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Overview
The past year has helped to measure the initial success of the numerous mergers witnessed in 2007, when Portugal’s legal market appeared to adopt a ‘bigger is better’ approach. While some firms have emerged stronger than before, others have had to come to terms with perhaps less fruitful attempts at expansion, resulting in a series of spin-offs and demergers.
One surprise departure was that of Pedro Cardigos, who left newly formed ABBC – Azevedo Neves, Benjamim Mendes, Bessa Monteiro, Carvalho & Associados – Sociedade de Advogados RL to launch Cardigos e Associados. Though the split is amicable, it nonetheless serves to highlight the unforeseen partner integration difficulties some firms have experienced.
Spanish firms Uría Menéndez, GARRIGUES and Cuatrecasas, Gonçalves Pereira continue to solidify their Portuguese presence, each representing a host of high-calibre Portuguese clients. The global re-branding of Cuatrecasas, Gonçalves Pereira is indicative of the firm’s commitment to full integration between its Portuguese and Spanish offices. It would appear that many Spanish firms are keeping one eye firmly set on the Portuguese market, with Gomez-Acebo & Pombo Abogados rumoured to be its newest entrant.
Though there has been a notable decrease in M&A activity over the past year, the public law sector has remained relatively unscathed. With the Portuguese government investing heavily in projects – including highway concessions, rail links and the new Lisbon airport – firms in possession of strong project finance and public law practices will be cushioned by a steady stream of work, despite the otherwise difficult market conditions. Likewise, those firms present in the energy sector will benefit from the ever-increasing number of renewable energy projects up for tender within Iberia.
It remains to be seen how Portugal’s fastest growing firms will compete in a market wherein lucrative corporate transactions are ever harder to come by. There is some speculation that the rapid growth of firms seen in previous years may now backfire, as firms begin to question whether or not their growth has in fact exceeded market demand. While many Portuguese lawyers express a cautious optimism about the year ahead, 2009 will nonetheless serve to distinguish those firms able to succeed in a highly volatile global economy, from those whose growth strategies will need to be reassessed.