The push among regional players to consolidate continues with news today (2 March) of one of the most notable deals seen outside the City in recent years; Midlands players Shakespeares and SGH Martineau have confirmed they are in talks to merge in a deal that would create a top 50 UK law firm with combined revenues of over £75m.
If successful, the merger would create one of the largest law firms in the Midlands and a practice with a sizeable national network, a staff headcount of 900 and 150 partners. The combined firm would jump up the LB100 table, ahead of fellow Birmingham-outfit Gateleys, which posted turnover of £71.7m for the 2013/14 year.
Staff at both firms were informed of the talks in an internal memo sent out on Friday afternoon (27 February). A joint statement released today said: ‘Each firm excels in distinct sectors with little overlap, making it a neat fit between the two.’
Shakespeares chief executive Andy Raynor and SGH Martineau managing partner Emma Shipp added in the statement: ‘Our firms only contemplate mergers where we believe that there may be significant benefit for our clients, our sectors, our people and our community. We’re in the process of confirming the benefits that a combination may bring and our working relationships to date have been friendly, positive and strong, demonstrating a shared sense of values.’
Shakespeares performed above trend in the 2013/14 financial year, with revenue rising 10% to give the firm a turnover of £50m. In contrast, SGH Martineau saw revenue fall by 4% to £27.5m.
If the talks are successful, this will be the latest in a string of mergers for the acquisitive Shakespeares, which notably combined with Leicester-based stalwart Harvey Ingram on 1 August 2012. In 2013 the firm acquired another Leicester practice, Marrons, as well as Coventry-based Newsome Vaughan while obtaining an alternative business licence (ABS) to cater for its insurance clients. The 103-partner firm has also made little secret of its ambitions to build a substantive City practice through a merger or team hire.
Shakespeares has also recently undergone a change in management, with chief client officer Andy Raynor (pictured, above right) appointed chief executive last month in place of Paul Wilson. Speaking to Legal Business at the time, Raynor said the firm should have the personality of a ‘feisty teenager rather than somebody who is substantially set in their ways’.
He added: ‘We still have ambitions from our regional base to become a national firm, and that means that acquisitions and growth which are part of our DNA will continue when we find appropriate partners.’
For more on the consolidation in the UK regional market, see this analysis piece ‘Pretenders to the throne’ (£)