Largest Merger in Law Firm History Announced

Article excerpt

The largest merger in law firm history was announced this week when the biggest Texas firm joined forces with a 100-lawyer New York partnership, a continuation of the consolidations that have reshaped the legal industry.

The merger, between Fulbright & Jaworski and Reavis & McGrath, will create the seventh-largest firm in the United States, with 575 lawyers in seven cities around the nation and two abroad.

In large part, the wave of mergers in New York and elsewhere has been brought by pressure on middle-sized firms - those with 100 to 200 lawyers - that must compete with larger partnerships that can offer more services at a lower price.

But lawyers involved in Thursday's announcement said it was the larger firm, Fulbright & Jaworski, that had been feeling a stronger need to merge.

``We have for a number of years been losing clients because we have been unable to serve their needs in New York and Los Angeles,'' said Gibson Gayle Jr., managing partner of Fulbright & Jaworski, which has grown to 475 lawyers.

``We feel Reavis, with its offices in those two cities, will complement our practice precisely.''

Fulbright and Jaworski is already the 11th-largest firm by number of lawyers and the 16th-largest by income.

Although it has become a national firm known for its litigation, corporate and bankruptcy practices, it has not had a significant presence for a firm its size in the financial services area, lacking strong connections to the capital markets on the East and West coasts.

Fulbright & Jaworski was founded in 1919 by two Houston lawyers, R. Clarence Fulbright and John H. Crooker. The firm's name was changed to reflect the leadership of Leon Jaworski, the Watergate special prosecutor, who died in 1982.

Clients of Fulbright & Jaworski, which has grown dramatically in the 1980s, include the Exxon Corp., the Coastal Corp., Baylor University and the BankAmerica Corp.

The firm also helped represent Texaco Inc. in its protracted litigation with the Pennzoil Co.

Fulbright & Jaworski had income last year of about $54 million on revenues of $117 million, people at the firm said.

The new entity, which will be created on Jan. 1, will be called Fulbright & Jaworski at its Houston headquarters and in six other cities. Its New York and Los Angeles offices will be known initially as Fulbright Jaworski & Reavis McGrath.

Partners at Reavis & McGrath said Thursday that they had agreed to merge to diversify their business and locations.

They vigorously denied reports in trade publications that a lull in business and a recent series of defections had led to a desire to merge. …