It would surely have happened sooner but for the financial meltdown of 2008. More than 10 years after Sir David Clementi produced his landmark report proposing liberalisation, Anglo-Scottish outfit Gateley today becomes the first UK law firm to float on the London Stock Exchange.
It will not be the last. As you read this, seven leading partners at the commercial firm should be sitting pretty on a £20m share pile (though they are subject to a lengthy lock-in).
That’s some nest egg, at £2.4m-£3.1m each. And only 30% of the firm is on offer.
It will be discomfiting for some solicitors that the law is now vulnerable to being commodified in this way. How will the duty to maximise profits for investors coexist with the duties to act in the best interests of clients and as officers of the court? Of course there is a precedent, of sorts. Slater and Gordon, acquirer of RJW and listed in Australia, does not seem to have encountered problems and is growing fast.
What Gateley will have to get used to is a much higher degree of day-to-day scrutiny. How will the share price fare? What will the analysts say? Will the new company deploy its new capital to lure talented teams from rivals, dangling the carrot of share options? Which institutional investors will move in on the firm and how will they exercise their power?
The legal world is watching. A fascinating experiment has begun.