Legal Business Blogs

ABS latest: Kent Legal Services to open the bidding in search for a JV partner this summer

Kent County Council‘s legal arm is seeking ‘expressions of interest’ from potential alternative business structure (ABS) joint venture partners in advance of a formal procurement exercise to launch this summer as part of the council’s wider programme to raise funds.

Kent Legal Services (KLS) – which is currently in discussions with the Solicitor’s Regulation Authority to become an ABS – has so far received a ‘steady flow’ of interest from a range of organisations, including legal, since the council’s standalone legal services arm began receiving expressions of interest two days ago, said director of governance and law Geoff Wild (pictured) today (10 April).

In a separate process, organisations will be invited to tender to become a joint partner to the council in the early summer with a partner expected to be selected before Christmas. The process will be led by Kent County Council’s (KCC) dedicated procurement team, which will be responsible for overseeing the review of all other parts of the council as part of its ‘Facing the Challenge’ transformation programme.

The programme ‘sets out KCC’s commitment to meet the growing gap between resources and needs’ as a result of reductions in government funding among other pressures, according to the summary for the council’s legal services market engagement exercise.

‘The procurement process will be for a JV partner, and for that partner to create an ABS which will not only deliver services back to KCC but also to operate more widely in the market, offering its services to other clients as well,’ said Wild. ‘So there will be a tendering exercise for a partner to create a vehicle to deliver Kent’s legal services and then for that vehicle to go and trade more widely in the market.’

‘We are testing the market at the moment and are interested to see what comes back in terms of organisation and ideas, and are looking to do a formal procurement process, subject to the full business case justifying it, in early summer,’ he added. ‘There are a lot of organisations who want to get into the legal market, into the public sector, or who are already established in the public sector but don’t have a legal presence, equally some really good law firms who want to explore different ways of doing things.’

KLS, which first revealed its intention to find an ABS JV partner in May 2012, is unique among in-house departments for generating income as a result of offering its services to external county councils. Last August it announced a rise in 2012/13 profits of 20% from £2m to £2.4m and a 9% increase in turnover from £11m to £12m. This represents an improvement on last year’s performance, when profit increased by 18% to £2m while turnover was up 10% to £11m.

KLS currently provides ad hoc legal services to over 300 public sector bodies nationwide. In 2010 it set up Law:Public; a joint venture with Geldards aimed at further extending its geographical reach and the range of services. Its profits together with £1.3m in efficiency savings means KLS has contributed £3.7m to the county council in the last year.