Slater & Gordon has refused to clarify the prospects of almost 200 people whose jobs appear at risk following its £33m takeover of Manchester firm Pannone.
The listed Australian firm capped a week of merger talk involving mid-sized firms by confirming plans to acquire the majority of Pannone. Slater & Gordon said the acquisition would propel it into the top two slots for market share in most consumer law practice areas. Pannone’s corporate division, Pannone Corporate, will retain the brand for services to businesses under the ownership of current partners.
The deal involves £18.5m in cash at completion and shares worth £3.5m, tied in for up to three years. A further £7m cash and £4m in shares will be paid and issued over the next four years.
Pannone’s current Manchester office will be ‘maintained initially’, with ‘brand integration’ to occur over time, Slater & Gordon told the Australian stock exchange. Slater already has a Manchester base, with 36 solicitors working less than a mile away from Pannone’s head office.
The statement also noted that 400 Pannone staff will transfer after the acquisition is complete in February 2014. The Gazette understands the firm employed 587 people at start of July, the most recent figure available.
A spokeswoman for Slater & Gordon refused to confirm how many staff will stay on in the corporate business and how many of the remainder could face redundancy.
Slater & Gordon head of UK Neil Kinsella said: ‘It’s not appropriate for us to divulge the details of confidential discussions between Pannone and their staff.’
In the past two years Slater & Gordon has bought all or part of Russell Jones & Walker, Fentons, Taylor Vinters, Goodmans and Pickerings.
Elsewhere, south-east firm Blake Lapthorn confirmed ‘first-stage’ talks with top 150 rivals Morgan Cole and Boyes Turner to create a combination that jointly posted £94m revenue last year.
Top-60 firms Wragge & Co and Lawrence Graham have confirmed they are in talks to form a £170m-plus practice. York firm Denison Till said it will merge with Leeds-based Lupton Fawcett Lee & Priestley from this week.
Tony Williams, principal at legal consultancy Jomati, predicted high levels of merger activity for at least three more years.
‘We should expect significantly more as it’s really only one part of the sector - personal injury - that has gone through so many changes,’ he said.
‘Looking at the half-year figures released so far it’s easy to say everybody is doing well, but we’ve only had about 10 or 12 firms announcing. For every one doing well you will have two or three struggling to hold their own.’