Ward: Diversification strategy
Listed law firm Gateley has made good on its intention to increase the non-legal services it offers by buying a leading land referencing consultancy.
Persona Associates Ltd advises on some of the UK’s largest infrastructure and regeneration projects, providing expertise on statutory processes relating to long-term infrastructure projects involving compulsory purchase orders, development consent orders and Transport and Works Act orders.
Gateley is paying £250,000 up front, of which £154,000 will be paid in shares at a price of 163p. The shares closed yesterday at 166p.
Deferred consideration will be payable next May, subject to hitting certain targets, settled 60% in cash and 40% in shares.
Investors were told that the acquisition would be “immediately earnings enhancing”.
Announcing its annual results recently, chief executive Michael Ward said [1] the aim was for non-legal revenues to make up 20% of Gateley’s turnover – it is currently 12.4%, or £12.8m.
Persona has worked with the group’s property consultancy business, Gateley Hamer – the firm’s second post-listing acquisition in 2016 – for a number of years.
In a statement to the stock exchange, Gateley said: “The acquisition will enable Gateley Hamer to deliver additional value added land and property information via an end-to-end service for the country’s largest infrastructure, regeneration and housing projects.
“The addition of the Persona team will also deliver efficiencies to the production of title reports for housebuilders and commercial developers and enable plans to be produced at an earlier stage in order to support Gateley Legal’s residential development and real estate teams.”
Mr Ward added: “This is an exciting opportunity for the group and sits within the diversification part of our strategy to establish complementary business services that support the legal side of our business.
“We believe there is also an opportunity for Persona to develop within our property group in the same way that Gateley Hamer has done in the last three years.”