Lacklustre Canadian market leads Gowlings to hook up with U.K. firm

Gowling Lafleur Henderson LLP is merging with U.K.-based Wragge Lawrence Graham & Co. to create a new international firm with more than 1,400 lawyers.

Its new name, Gowling WLG, will maintain its Canadian heritage, which many firms have lost in recent mergers with international firms.

The new firm — full name: Gowling WLG International Ltd. —  which officially launches in January 2016, will have offices in 18 cities across Canada, the U.K., Asia, the Middle East, and Europe. Gowlings is currently one of the five largest law firms in Canada with over 750 lawyers.

“It’s a really wonderful day for Gowlings and a wonderful day for Canada to see a Canadian firm expanding globally in the way we are,” says Scott Jolliffe, CEO of Gowlings.

While other firms from the U.S. and U.K. approached Gowlings, Jolliffe says WLG was a good fit as it shares many of the firm’s strengths in expertise, particularly in the areas of intellectual property and innovation.

The firms are also like-minded and share similar corporate environments, says Jolliffe.

“They’re very much like us. They’re good people, they are sort a people-oriented firm as we are,” he adds. “They are one of the best employers in the U.K. as we are in Canada.”

While the appeal of an international market contributed to the merger, Jolliffe says a lacklustre Canadian legal marketplace was a bigger motivator.

“The Canadian market has been pretty stagnant or contracting on the legal side,” Jolliffe tells Legal Feeds. “The same is true for business generally in Canada. Our clients are more and more looking into international markets and especially developing markets for their growth.”

“Gowling WLG is a true coming together of like-minded firms,” said David Fennell, CEO of WLG. “In addition to complementary practice and sector strengths, a strong commitment to client service, and a shared vision for international growth, both WLG and Gowlings have fostered internal cultures that champion a people-first approach, innovation and collaboration. Together, we look forward to building one of the top sector-focused law firms in the world.”

The news follows another major law firm merger in March, when international giant DLA Piper found a portal into the Canadian market through an amalgamation with Vancouver-based Davis LLP.

Unlike DLA Piper Canada LLP and Dentons Canada LLP (which was formed when Fraser Milner Casgrain LLP merged with SNR Denton and Salans in 2012), Gowling WLG will not follow the Swiss verein model.

Gowling WLG will be structured as a company limited by guarantee, a scheme that creates an umbrella organization of which WLG and Gowlings will be members, according to Jolliffe. While it’s not a financially integrated partnership, the two firms’ client service and approach to the market will be full integrated, he says.

“We found that the U.K. limited by guarantee [model] was a more flexible structure and one that is a little more transparent,” he adds. “It’s also governed by U.K. common law, which we’re much more familiar with than Swiss civil code.”

The new firm will be governed by an international board, comprising each of the founding firms’ CEOs, Jolliffe and Fennell, and two additional representatives from each founding firm.

Gowlings WLG will provide services in areas including life sciences, manufacturing, power generation and distribution, projects and infrastructure, real estate, energy, and technology and communications.

Clients are excited about having immediate access to international expertise, Jolliffe says. “Secondly, a lot of our clients have been proud of the fact that this is a Canadian institution expanding internationally under a Canadian name.”

With this merger, Jolliffe says it was important for Gowlings to maintain its Canadian identity.

“We’ve seen other very good firms, U.S. and U.K. firms come to Canada and pick up a Canadian law firm to become part of their existing international platform. What that has meant is it’s a good thing for those [Canadian] firms but they’ve sort of given up their name and identity to join an international firm,” he continues.

“Our feeling was that we should create our own — a platform that was particularly suited to the Canadian market and the needs of Canadian business.”

Among recent mergers was also Norton Rose’s move in 2013 to join up with American firm Fulbright & Jaworski LLP, creating Norton Rose Fulbright — just a few years after storied Quebec-born Ogilvy Renault became part of U.K.-based Norton Rose.

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