Shroffs stay on top of law firm league
Mumbai: The division of the country’s biggest law firm, Amarchand & Mangaldas, among the two brothers, Shardul and Cyril Shroff, has led to a new pecking order in India’s legal services industry. The numero uno position, which was held by the undivided Amarchand & Mangaldas for years, will now be held by Cyril Amarchand Mangaldas, one of the newly carved out outfits, while the second position will be taken by Shardul Amarchand Mangaldas, according to industry trackers.
As a result of the re-alignment, AZB & Partners, which until now was at No.2, has been pushed one notch lower followed by Khaitan & Co and JSA. The top five firms, known in industry parlance as the ‘magic circle’, have been involved in most of the prominent and big mergers and acquisitions (M&A) transactions in the country.
Luthra & Luthra, which was at the fifth position, will now fall out of the top five band.
“There will be one more competitor in the market,” said Rabindra Jhunjhunwala, partner at Khaitan & Co.
According to the arrangement, Amarchand & Mangaldas, which was founded by Shardul and Cyril’s grandfather, Amarchand Shroff, in 1917, has been split equally between the siblings, with Shardul getting the Delhi region which includes Kolkata, Ahmedabad and Gur- gaon offices, and Cyril bagging the Mumbai region which includes Bangalore, Chennai and Hyderabad offices. Both also have the right to operate in each other’s territory. With the Shroffs beginning their respective innings, both have begun building their franchises, networks and teams.
An e-mail sent to Shardul and AZB’s Zia Mody didn’t elicit any response while Cyril couldn’t be reached for immediate comments.
“Clients will be the biggest beneficiaries of this split as both (Shardul and Cyril) will vie for the same set of customers. They will have a war chest and will be willing to work at a competitive fee, putting pressure on pricing in the industry,” said Sujjain Talwar, founding partner of Economic Laws Practice, which has now been pushed to the ninth slot in the rankings. In fiscal 2015, the combined revenue of Indian law firms doing commercial and corporate work was nearly $1 billion.
Industry bases law firm rankings on the revenue generated by them, number of lawyers and partners in the firm and their client coverage. According to researcher RSG Consulting, Amarchand & Mangaldas has been at the top on its list of India’s top 40 legal firms since 2008, when the UK-based company began operations.
“If we ranked the new Amarchand law firms, we would expect one of them to stay at the top…However, the rankings may change after a year of them operating separately, and we’d expect to see the firms differentiate themselves and their market positions,” said Yasmin Lambert, partner and senior consultant, RSG Consulting.
Meanwhile, the two factions of the erstwhile Amarchand & Mangaldas have moved quickly to fill in the gaps created due to the split, leading to a flurry of activity by them in the market. Both are in the midst of giving new identities to their businesses even as they look to ramp up office space, clients and staff.