Smith: Acquisitions inevitable
Business rescue and recovery firm Leonard Curtis is eyeing acquisitions as part of plans for major growth of its law firm, Legal Futures can report.
The aim is to double the £2.6m turnover of Leonard Curtis Legal (LCL), an alternative business structure launched six years ago [1], within the next three years.
Last autumn, multi-family investment office Arete, in partnership with investment and acquisition vehicle Svella, paid £15m for a significant stake in Leonard Curtis Business Solutions Group, which valued it at £40m.
With 240 staff working across 18 offices in the UK and the Channel Islands, the group is the largest privately owned professional services provider of corporate restructuring and insolvency in the UK. In 2020/21, it generated revenues of £26m and profit after tax of £4.8m.
LCL formed part of the group’s strategy in recent years to create a multi-disciplinary approach to problem-solving for SMEs at every stage of the business lifecycle.
Group chief executive Daniel Booth told Legal Futures that the amount of work LCL was attracting from outside of the group has grown rapidly. When LCL was launched, he expected 75% of its work to come from the “internal market” of Leonard Curtis and the rest from outside. That split has now flipped the other way.
This is in large part due to the Lifecycle Network, a support service for regional accountancy firms provided on the basis that Leonard Curtis does not seek to usurp their client relationships. It is the same idea as Pannone’s old Connect2Law network.
LCL director Paula Smith, a solicitor who joined the firm last year, explained that “all those accountants who work with Leonard Curtis were happy to embrace legal”.
“We are seen as part of the team. People want us to be involved because we’re seen as a problem-solver like the rest of the group.”
She said LCL, despite only currently having 23 staff, “punch above our weight with the size of the transactions and the volume”. It already offers corporate, banking and finance, commercial, litigation and debt recovery services, and has recruited two lawyers to start a commercial property practice too.
Such is the focus on building LCL’s external relationships that, in the event the firm is too busy, it is the internal work that is farmed out to other law firms. Mr Booth said it was “easier to have the conversation” with internal clients.
He continued that, on the back of the investment, the plan was to double size of the business in next two to three years, with legal and commercial finance two key growth areas.
LCL would look to recruit – although it was tough to do so at the moment – but Ms Smith said acquisitions would “inevitably” be part of this.
Mr Booth went on: “They’ve got to be the right ones. You’ve got to make sure the culture fits. What most people don’t work out is that, whilst the numbers might fit, most important is the bit that you do after you’ve done your deal, which is integrating and not necessarily thinking that the way you do it is the right way.
“There’s an assumption that the acquirer is the way you’re going to do it. There’s a bit of arrogance around that.”
LCL is currently based in Leonard Curtis’s Manchester headquarters but has three lawyers in the London office and is planning to locate lawyers in the Leeds and Birmingham offices as well.