Law firm Shepherd & Wedderburn to recruit amid merger deals

By PETER RANSCOMBE AND TERRY MURDEN
Published on 07/10/2012 00:00

LAW firm Shepherd & Wedderburn is attempting to lure lawyers who are dissatisfied with the wave of mergers and acquisitions that are sweeping through the Scottish legal sector.

Stephen Gibb, chief executive of the “big four” firm, said his practice was not in takeover talks but he declined to comment on whether it had been approached to take part in a merger.

Instead, he said he aimed to pick up solicitors who are unhappy with the merger of their firm.

Gibb said there was “no pressure” on Shepherd & Wedderburn to take part in corporate activity because the firm has £3.7 million of net cash on its balance sheet.

Several sources within the sector have suggested some Scottish law firms are carrying a lot of debt and could be forced into M&A activity to survive, with more lawyers chasing less corporate work during the recession.

Gibb said: “We’re looking at what’s happening in the Scottish market at the moment. There will be opportunities to pick good people up in this market because some of the deals that have happened recently will not appeal to all the people in the firms.”

Gibb is also looking to grow his firm’s property team in London, but ruled out moves into other regional markets in England. He added: “We are in a position where we do not have to do a deal. That’s a good place to be right now.”

Keith Anderson, chief executive of legal services provider Vialex, questioned the benefits of the current wave of mergers. He said they are being done to cut costs or create a one-stop shop that provides a full service to clients.

“But clients do not necessarily want to take all their advice from one firm. There are benefits in smaller firms focusing on those services they specialise in,” he said. “While there may be immediate savings following a merger, it does not deal with the underlying issues facing the industry.”

Gibb’s comments came as Shepherd & Wedderburn revealed its turnover was flat in the year to 30 April, at £37m – leaving the firm’s profits flatlining at £12.9m. The practice’s headcount was flat over the year, at just over 400.

Deals in which the firm was involved last year included acting for Chivas Brothers, Scotland’s second-largest distiller, in a £60m joint venture with a group of other whisky makers and Aim-quoted 
Helius Energy, the waste-to-power firm backed by investors Ann Gloag, Angus MacDonald and Alastair Salvesen.

Other deals for the law firm involved property clients such as British Land, Miller, Sainsbury’s and Taylor Wimpey.

Gibb, who took over as chief executive in May, said the current financial year had started strongly, with the firm advising Global Infrastructure Partners on its purchase of Edinburgh Airport from BAA.

The firm recently hired George Frier from mid-tier 
rival McClure Naismith to beef up its corporate team in Glasgow, and John Grady, previously of the Faculty of Advocates, to expand its regulation and markets team.

Gibb hopes that reforms of the electricity markets across the UK and the water industry in England and Wales will yield further work for the firm, which includes energy and natural resources as one of its specialisms.