Another week, another takeover for Halliwells. This time the North West’s most muscular outfit has done a deal in its own back yard in Manchester, with the absorption of insurance boutique James Chapman.
Last November, Halliwells managing partner Ian Austin told The Lawyer that he was aiming to hit £70m revenues in 2007. Chapmans’ £10m-odd-turnover business will be mighty convenient for him.
There have been rumours circulating Manchester for months that Chapmans was on the auction block. It had been facing a squeeze and had already lost out in Axa’s most recent round of panel cuts. Sources close to the firm claim it had had a good year, with average profit per partner projected to reach £350,000, but in reality independence was not a long-term option.
Four Chapmans partners are going into the tightly-held Halliwells equity, with three going into the fixed-share layer. The rest will be salaried. Austin has a deserved reputation for decisiveness; executing this deal took six weeks.
It certainly gives a fillip to Halliwells’ insurance division: it has a good industrial disease practice, but coverage has been patchy. The Chapmans team delivers a broad spread of defendant work, including professional indemnity. The brand heritage of that practice is such that Halliwells is retaining the Chapmans name for insurance work – an unusual move potentially fraught with integration difficulties.
Austin has a pronounced appetite for expansion. In the last year he has pulled off mass lateral hiring from DLA Piper, the takeover of Cuff Roberts in Liverpool and a deal with Blacks in Leeds, all of which leaves Halliwells looking pretty swollen in the North.
But what’s he going to do about London? Halliwells has 28 partners based in London out of a total of 122 nationwide. What’s more, the political weight is based firmly in Manchester after Austin got rid of the regional fiefdoms which threatened to fracture the firm’s culture.
Cobbetts might like to spin the line that it can be a credible national force without a London office, but Austin cannot seriously agree. Just look at Pinsents: it took years for it to realise that building London was paramount, and in that time it lost serious market share against DLA Piper and Addleshaws. Halliwells has been transformed under Austin’s leadership, but it’s starting to look rather unbalanced. Regional pride can only go so far.