Lawyers have left law firm Magic Circle and a US rival in droves ahead of a £2.8bn merger

Magic Circle by Allen & Overy will move to new offices on London's Broadgate campus by 2027

Dozens of senior lawyers have left Magic Circle law firm Allen & Overy and American competitor Shearman & Ahead of the £3.5bn (£2.76bn) merger

At least 20 senior lawyers have left Allen & Overy has offices around the world since the company announced plans to merge with New York law firm Shearman & Sterling in May.

Departure from Allen & Overy, which was founded in 1930 and advised King Edward VIII during his abdication, had five partners, nine advisers and five senior lawyers.

According to data collected, seven people have left the law firm's head office in London. from Legal Recruiter McRae.

Meanwhile, Shearman & At least 20 senior lawyers have also left Sterling since June, including nine partners and seven associates.

Many departures from both Shearman and Allen & This year we have worked in overseas offices, including in Europe, Asia and the Middle East.

Melinda Wallman, a partner at Macrae, said: «When law firm mergers occur, it is common to see partners leaving, even entire offices leaving, as both merging firms are in a small legal market.»

The merger is expected to will lead to consolidation as Shearman & Sterling UK employees set to move to Allen & Headquartered in Overy City.

Ms Wallman said: “Law firm mergers often result in the departure of several partners — a mass exodus usually indicates a lack of confidence in the combination.”

The transatlantic unification should be completed by May 2024 after 99% of transactions have been completed. partners at both firms voted in favor of the deal in October.

News of the departures followed reports that Allen & Overy & Shearman & Sterling offered the partners forgivable loans that would not have to be repaid if they remained with the combined firm for a certain period. As reported by Financial News, the loans are intended to secure partners.

Shearman, founded in 1873, is expected to gain scale from the merger after facing a series of problems with partners leaving for wealthy competitors. .

The combined firm, which will be called A&O Shearman, will have approximately 4,000 lawyers in 48 offices worldwide. The company will have combined revenues of approximately $3.5 billion.

The two firms are believed to have agreed to a “modified” compensation model in which partner pay is based in part on seniority and performance.

< p>Allen & Overy will move further away from the traditional seniority-based pay model of British law firms, which differs from the «eat what you kill» pay structure typically favored by American competitors.

Previously in this month, Allen & Overy has announced the shortlist of candidates vying to become senior partner and managing partner of the new firm until April 2028.

None of Shearman & Sterling lawyers will fill any top position, reflecting the dominance of Allen & Overy in the merger.

An Allen & A spokesman for Overy said at the time: “Shearman & Sterling partners will hold critical global and regional leadership positions within the combined firm, including on the executive committee, board of directors, practice group and regional leadership. These positions will be advertised in due course.”

Allen & Overy & Shearman & Sterling has been approached for comment.