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Listed legal firms predict revenue boost
By John Hyde » Two pioneering, stock-market listed legal services
businesses have each made bold promises of rapid expansion. Claims outsourcer Quindell told shareholders at its AGM that it expects to increase turnover this year from £650m to £900m. The company said this growth
will come off the back of £250m-worth of contracts with key legal services pro- viders. The company confirmed
Quindell said in a statement: ‘The
key management changes, with Robert Fielding being named chief execu- tive. Founder Rob Terry remains chairman of the board. Former investment bank managers Stephen Joseph and Michael Bancroft have been recruited as heads of investor relations and corporate development. The company made no reference to
‘NOW WE ARE PART OF AN AIM-LISTED COMPANY IT GIVES US AN ADDITIONAL WEAPON AS OPPOSED TO IT JUST BEING A PURE MERGER’
board is confident, in line with expec- tations, that the group will return to a broadly neutral operating cash posi- tion on a quarterly basis in the third quarter of 2014 and deliver strong pos- itive operating cashflow in the final quarter of 2014 and beyond.’ By last Thursday the share price had recov- ered marginally to 18.5p. Meanwhile, another
listed company has said it will seek further expansion after confirming the £15m acquisition of national firm Simpson Millar. Fairpoint Group, a financial services business specialising in ‘financially stressed consumers’, final- ised a deal for the firm that
was first announced in April. Peter Watson, managing partner
two separate developments in recent weeks which coincided with a fall in its share price of over 50% from a high of around 45p. In April, Ameri- can investor Gotham City Research published a report on the company, while earlier this month Quindell was denied a stock market premium list- ing as it had changed too rapidly in the past three years.
at Simpson Millar, explained the deal would provide the firm with extra capital to make further acquisitions in the ‘consumer legal services space’. ‘Now we are part of an AIM-listed company it gives us an additional weapon as opposed to it just being a pure merger,’ he said. He added that the deal will act as a platform for Fair- point in the legal services market, which is ‘ripe for consolidation’.
» Chancellor George Osborne listens to Chinese premier Li
Keqiang addressing delegates of the UK-China Financial Forum at Lancaster House last week. Several City law firms attended events held as part of Li’s three- day visit. Announcements made during the trip include plans to open a London office of the China Development Bank Corporation.
The bank will facilitate Chinese investment in nuclear, telecom- munications and high-speed rail projects. Chris Cummings, chief executive of TheCityUK, said this means there will be an even greater demand for ‘top-quality, professional legal advice, which is exciting news for the legal profes- sion, not just in London but across the UK’.
Eastern promise
23 June 2014
IN BRIEF
CAUTIONS GO OFF THE RECORD
Mid-sized practices lead way
By Catherine Baksi » Mid-sized firms are outperforming their larger
counterparts as small practices strug- gle to compete, according to the latest benchmarking report from account- ants MHA. The survey of 131 firms shows lim-
ited growth in fee income across most sizes of firm except larger practices. Net profits fell overall, with even those firms recording improvements in fees billed showing little growth in profit- ability. Most firms with fewer than 10 part-
ners reported no fee income growth in the past three years and profitability has plummeted. Mid- sized (11-25 partner) and large
firms reported revenue growth of 6% and 3% during the past 12 months, as
a result of greater M&A activity and larger property transactions. Improving revenue at mid-sized
firms has been accompanied by ris- ing profit per equity partner (PEP), up by 21%, while PEP for large firms dropped by 2%. In terms of profitability, 11-25 part-
ner firms did better than 25+ firms and there are some signs that 2-4 partner firms are starting to reap the benefits of managing expenditure, although their profitability is down. Control of lockup remains high
on the agenda. Sole practitioners, 2-4 partner firms and 11-25 partner firms reduced their lockup days. In contrast, for the 5-10 partner and 25+ partner practices, lockup increased by 5% and 8% respectively.
Cautions and minor convictions should not have to be dis- closed in criminal record checks, the Supreme Court ruled last week in T v Sec- retary of State for the Home Department. Judges said the requirement to do so breached privacy.
NEW SERVICE FOR WALES ADOPTIONS
The National Adop- tion Service for Wales will be launched in November in a bid to speed up the process. The service is a key part of the Welsh government’s
social services bill, which received Royal Assent last month.
DOUGHTY GOES DUTCH
Leading civil liberties set Doughty Street will open an interna- tional office in The Hague, Netherlands, in September.
HEALTH CARE STAFF DUTY TO CONSULT
Medical staff have a duty to consult and involve patients in decisions to place ‘do not resuscitate’ orders on their notes, the Court of Appeal ruled last week. In Tracey v Cambridgeshire NHS Foundation Trust, the
court ruled that doc- tors who had failed to do so had acted unlawfully.
ROCHDALE ELECTS PRESIDENT
Pamela Walsh, family partner at Rochdale firm Hartley Thomas & Wright, was elected president of Rochdale Law Asso- ciation at its AGM.
FORCED MARRIAGE
A law came into effect last week making it a criminal offence to force someone into marriage. The offence carries a maximum seven- year jail sentence.
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