The merger between Allen & Overy (A&O) and Shearman & Sterling (Shearman) is now live.
UK-headquartered ‘Magic Circle’ law firm A&O successfully completed its merger with US-headquartered Shearman to become A&O Shearman on May 1.
A&O Shearman is the third largest integrated law firm in the world, with revenues in the region of US$3.5 billion and nearly 4,000 lawyers across nearly 50 offices.
In a statement, the firm said there will be global practice groups, such as mergers & acquisitions, litigation, and debt finance, alongside six key industry sectors operating across practices, products, and geographies. These are energy & infrastructure; established industries; financial institutions; life sciences; private capital/private equity; and technology.
The global megafirm’s regional offices will focus on “local go-to-market strategies and collaboration”, according to the statement, as well as “local market reputation-building; talent attraction and development; and local operations.”
Commenting on the merger, Khalid Garousha, who has assumed the role of senior partner, said: “A&O Shearman is a new industry leader with unmatched experience, a unique culture and truly global capabilities. I look forward to working alongside my colleagues to unlock the potential of our new firm.”
“We will provide clients with the world-class integrated solutions and unparalleled regional experience and knowledge that they are looking for in today’s increasingly complex commercial and regulatory environment,” he said.
So how did we get here and how will the merger shake-up the Middle East legal market?
News of the merger between A&O and Shearman was first reported in May last year.
In October, it received the green light to go ahead when 99% of partners at both firms approved the plans.
In March, the combined firm announced its first leadership appointments, with Abu Dhabi-based Garousha appointed as senior partner. He was up against two London-based partners for the top job.
A month later the firm announced the appointment of David Foster as regional managing partner for the Middle East, Turkey and Africa (META) region, serving an initial term of two years.
Garousha had led A&O’s Middle East and Turkey operation since 2020, prior to becoming interim global managing partner in July 2023. The role has since expanded to encompass Africa, namely Morocco and South Africa.
Foster, who is based in Dubai, will oversee the firm’s operations across the META region, where it has six offices in the UAE, Saudi Arabia, Turkey, Morocco, and South Africa, and over 200 lawyers.
Now as the combined firm sets its sights on global domination, what does this mean for the Middle East legal market?
Speaking to Law Middle East, a London-based partner at an international law firm with a Middle East practice, said: “Both are great names in the region—A&O has a great team and depth.”
Continuing, the law firm partner said:
“Generally, the merger is not seen as a merger of equals—this is an A&O takeover of Shearman, and I think that probably flows through into the Middle Eastern offices … [they] will need to think about ‘rightsizing’ in their offices over there.”
In October 2022, it was reported that leading corporate partner Marwan Elaraby had departed Shearman for Gibson, Dunn & Crutcher in Dubai. A key client at Shearman was the Abu Dhabi National Oil Company (ADNOC), which Elaraby advised on a range of matters including strategic investments, joint ventures, and the launch of its crude oil trading unit. He also worked on the 2017 IPO of its distribution unit, one of the largest public offerings in the UAE to date.
Some months later, in January 2023, Gibson Dunn opened an office in Abu Dhabi, its second in the Middle East, with a team of seven lawyers, including three partners, from Shearman.
“[They] took the ADNOC relationship with them and the vast majority of that work”, the partner said, adding: “I think Shearman was left quite light there.”
Meanwhile, Garousha has been in the UAE for the entire duration of his 24 years at A&O, and with him at the helm of the newly-merged firm, what does this mean for its Middle East practice?
”I think A&O see the Middle East as a key area of growth so it makes sense to have Khalid hold a senior position,” the partner said. “They’ve obviously made a couple of hires there as well and looking to Saudi (as most firms are).”
In March, A&O announced it had opened an independent office in the Kingdom of Saudi Arabia, after receiving a licence from the Ministry of Justice. It is the firm’s third Middle East office after Abu Dhabi and Dhabi.
Shearman had an established practice in Riyadh, led by partner Sultan Almasoud, who has headed the firm’s presence in the Kingdom for nearly a decade, and includes partner Mohsin Suleman. The duo now join A&O’s team on the ground, which includes partners Hosam Ibn Ghaith and Haris Meyer Hanif, following the completion of the merger.
A&O previously operated through an association with local firm Khoshaim & Associates in Saudi Arabia.
