Credit hire and legal services group set to raise £25m from listing

Alan Sellers

Sellers: market opportunity

A group bringing together credit hire and legal services is to list on the stock exchange this week.

Anexo Group has recently obtained an alternative business structure licence for Liverpool firm Armstrong Solicitors, which will be renamed Bond Turner on its admission to AIM.

The plan is to grow the firm both in terms of staff numbers – including employed barristers – and geographically.

Anexo is the recently created group owner of a series of businesses, including Bond Turner and credit hire firm Edge. It is owned by barrister Alan Sellers and his solicitor wife Samantha Moss.

Anexo has raised £25m from investors and will be valued at £110m when trading starts on Wednesday.

The placing will raise £15m for the company and £10m for the selling shareholders. The company recorded turnover of £45m last year, with profits of £14.6m.

It will join the likes of NewLaw Solicitors, Principia Law and Markel Law as law firms owned by listed businesses, the latter by the New York-listed insurance giant.

Rather than receive work from claims management companies or insurers, the group said it has a field sales team generating almost all of its road traffic accident customers from a network of around 1,000 active referrers, such as body shops, vehicle workshops and recovery agents.

Anexo provides the motorist with a credit hire vehicle, the upfront settlement of repair and recovery charges, and legal support for a claim.

In a statement issued to the stock exchange today, the company said its model of direct capture of customers and claims management through a wholly owned law firm differentiated it in the market.

“This enables the group to generate and screen high-quality, profitable cases and to process them to their conclusion…

“Anexo is focused on the impecunious customer, typically individuals who do not have the financial means or access to a replacement vehicle, which allows the group to recover credit hire rates which are significantly higher than upfront spot hire rates.”

Bond Turner has around 200 staff, including 127 fee-earners, including in-house barristers. As well as credit hire and personal injury claims, it handles professional negligence work through its Been Let Down brand.

The group also operates Professional and Legal Services Ltd – which arranges experts, interpreters, photographic reports and consultants – and IGCA 2013 Ltd, which provides after-the-event insurance.

It said listing would help grow the business: “At present, the vast majority of claims are settled by negotiation, partly driven by the group’s need to preserve working capital.

“This has historically restricted recovery rates to approximately 50% to 60% of the gross hire claim. The funds raised on admission will provide an opportunity to increase these recovery rates, with greater funding reducing the need to accelerate settlement by accepting a lower offer.”

But the announcement stressed: “The individual does not suffer loss in these negotiated settlements as the injury claim is settled in full.”

The listing will also enable the growth of Bond Turner. With further expansion in Liverpool “constrained by the availability of high-quality recruits”, it will look to open new offices, with Manchester likely to be the first location.

“Additional funds raised will also allow the group to bring more barristers in-house, so that work does not need to be given to other chambers. These additional barristers would be paid a basic salary and receive a share of fees, which will retain more profit in-house.”

Similarly, Anexo will look to increase the number of sales agents and vehicles available for hire.

“Furthermore, Anexo intends to grow market share in a consolidating market and take advantage of opportunities that may arise following the anticipated introduction of the Civil Liability Bill in April 2019.

“The directors believe that changes to regulation will present an opportunity as law firms change strategy and exit the market.”

Mr Sellers, Anexo’s executive chairman, is a barrister at Liverpool Civil Law Chambers who also practises as one of the company’s in-house barristers. Ms Moss is managing director of Bond Turner.

Mr Sellers said: “Over the last 20 years our highly specialist team has worked hard to build Anexo into an integrated credit hire and litigation focused group. Joining the London Stock Exchange and raising £15 million for the company will remove the constraints to enable expansion of our proven model and deliver significant organic growth in the future.

“There is an ever-increasing UK credit hire and legal claims market opportunity and our focus on impecunious claimants has allowed us to create a business that we believe will scale quickly and generate near-term returns for our new shareholders.”

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