An old Fleet Street adage has it that ‘Good news is not news’. That’s a journalistic principle to which I generally adhere. Attempts to launch media outlets with a Panglossian outlook – and there’ve been a few – have foundered.
This week, though, I shall make an exception. Alternative business structures remain controversial, and for good reason. Yet the agility that non-lawyer ownership and funding confer can be transformative.
Consider two contrasting examples, both of them turnaround stories. Co-op Legal Services, notoriously hailed as a ‘game-changer’ when it became one of the first ABSs in 2012, quickly landed itself in all sorts of trouble. Growing too fast and with the hubristic ambition of sweeping away fuddy-duddy high street firms, the business racked up losses in the millions.
Long-time readers will remember Co-op’s marketing director infamously declaring that putting consumers at the heart of what they do is ‘alien’ to solicitors. The Law Society was predictably outraged.
Yet look at the firm now. Sensible investment and shrewd consolidation in its core markets have yielded a bumper Co-op ‘divi’. The mutual’s legal arm has doubled income and quintupled profits in the last four years alone. Yet had it not been for the heft of its parent, it might not have survived at all.
My second example is Slater and Gordon. That firm’s – ahem - storied history could fill a decent non-fiction volume for the business section of your local Waterstones. No room to dwell on that here. Suffice to say that trading profits are now surging as the firm moves away from low-value personal injury work.
Gone are the days when Slater sparred with the Gazette over what we’d written, fiercely disputing which incorporated entity’s accounts gave the most pertinent picture of the firm’s financial health.
Once again, however, the bigger story is what the proprietor, in this case investment house Anchorage Capital, has the capacity to do. Slater’s latest accounts are most interesting for a post-balance sheet event – the May 2025 share issue that raised £30m for working capital and investment.
There is more to do at Slater and I don’t quite see where Anchorage’s exit lies. But still. Like the Co-op, the firm might well have disappeared by now but for its ultimate owner.
No comments yet