Irwin Mitchell finally gets keys to ABS warchest
20 August 2012 | By Sam Chadderton
3 September 2012
12 December 2012
19 October 2012
8 February 2013
12 December 2012
Irwin Mitchell has been given ABS approval and become the first business to be granted multiple licences for the range of businesses within its structure
The firm was among the first to show its hand on ABS when in April 2011 (25 April 2011) it unveiled plans to generate a £50m warchest of external investment and then applied in the first week of January this year for ABS status.
Group chief executive John Pickering has previously stated his ambition to take on the mdi-tier corporate firms through merger and acquisition once ABS was endorsed.
The SRA has also approved the appointments of Glyn Barker, the former vice-chairman UK of PricewaterhouseCoopers, as chairman of Irwin Mitchell’s parent company, IMCO Holdings, with immediate effect and Mel Egglenton as a second non-executive director and chair of the company’s audit committee, a role he previously held with accountants KPMG.
With 60 solicitor members, five non-solicitor members, 75 salaried partners, 20 non-solicitor directors and associate directors and 2,200 staff across seven UK offices, Irwin Mitchell is the largest firm yet to convert to an ABS.
It was also one of the first law firms to convert to Legal Disciplinary Practice status in May 2010, promoting non-lawyers to its equity structure for the first time.
The five licences granted to Irwin Mitchell cover businesses operating separately within the firm’s group structure, including Irwin Mitchell LLP; Ascent Collections Ltd, which offers field agency and debt collection services; Coris UK Ltd, which offers international assistance and insurance claims handling services; Irwin Mitchell Trustees Ltd, which accepts appointments as a trustee, executor and estate administrators; and also to Irwin Mitchell Trust Corporation Ltd, which accepts appointments to act as deputy from the court of protection.
Irwin Mitchell owns the Spanish legal practice Irwin Mitchell Abogados, which has offices in Madrid and Malaga. That fits into the structure, but is a subsidiary business governed by Spanish regulations and Irwin Mitchell Scotland is an affiliate company not part of the ABS.
Pickering said: “This is a major step forward for Irwin Mitchell as a group and we’re delighted that we’ve received the licences for which we applied.
“It’s a very significant day for us, an important milestone which positions us well to take advantage of the opportunities which we think will arise from the changing legal landscape.
“We can now push on with our plans for growing the business.
“Conversion to ABS status sends a clear signal that we intend to move forward with our strategy and we’re pleased to be the first multi-licensed ABS, which reflects the breadth of our offering to clients.
“Our group structure has been built with that strength of diversity in mind and we believe it puts us in a very strong position in the changing legal sector.”
He added: “Receiving our licence also enables Glyn Barker and Mel Egglenton to take up their roles with us fully. Both are high quality and experienced additions to an already well-respected senior management team.”
The litigation-heavy firm recorded a seven per cent turnover rise for 2011-12, up from £171.8m to £183.7m in the firm’s first full 12-month period with its new corporate structure in place under parent group Irwin Mitchell Holdings.
The firm is split between business and legal services and has prepared for ABS conversion by bringing in Barker in January to succeed Michael Napier (16 January 2012) .
Paul Firth also joined in October last year to develop the business services side, working closely with head of business, Niall Baker.
A large chunk of income is generated by the litigation practice, which contributed 85 per cent – approximately £156m – of total turnover in the last financial year, with the firm focusing on insurance, personal injury and medical negligence.
But with the option now of outside investment, the firm looks set to go on the acquisition trail to balance its portfolio.
The SRA’s ABS total is now at 19.
Antony Townsend, SRA chief executive, said: “The ABS total is gathering pace as is the variety of models that we are seeing emerge. Irwin Mitchell is one of the largest organisations we have authorised so far, and the first multi-licence to be granted. It just shows that the new legislation gives plenty of scope for all types of applications.
“Our authorisation system has been built to be flexible enough to deal with a range of organisations with hugely varying corporate structures and robust enough to apply the same stringent suitability criteria by which traditional firms are judged.
“Irwin Mitchell’s application was different to other applications because of the number of licences involved. The systems we have in place to authorise ABSs are thorough, and we are continuing to make improvements to the process as we gain further experience.”