to try to distinguish themselves in an increasingly crowded national legal market.

Large law firms are feeling a lot of pressure to grow to build strength in key practices and locations, said Robert Brigham, a Bay Area partner at national legal recruiter Major, Lindsey & Africa, not speaking specifically about the Troutman-Pepper talks.

“Firms that are not significant in practices that matter for clients are not winning the client wars,” he said, adding a merger is one way that firms can “dramatically transform themselves in a relatively short time frame.”

“There are firms that on the surface seem not to need something,” Brigham said. “They may be in the second half of the Am Law 100, but they don’t have enough geographic reach or practice area depth.”

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