After announcing its record £95m IPO on Monday (11 March), DWF has today (15 March) issued 300,000,000 shares and been admitted to the main board of the London Stock Exchange.
With a £366m valuation and offer size of £95m, DWF has officially become the UK’s largest listed law firm. £19m of the proceeds will be used to repay a portion of members’ capital contribution to DWF, with £10m earmarked for IT investment and the remainder reserved for general corporate purposes.
Allen & Overy (A&O) advised DWF on the float, with a team led by London corporate partner Gillian Holgate. A total of 17 A&O offices were involved in the mandate. Holgate commented: ‘This transformational transaction will enable DWF to capitalise on the positive trends in the markets in which it operates and to continue to expand its international and differentiated offerings.’
While it is a record figure, the £366m market capitalisation is below the expected range of £400m and £600m. The £95m capital raise however, trumps the £75m sum that was mooted by DWF in February.
As a result of the IPO, DWF’s equity partners face an upfront equity reduction of 60% – profit per equity partner was £327,000 last year – while non-equity partners can expect to see a profit share reduction of 10%.
Partners will also be locked in for five years, with shares released in tranches of 10% each year following the firm’s financial results in 2020 and a further 10% based on performance. Equity can be release for those considered ‘good leavers’, while ‘bad leavers’ run the risk of having equity clawed back.
The firm’s chief executive, Andrew Leaitherland, is in entitled to a basic annual salary of £530,000 following the IPO, with chief financial officer Christopher Stefani entitled to £320,000.
The previous record for the UK’s largest listed firm belonged to Ince Gordon Dadds, the milestone reached when Ince & Co and Gordon Dadds combined last year.
At press time, DWF shares were trading at 124p.