Legal sector hit by Semple Fraser administration
SCOTLAND’S legal sector suffered a major casualty yesterday when Semple Fraser confirmed that it intends to call in administrators.
More than 100 jobs are at risk at the commercial property specialists, whose main office is in Glasgow, with other offices in Edinburgh and Manchester, after it said it had “exhausted all options” to save the firm.
The move towards administration is virtually unheard of for a Scottish law firm, although English firm Cobbetts took that route earlier this year.
Semple Fraser managing partner Simon Etchells had raised the alarm on Tuesday by revealing that the firm had reduced its costs and was “reviewing the business and our alternatives”.
Speculation then emerged that the firm – structured as a limited liability partnership – had been approaching rivals to take on parts of the business through mergers. Dundas & Wilson and Manchester-based Weightmans had been touted as possible candidates.
Maclay Murray & Spens (MMS) yesterday denied it had been in talks to take over Semple’s Glasgow office. But MMS managing partner Chris Smylie opened the door to Semple partners and lawyers, saying that MMS was “an attractive destination for senior lateral hires”.
He added: “We know that Semple Fraser has a lot of top-quality clients and first-rate people and, of course, we are always looking at opportunities.”
Semple Fraser, which has 20 partners and has included Tesco among its major clients, said it had lodged a “notice of intention” to appoint administrators. RSM Tenon is nominated for the role, which would be expected to involve realising the value of the firm’s assets, such as fees owed and work in progress, on behalf of creditors.
In a grim statement, the 20-year-old practice admitted it had been “severely affected by the downturn in the economy and the dramatic contraction in parts of the corporate, property and construction sectors in particular.
“Following an exhaustive review of the business, the partners have decided that the business is no longer sustainable,” the statement added.
Etchells said: “It is with great regret that, after having considered every possible option to secure the future of the business, it was clear that administration is the only option.”
Semple Fraser is the first major firm north of the Border to fail to overcome its troubles in a sector that has been beset by rapid consolidation.
Last year, UK firm DWF acquired Scottish practice Biggart Baillie, and Andersons Solicitors merged with DAC Beachcroft. Scottish “big four” firm McGrigors was taken over by Pinsent Masons and Burness agreed a tie-up with Aberdeen-based Paull & Williamson. But others have not been so successful at finding a partner.
Lorna Jack, chief executive of the Law Society of Scotland, said: “It is very sad news to hear that Semple Fraser is to appoint administrators. Many law firms have struggled during the economic downturn, however that is no consolation to those who make the difficult decision to close their business and the impact it has on their colleagues.
“It’s our understanding that the partners at Semple Fraser have explored and exhausted all options to try to secure the future of the business.”
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Thursday 20 June 2013
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