Law firms call off mega merger

The huge merger between law firms Meitar and Arnon, Tadmor-Levy is not going ahead. It was reported last month that the two firms were negotiating a merger that would have created the largest law firm in Israel by a long way. They recently decided, however, not to proceed with the move.

According to Dun & Bradstreet’s ranking, Meitar is already the largest firm in Israel, with some 540 lawyers, while Arnon, Tadmor-Levy is in the top five, with over 350 lawyers.

Sources in the legal world said that the decision to abandon the merger was made jointly by both sides, but that the partners at Arnon, Tadmor-Levy were especially against it. Negotiations were ended before a vote was taken at either firm.

“Globes” has learned that the lawyers at both firms have been informed of the cessation of the merger negotiations. The notice states: “The process of mutual familiarization between the firms was very positive and took place in a good spirit, and there is great mutual respect between the partners who met. Beyond the many challenges that a combination of two such large firms faces, however, matters of substance arose, including conflicts of interests that created many difficulties, and at this stage the two firms have decided not to continue to proceed with the talks between them, for the time being.”

The fear of conflicts of interests is indeed one of the main reasons for breaking off the talks. These two firms currently advise the largest companies in the Israeli economy. A merger was therefore liable to lead to a situation in which the combined firm would have to turn away potential clients, because of the high probability that it already represents clients on the other side of the deal or the lawsuit.

Another consideration was apparently the fear of a wave of resignations by lawyers who might not have found their place in the planned mega-firm. A merger on this scale is likely to create duplication in the merged firm’s areas of practice and departments, and block possibilities for lawyers to stand out and advance in status and pay.

Sources in the profession also point to fears on the part of some of the partners that their profitability would be damaged in the long term. This arose from the fact that the merger would lead to a small number of the most senior equity partners taking a larger profit at the expense of the other partners.

Alongside the financial considerations, there was also concern at the firms about an organizational mismatch and cultural gaps that might weigh on implementation of the merger. A merger of this kind is challenging since it brings together hundreds of lawyers who were used to different work environments and even saw each other as competitors.

Merger talks underway to create mega Israeli law firm

With the revelation of the merger negotiations, the possibility also arose that a deal leading to a firm numbering 900 lawyers would require approval by the Competition Authority, and would be examined by the Israel Tax Authority. Although, as mentioned, the talks were broken off before a vote, it may be that the regulatory complexities were also a factor behind the decision not to proceed with the deal.

Published by Globes, Israel business news – en.globes.co.il – on October 28, 2025.

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