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CompetitiveAnalysis_Law_Firms

Merger Analysis and Negotiation Support

MERGER ANALYSIS PREPARATION

Strategic Purpose for the Merger

Expectations and Goals

Identification of Potential Obstacles

  • Firm Name
  • Locations
  • Known Conflicts of Interest

Non-Disclosure Agreements

Communication Protocols

Establish Secure Electronic File Depot

Form of Merger

Assumption of Liabilities

Purchase of Assets

Wind Down/ Create New Firm

INITIAL DISCOVERY & INFORMATION REVIEW

Initial Information Request

Basic Information - Excel Form(If Possible) - 3 Years Historical & Current YTD for each firm

Employee Detail

Employee List (TKPR Profitability, Compensation Analysis, Overhead Analysis, Staffing Ratios, Historical Payroll) - Salary, Bonus History, Raise History, Position, Hire & Termination Date, Benefits Data, Secretarial/Staff Allocation

Contract Labor

Working Attorney Productivity Reports

Working Timekeeper Productivity (TKPR Profit) - Billable Hours, Billable Value, Amount Billed, Amount Collected & Average Rate

Write-off Reports

Any Expectations - Hours, Billings, Collections

Client Productivity Reports

Top Client Fees Billed/Collected (Concentration of Risk) - Sorted on Working Timekeeper & Originating Attorney - Amount Billed & Amount Collected

Top Client Fees Billed/Collected (Concentration of Risk) - Sorted on Practice Area - Amount Billed & Amount Collected

Working Timekeeper by Client (Workload Distribution) - Billable Hours, Amount Billed & Amount Collected

Originating Attorney by Client (Competitive Comp & Workload Distribution) - Billable Hours, Amount Billed & Amount Collected

Extended Services (Marketing plan, Client Profitability, Partner Compensation Analysis, Associate Performance)

Financial Statements

Income Statements, Balance Sheets, General Ledger Asset and Expense Accounts (Income Statement Ratio Analysis, IS Breakout, Cost Per Hour)

Current AR and Work In Progress (WIP) Aging

Operating Agreement & Partner Compensation Plan

Operating Agreement with Amendments and Description of Partner Compensation Plan

Recruiter Fees

DATASET CREATION

Common Evaluation Templates

Review and Approval of Template Data

PRELIMINARY MERGER MODELS

Create Combined Merger Model

Eliminate Redundant Expenses

Increased Revenue Opportunities

Other Operating Efficiencies

Circulate Combined Merger Model to Both Parties

Revisions and Updates

Publish Revised Preliminary Merger Model

Decision to Proceed or End Discussions

DUE DILLIGENCE

Prove Up Plan Assumptions

Historical Data

Available Proof for Post-Merger Performance Assumptions

HR Considerations

  • Comp and Benefit Plans
  • Identification of Key People
  • Post-Merger Staffing Model

Review of Assumed Debt Obligations

Bank Notes

Office Leases

Equipment Leases

Asset Purchases

AR and WIP

Furniture and Equipment

FINAL MERGER PLAN

Post Due Dilligence Financial Model

Final Assumptions

Best Case Senario

Worst Case Scenario

Benchmarks and KPIs

Merger Summaries for Distribution to all Partners

MERGER AGREEMENT

Documentation of Key Merger Elements

Compensation Plans

Ownership Interests

Partnership Admissions

Exit Strategy

Consultation and Coordination with Firm Legal Counsel

MERGER TIMELINE AND IMPLEMENTATION PLAN

Project Plan and TImeline

Roles and Responsibilities

Finance

Accounting

Marketing

IT

HR

Logistics

POST MERGER FOLLOW UP

Key Assumption Validation

Plan Adjustments and Corrective Actions