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More than 200 DWF partners to benefit from listing

Stock exchange: DWF shares to start trading on Friday

More than 200 partners of DWF are selling shares as part of this week’s stock market listing, it has emerged.

They will initially receive £19.5m collectively for selling a small proportion of their shares (16 million) for the float, but will continue to hold around 63.5% of the company’s stock – nearly 191m of the 300m total of issued shares post admission.

These shares subject to a lock-in until 2024 that allows small proportions of their shareholdings to be sold each year.

The shares will start trading publicly on Friday [1], it was announced yesterday, at a price that values the international law firm at £366m.

The formal prospectus for the firm, also published yesterday, said that as of 31 October 2018, there were approximately 225 partners, based in seven different jurisdictions, who would be selling shareholders,

At that date, DWF had a total of 316 partners, of whom 69 were equity partners, 174 fixed-share partners, and 73 ‘partner-equivalents’.

The prospectus did not outline who held what except in relation to the board and senior managers, the latter being members of DWF’s executive board.

CEO Andrew Leaitherland currently holds 3.2% of DWF’s shares, but this will fall to 2.4% after admission as he is selling 628,000 shares, which are priced at 122p, and the firm is issuing 61m new shares to take the total to 300 million.

Matthew Doughty, head of corporate in London, is the partner director on the board. He is selling 303,000 shares and will have 0.9% of the stock from Friday.

The senior managers are Glyn Jones, head of the catastrophic injury team, and Stephen Miles, CEO of the commercial services division (both selling 273,000 shares, leaving 1.2% shareholding each), Stefan Paciorek, CEO of the international division (selling 239,000 shares, leaving 1.1% shareholding) and Jason Ford, head of Connected Services (selling 10,000 shares, leaving 0.1% shareholding).

Finance director Chris Stefani and HR director Helen Hill do not hold any shares but will each be awarded a cash bonus of £500,000 between them on admission, and receive 1.1 million and 238,000 shares respectively.

Chairman Sir Nigel Knowles, who receives an annual fee of £200,000, is selling 243,000 shares, leaving him a 0.9% shareholding.

The firm’s employee benefit and reward share trusts are selling 2.3m shares between them and will have a post-admission holding of 10.5% when put together.

Investment funds Miton Group plc, Sand Grove Capital Management and Standard Life Aberdeen plc will be the major external investors, each with 4% or a little more of the shares.

Mr Leaitherland will receive a basic salary of £530,000, plus discretionary bonus capped at 150% of his salary and a pensions allowance equal to 7% of salary.

In the year to April 2018, his profit share was nearly £900,000 – he has spoken about the partners taking a “haircut” as a result of the float.

Still on pay, the prospectus said the compensation of self-employed members of the LLP would participate in a partner annual bonus pool that would be equivalent to up to 5% of the group’s profit before tax for the year.

The intention is to increase DWF’s gross profit margin from 50.4% by another five or six percentage points.