Stock exchange: Harwood has four weeks to decide on offer
A private equity firm is poised to bid for Frenkel Topping Group, which seeks to offer everything except legal advice in support of personal injury and clinical negligence victims.
Frenkel’s stated aim is to provide “the most comprehensive suite of services to clients and deliver a best in-class service offering from immediately after injury or illness and for the rest of their lives”.
This includes legal costs – it has bought four specialist costs firms in the last four years – as well as expert witnesses, tax and forensic accountancy, independent financial advice, investment management, and care and case management.
It has a signposting partnership service inside NHS major trauma centres, as well as financial advice joint ventures with around a dozen law firms.
Harwood Private Equity, which currently has just shy of 30% of Frenkel’s shares and says it specialises in small-cap public-to-private transactions, announced to the stock exchange yesterday that it was in “advanced discussions” with the group’s independent directors about a possible cash offer.
As currently envisaged, Frenkel Topping shareholders would receive either 50p per share or a mix of cash, loan notes and shares in the ‘Bidco’ adding up to 50p. They would remain entitled to receive the proposed final dividend for 2024 of 1.375p.
With 128m shares in circulation, this values the group at £64m and means Harwood would pay £46m for the remaining shares.
Frenkel Topping’s share price reached a high of 82.5p in February 2022 but has been dropping since to around 37p in recent months. It closed at 43p last Friday and shot up to 49p yesterday after the possible bid was announced.
Under the takeover code, Harwood has until 30 June to decide whether to make an offer.
Frenkel’s 2024 results showed turnover up 14% to over £37m and profit before tax up 31% to £4.2m. Its costs operation – made up of Partners in Costs, A&M Bacon, Bidwell Henderson and NWL Costs Lawyers – accounted for £9.9m of the turnover and £1.8m of profit.
The results revealed that debtor days for the costs segment grew from 309 days to 385, “a result of delays in the court systems”.
“Recent official county court data shows that multi/fast track claims in the period ending June 2024 were taking on average 20.2 weeks longer than they did in 2019, representing a significant delay for those seeking justice, as well as for the group’s cashflow cycle and that of other professional parties involved,” the group said.
“We welcome the justice committee’s new enquiry into the work of the county court, launched on 21 January 2025, to seek to address these issues.”
