Leaner and better managed firms are making their mark now as they benefit from the fallout from less successful firms that have struggled to manage their practice effectively and just can’t carry on any longer. The most recent examples in Leeds and Manchester …
Brooke North – 3 January
One of Yorkshire’s oldest law firms, Brooke North, has closed after being hit by the recession. All 15 lawyers at the Leeds-based practice, which is thought to have been established around 150 years ago, have found work at other firms. Rodney Dalton, a senior figure at Brooke North for 16 years, said the effects of the economic downturn and the firm’s business model had impacted on recent performance.
Mr Dalton said Brooke North’s approach of offering a bespoke service for its clients across different areas of law, rather than a “one stop shop” for all its clients had actually had a negative effect. This was because many of its owner-managed business clients had stopped using the firm when the recession hit as their own organisations had been impacted by the downturn and other work hadn’t filled the gap, he said. “If you add all that up it doesn’t present a particularly encouraging picture,” Mr Dalton said. “We tried to do a deal with our landlord to enable us to continue, albeit in a slightly different format. But unfortunately we couldn’t do a deal. “We then looked at ourselves and another problem was there was little opportunity of a solution across the board. We didn’t have the bulk stuff such as second mortgage items to fall back on.
“We prided ourselves on giving a bespoke service to individual clients. The recession just slaughtered us.” Mr Dalton, a property expert who has joined Lupton Fawcett following Brooke North’s break-up, said the firm had considered a merger with another firm but had decided against the move. He also claimed the firm had been approached itself by suitors in more prosperous times. “All we could see is that in 2012 we’ll be looking back at 2011 and saying that was a good year,” he said. “In the long run a takeover might have done us less good than a break-up has done. This has given us the opportunity to negotiate our own deals.” The majority of the remaining staff at Brooke North, which numbered around 30, have found work elsewhere.
Rowlands Field Cunningham – 22 December
LAW firm Linder Myers has bought the business and assets of fellow city centre firm Rowlands Field Cunningham from administrators. Insolvency firm MCR were appointed as joint administrators of Rowlands Field Cunningham on 22 December. Linder Myers has said the deal will create a £16m-turnover business with almost 300 staff, including 43 partners. It will take on all 80 former Rowlands Field Cunningham staff currently operating out of offices on York St in the city centre and in Swinton. The last filed accounts for the 12-partner Rowlands Field Cunningham show that the firm had a turnover of £4.8m in the year to April 30, 2010, but no profit was declared.
Rowlands was established in 1887 and only merged with Field Cunningham just over a year ago – a deal which was described at the time by managing partner Jon Andrews as “a very good fit”. However, the firm is understood to have since suffered with cashflow, which eventually led to it appointing administrators. Bernard Seymour, managing partner of Linder Myers, who will head the enlarged practice, said he expects to achieve turnover of £16m in the next financial year and £20m within 18 months.
Earlier this year, Linder Myers bought an eight storey, 47,500 sq ft building at 55 Spring Gardens for its new headquarters building. It paid £8.1m. Mr Seymour added that Linder Myers would continue to seek further mergers in Manchester and was in discussions with a number of potential targets. “This is our biggest merger to date. It will give us greater critical mass and expertise, and will enable us to penetrate better in some markets,” he said.
Berkson Wallace from Ellesmere Port in administration, June 2012
Founded in 1902 fell, based in Ellesmere Port with work across the North West, employing 12 staff and posting turnover of about £400,000. It has been run by its current partnership team since 2006 and specialised in property transactions, personal injury and matrimonial matters. Skelmersdale-based Refresh Recovery, which is currently managing the firm’s affairs, said it had suffered under a downturn in the property market and general economic malaise. “Prior to administration, most of the clients’ files transferred to other firms of solicitors,” Refresh told Insider. “All staff at the Ellesmere Port office, including the partners, have been dismissed but most of the staff in the Wallasey office transferred to another firm.”
Courtesy of TheBusinessDesk