BLG and Clydes eye UK top 10 slot with potential merger
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Barlow Lyde & Gilbert (BLG) is planning to merge with fellow insurance firm Clyde & Co, in a deal that would propel the combined entity into the UK top 10 by turnover.
David Jabbari
It is understood that the two firms have been in talks about a possible tie-up for several months.
Clydes chief executive Peter Hasson said the tie-up deserves “serious consideration” given the impact it would have in the insurance market.
BLG chief executive David Jabbari said in a statement that the firm had been exploring a number of different merger options, adding that a tie-up with Clydes has “obvious potential”.
BLG has positioning itself for merger for the last year and has seen a number of exits from its partnership. That said, its headcount has not declined because last year it acquired the Manchester office of now-defunct firm Halliwells.
Peter Hasson
For the 2010-11 financial year the firm posted a 17 per cent rise in turnover, up to £94.5m from £80.8m in 2009-10 (16 May 2011).
Clydes, meanwhile, broke through the £200m turnover barrier for 2010-11, posting revenues of £212m up from £192m a year earlier (23 May 2011).
There is some disparity between the two firms’ profitability figures, with BLG predicting an average profit per equity partner (PEP) figure of around £300,000 for th 2010-11 year while Clydes’ PEP for 2009-10 was £605,000.
Any merger would send shockwaves through the insurance legal market, leaving firms such as Kennedys, which posted revenues of £88.2m 2009-10, and Holman Fenwick Willan, with revenues of £112.5m in 2010-11, in the merged entity’s wake.
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Readers' comments (27)
Jonathan Lea | 3-Jun-2011 2:10 pm
Given that when I was at Clydes every other litigious matter seemed to have BLG on the other side, surely this merger will create a lot of conflicts?
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Anonymous | 3-Jun-2011 2:10 pm
Merger or acquisition, this is like Waitrose buying Lidl. Lets just wait for the next team to walk out and then we'll know what the firms really make of this mess.
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Anonymous | 3-Jun-2011 2:24 pm
Surely it's more like Aldi buying Lidl, no?
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Anonymous | 3-Jun-2011 2:28 pm
Is that why the aviation team walked out?
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Marx | 3-Jun-2011 2:34 pm
Does this mean Jabba the Cut is going to get the cut?
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Anonymous | 3-Jun-2011 2:38 pm
Both firms are increasingly sub-scale. A merger would provide far greater resources for the combined entity to compete and invest, a stronger platform for overseas expansion and/or mergers, and some cost-cutting opportunities.
From a strategic perspective a merger makes good sense.
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Knockers | 3-Jun-2011 2:38 pm
I'm no great supporter of either firm, but saying things like 'X is like Aldi' just makes you look daft. Do you have any idea what a £300m revenue law firm looks like compared to most of the world's legal market?
Both firms are top 40 City firms - and if that isn't a sign of quality then what is? What do you want? Slaughters to merge with Wachtell? - would that be good enough for you? Get a life.
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cristo | 3-Jun-2011 2:46 pm
Jabba is probably driving it. This will decimate the insurance competition - how can they possibly compete with this Beast?
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Nigel Tufnell | 3-Jun-2011 3:05 pm
BLG have taken a lot of flack but this is bold and potentially game-changing for EC3 firms, though both sides will have to make some difficult decisions as the overlaps are substantial. How are Holmans, Kennedys and RPC going to respond to this?
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One-eyed panda | 3-Jun-2011 3:46 pm
Agree that it's a bold move. Let's hope for BLG's sake this comes off and conflicts don't kill it, or they're dead in the water and Jabbari will walk away with just a p45. Also, do we know if the BLG partners definitely vote for this?
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