BLG and Clydes get partner backing for proposed tie-up
Barlow Lyde & Gilbert (BLG) and Clyde & Co have voted to proceed with their merger plans, the firms have announced jointly.
Michael Payton
Clydes is expected to inherit 60 out of a possible 90 BLG partners if the deal goes ahead. According to sources close to the firm, about half of those partners, most of whom are in the equity at BLG, will become salaried partners in the enlarged firm.
This is because there is some disparity between the two firms’ profitability figures, with BLG predicting an average profit per equity partner (PEP) figure of around £310,000 for the 2010-11 year while Clydes’ PEP stood at £605,000.
Clydes senior partner Michael Payton said of the deal: “There’s huge enthusiasm and we look forward to the finalisation of the agreement and proceeding towards integration.”
BLG senior partner Simon Konsta added: “The result of the votes is an exciting and very positive step forward and reflects our belief in the potential of a combination between our two firms.
Simon Konsta
“We look forward to working with Clyde & Co to establish a final agreement that meets both firms’ strategies.”
Clydes’ partners voted on the merger last night. The firm needed more than 80 per cent of the partners to vote in favour of the deal for the merger to go ahead.
At BLG, where partners voted today, the firm needed more than 75 per cent of the partnership to back the deal for plans to proceed. According to sources close to the firm, BLG has agreed lock-in terms with partners guaranteeing their commitment to the firm for the next 18 months.
Any merger will go ahead in November.
As revealed by The Lawyer on Monday, Clydes has drawn up a shopping list of the BLG partners it wants as part of the deal (23 July 2011).
Readers' comments (9)
Anonymous | 29-Jul-2011 5:41 pm
What strike me as odd is why BLG felt it had to do this. There was plenty going for the firm and it did have some strong practices, it should have attempted to reboot those instead of selling out to the highest bidder.
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Anonymous | 29-Jul-2011 6:20 pm
10% of BLG partners ejected now, 20% left voluntarily last year, and no doubt a few will conclude Clydes is not for them anyway. The one way lock-in says it all. Sad end to what was really quite a good firm a few years back
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James Watthey | 30-Jul-2011 6:21 pm
Official at last. Not the best kept secret in the City this year!
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Anonymous | 31-Jul-2011 10:35 am
Sad end? All but a handful of partners housed in a focused, profitable £300m plus turnover firm which will dominate international insurance and many other areas for years to come, not to mention one of the biggest litigation firms in the world. The real 'saddos' look like the partners who jumped ship for dead end commercial firms. How BLG was able to pull this off amazes me.
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The Notorious BLG | 1-Aug-2011 9:50 am
@Anonymous 5.41pm: clearly you know little about BLG, otherwise you'd know of the impossibility of a "reboot" for a failed firm.
This is the only life raft available for BLG's remaining partners, and they've taken it: pity it only has room for 60.
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Anonymous | 1-Aug-2011 11:27 am
More than anything else, this seems to be a complete u-turn on the strategy to expand into the regions, now replaced by a "merger" in order to break into high end litigation and take advantage of Clyde's international reach: as usual pity those "let go of" in the fallout.
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Anonymous | 1-Aug-2011 1:10 pm
Having followed this story, it seems the main draw for Clyde is BLG's top flight professional indemnity group. It will be interesting to see which other remnants of BLG (including the name) last for long.
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The Notorious BLG | 1-Aug-2011 1:39 pm
@Anonymous 10:35 am: BLG haven't "pulled off" anything. They've been asset stripped and the carcass dumped by the roadside. Hardly an achievement.
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Anonymous | 2-Aug-2011 11:45 am
Be interesting to see how many partners/staff actually cross over to Clydes on 01/11/11 and more interesting to see who is still there once the lock-in expires.
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