Best for Legal Sector M&A - UK
Zebra Legal Consulting
ZebraLC has advised in a number of landmark deals within the legal sector. These deals are unprecedented by the fact that new entrants have entered the UK legal market for the first time and generated a growing M&A sector. We spoke to them about their success as well as their strategy behind the smooth running of major deals.
In 2014, Zebra advised on technical & WIP due diligence in Fairpoint Group PLCs £15million acquisition of national law firm Simpson Millar. This was an unprecedented deal for the AIM list company and was a deal highlight of the year. Also in 2014, Zebra advised on technical and carried out the WIP due diligence for private equity firm, North Edge Capital, in the £15million investment into the UKs leading Industrial Disease firm, Roberts Jackson. Other parties within these deals included KPMG, Deloittes and BDO. As accountants, their focus was on financial due diligence.
Carrying out technical and WIP due diligence in new entrant deals such as these was unchartered territory for our company. Moreover, ZebraLC’s unique approach to technical WIP due diligence in M&A within the legal sector did not exist prior to its inception in 2012. These particular deals also required a bespoke approach as both included areas of personal injury, which at the time was in the early stages of regulatory and political change with the advent of LASPO (Legal Aid, Sentencing and Punishment of Offenders Act 2012.)
“Understanding and diligencing complex legal matters across a variety of contingent and non-contingent work-types required a particular blend of legal and financial expertise and this is exactly what ZebraLC brought to the evaluation process,” said Tim Ritchie, Head of M&A, Fairpoint Group PLC.
From our experience, greater visibility and a deeper understanding of legal business financial profile (including WIP profile), value and operational risk are fundamental to M&A. ZebraLC has managed not only to keep in step with this change, but to anticipate it. Our methodology is unique to us and our clients value our role as part of the due diligence process.
As a small niche business, and also a young one, we have had to stand shoulder to shoulder with international accounting firms. This is fantastic opportunity for us. There is really no-one else in the sector that delivers what we deliver and what we do compliments the role of the accountant. Historically, the assessment of WIP valuation has been firmly set within the remit of accountants. With the onset, for example, of the flourishing personal injury M&A sector, the growth of specialist caseload and technical due diligence to assess WIP, technical capability and operational risk is ever present.
The aim of specialist technical due diligence is to get to the heart of key indicators of WIP value and caseload risk profiling. Highlighting and then assessing trends throughout the caseload is a fundamental part of the process. It requires a combination of technical, financial and commercial skill. The role of an experienced costs expert is also critical to assess retainer and funding risk.
Further, ZebraLC operates within a highly regulated environment and as such carrying out due diligence on SRA regulated law firms requires us to put law firm clients and thus consumer confidentiality at the heart of our approach. Assessing technical capability and WIP means that the team have to assess individual client matters. This was particularly relevant in the new entrant M&A process. Our M&A approach and process adheres to the guidance and rule provided by the Solicitors Regulation Authority.
When working on major transactions, understanding the critical path of the due diligence process is fundamental for the smooth running of the deal. ZebraLC manages its due diligence process according to its Project Assurance Plan which takes a measured and risk based approach. As a niche specialist, our ISO 9001 accreditation as a legal sector technical due specialist is also invaluable. Open and structured dialogue with both the client and target is also fundamental to the smooth running of the due diligence.
As for the current climate in our industry, the UK legal sector has seen seismic changes as a result of political, economical and regulatory forces. This has led to unprecedented M&A within the sector, and new entrants such as Fairpoint Group PLC entering the market. Without the advent of ABS (alternative business structures) within the UK legal sector, deals like this would simply not have been possible.
It is a proud moment for us to win this award. It is the culmination of our innovation, tenacity and unique UK legal sector understanding that has got us to this point. Most of all, it is testimony to the talent of our biggest asset; our people.
Furthermore, this award provides businesses like us with an invaluable profile. This is even more so because we are small, unique and niche. Our work comes through reputation and credibility and the exposure to awards like this enables us to shout out to the wider industry. Its about front of mind’ PR coverage.
Internally, this award rewards and recognises the hard work of our people and this is just as valuable to us. It's provides a moment to reflect on how far we have come in under 3 years and recognise the value of our unique role within legal sector M&A.