On the face of it, news that Bristol-based TLT is to open simultaneously in Scotland, by acquiring niche firm Anderson Fyfe, and also in Belfast, by hiring a small team of local lawyers, is hardly earth-shattering.
But while the news may be dominated by major international firms’ expansion plans in Asia, or even significant full-scale tie-ups such as McGrigors and Pinsent Masons, you could argue that, relatively speaking, low-key moves such as TLT’s make better strategic sense for all concerned.
In Scotland, TLT has added just £3m to the top line after taking on Anderson Fyfe’s eight partners. The Scottish firm is top-ranked for debt recovery, on the panel of banks such as The Royal Bank of Scotland, and has a good all-round commercial litigation practice.
This complements TLT’s national reputation for its banking litigation practice, advising key clients such as Nationwide, J.P. Morgan and Barclays on debt recovery, mortgage fraud and professional negligence.
In Northern Ireland, TLT is not mimicking the moves made by Allen & Overy and Herbert Smith to provide clients with cheaper services from a low-cost centre in Belfast. The aim is to grow market share in Northern Ireland. Managing partner David Pester says both the new office openings are a response to demands from existing financial services clients, which make up 40% of the firm’s revenues. As Pester told LB as part of the LB100 report last September: ‘To be a generalist firm in such a big fragmented market, particularly below the top 50, can be quite a challenge if you don’t have something that positions you as quite specialised.’
This move is about recognising the need to increase market share in an area that the firm is pre-eminent.
Pester will make no bold claims about challenging the legal elite in Scotland or Northern Ireland, nor should he. This move is about recognising the need to increase market share in an area that the firm is pre-eminent. TLT, since its formation in 2000, has been prudently managed. The firm first established itself properly in its home market in Bristol before branching out cautiously in the City in 2005. Over the years, Pester has consistently told LB that the firm’s focus has been on sustainable growth, explaining away the firm’s consistently modest progress, avoiding massive leaps in profits and revenue compared to local and national rivals. That steady progress means that the firm hasn’t suffered the pain felt by many in the market. The firm’s compound annual growth rate between 2006 and 2011 is 8%, better than the average growth across every LB100 peer group bar Insurance. The firm’s forecasted turnover for 2012/13 is £48m, and its revenues have tripled since 2002. Profit per lawyer of £28,000 and a PEP of £288,000 means TLT is never going to be the destination of choice for the avaricious, but for the realistically ambitious it could be a happy home.