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a communication from

October 2010

The 2010 Global 100

U.S. Firms Dominate the Global Market for Legal Services; Currency Fluctuations Create an Attractive Cross-Pond Merger Environment

When The American Lawyer published the 2009 Global 100 list on October 1, 2010, at first blush American firms appeared to have fared much better than non-U.S. firms. However, after adjustment for fluctuations in exchange rates,

These figures indicate that the United States remains, by far, the largest legal market in the world with a combination of robust corporate practices and the lion’s share of the world’s litigation. In this ZG Alert, we share our thoughts on the

performance among the Global 100 firms was roughly even. As we note below, the exchange rate fluctuations of the past year have created a friendly economic environment for U.S. firms interested in cross-pond mergers. For British firms with international footprints outside of the United States, the downturn in the global economy has underscored the desirability of a U.S. litigation practice. We posit that this inexorably will drive more trans-Atlantic deal-making.

In 2009 U.S. firms increased their domination of the Global 100, capturing 2.3 percentage points more of the Global 100 gross revenues (GR)1 of $76 billion dollars, and gaining four additional slots on the list. U.S. firms now comprise 79 of the world’s top-grossing 100 firms. The other 21 are comprised of 12 U.K. firms, five Australian firms, three European firms, and one Canadian firm. Moreover, only five

non-U.S. firms are among the 19 mega-firms with revenues of over $1 billion; one was Lovells, which combined with Hogan & Hartson earlier this year. Here’s how 2009 market share, as measured by percentage of GR, breaks out:


79 U.S. firms captured 76.4 percent, up from 74.1 percent


in 2008; 12 U.K. firms captured 18.7 percent;

implications and opportunities we believe are worth noting in light of our analysis.

How the Global 100 Performed, by Region and on a Currency-Adjusted Basis: PPEP, Gross Revenue, and Market Share

The American Lawyer’s analysis of the Global 100 highlighted the fall of the largest U.K. firms in the GR rankings. We recognize, as did The American Lawye , that the 15.6 percent

year-to-year decline in the average value of the British Pound Sterling (GBP) versus the U.S. Dollar had a material effect on how the 2009 GR rankings compared to 2008. Without accounting for the decline of the GBP, the 12 U.K. firms in the Global 100 appeared to experience a revenue decline of 20.5 percent, and a profit per equity partner (PPEP) decline of 14.1 percent in 2009 over 2008, while the American fi r m s e x p e r i e n c e d a r e v e n u e d e c l i n e o f o n l y 3 . 7 p e r c e n t , a n d

enjoyed a slight increase in PPEP of 0.4 percent. However, if the decline in the value of the GBP is accounted for, the U.K. firms were up 1.3 percent in profit, which is slightly better than the U.S. firms. The U.K. firms were down 6.0 percent in revenues, a few points worse than the U.S. results. (See

Tables 2 and 3 on Pages 3 and 4.)



five Australian firms captured 2.7 percent, the same share

as in 2008; and

three Eurozone firms captured 1.8 percent, down from 2.6 percent in 2008.

In addition to dominating the Global 100, U.S. firms similarly dominate the Global 25, occupying 21 of the 25 slots when ranked by GR. The other four are U.K. firms: Clifford Chance, Freshfields, Linklaters, and Allen & Overy. Together, these four

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