Australian law firm Slater and Gordon has signed a £637m deal for Quindell’s professional services division – a business which generated revenues of nearly £180m in just the first half of 2014.
The division covers legal services mostly relating to personal injury but also includes marketing and motor services. Legal services employees around 1,400 and operates under a range of brands including Silverbeck Rymer, Pinto Potts and The Compensation Lawyers while the complementary services has around a 1,000 staff members.
The firm said it was a ‘transformational opportunity’ though the transaction is conditional on a majority vote by Quindell shareholders, scheduled for 17 April. Quindell’s board has unanimously recommended that the shareholders vote in support of the transaction.
The alternative business structure (ABS) confirmed it was in negotiations with Slater and Gordon at the end of January with the deal expected to reach a final close in May 2015.
Commenting on the deal, Andrew Grech, managing director of Slater and Gordon said: ‘In getting to this point we undertook a very extensive due diligence process. The business we are buying is of high quality with robust infrastructure and systems and good people. This move will accelerate and consolidate our position in the UK market and bring benefits to the clients and staff of both businesses.’
The move is beneficial for Slater and Gordon which is expecting to boost its personal injury market share from 5% to 12%. Last summer, it said it is looking to grow a further 8% in the UK in 2015 with revenues having come in at £100m (A$182.5m) for the 2013/14 financial year. The firm made several acquisitions in 2014 including specialist PIL firm Nowicki Carbone and Queensland consumer law practice Schultz Toomey O’Brien with a combined estimated annual fee revenue of A$39m.
Quindell gained its ABS licence from the Solicitors Regulation Authority in December 2012, and has been growing quickly. At the end of the first half of 2014, Quindell’s legal services division brought in £179.6m – 139% up on H1 2013.
Macfarlanes acted for Slater and Gordon as UK legal adviser to the deal while Arnold Bloch Leibler acted as Australian legal counsel.