Merger Analysis and Negotiation Support

Small and mid sized firms must diligently work from beginning to end to ensure that a merger is successful. In addition to financial risk, for many of these firms, it means giving up or sharing their identity and autonomy. Ensuring the merger benefits outweigh the risks requires setting clear expectations related to cash flows, compensation, merger costs, and short and law term profits.

We help law firms create and verify assumptions, create accurate models that objectively consider the material economic elements, assess the risks, and ensure expectations are clearly defined and communicated. We help our clients eliminate the surprises.

Clients use our services on a project basis or on a longer-term agreement to support post merger implementation and analysis. Our role in a merger can include financial analysis, strategic advise and support, and as a resource to support a successful negotiation process.

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Benefits

What can you do to improve the chances of a successful merger and what can PerformLaw do for you?

The Process

How does a merger services agreement work?

Resources

Where can I learn more about the topics I might want advice about?

Benefits

The confidence of knowing you will receive objective feedback. Clients who engage PerformLaw for merger services get objective, experienced, and practical advice about how to best put two entities together.

The ability to more clearly understand your issues and opportunities and act on our recommendations. All our tools, templates, processes, market awareness and creative plan design expertise are included in the engagement.

A solution for the long term. All our engagements are designed to raise the level of in-house competence and promote self-sufficiency.

The ability to remove merger bias from the analysis and negotiations. Merger analysis is best performed by someone who does not have a vested interest in the outcome. We filter out any merger bias and ensure our clients appropriately consider all the essential factors.

What PerformLaw can do for you:

  • We help clarify and communicate goals and expectations.
  • We provide easy to understand analysis and processes.
  • We help remove bias from the process.
  • We ensure that merger services facilitate a faster decision-making process.
  • We are available when clients need us; before, during and after an engagement.

THE PROCESS

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

Resources

NOT SURE WHERE TO BEGIN?

Here are some of our most helpful resources to learn more about ..........

Knowledge Base

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Resources