Categories:UK

Herbies tops charts in The Lawyer's first-ever ranking of net debt

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  • Does Herbies get a special prize for being the most indebted law firm? Special visit from the bank manager, perhaps?

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  • This is meaningless: we don't have an equity capital contribution, instead the firm borrows on behalf of all partners and gets a (hopefully) better rate, we pay a per-equity-partner share of the interest each year and give a guarantee over our share of the debt. Accordingly, our debt is largely determined by the number of equity partners. I am sure that many other firms do the same thing and I'm sure that the Lawyer knows that's what they do.

    I would much rather borrowing tens of millions as a group of 100+ partners than hundreds of thousands as an individual.

    This is either deliberate sensationalism or just plain stupid.

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  • The Lawyer should also consider undertaking an analysis of the level of partner capital in each firm. It would be interesting to see how much a partner of one firm has to invest for his profit share, compared with a partner at another. And how is that capital invested - genuine profit retention (i.e. cash left in the business) or borrowed funds by the particular partner, or a combination of the two? The comments by the HSF partner suggests it is bank funded all the way. Is that the case at other firms?

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  • Good to see some analysis like this, although slightly let down by the assertion that Trowers' and Pinsents' debt increased by 100% by the action of taking on debt.

    If those firms suddenly showed debt levels of £100 compared to £0 a year before, then on the same calculation, debt increased by 100%. So the percentage figure is completely meaningless.

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  • What is going on at Browne Jacobson?

    Their name keeps cropping up in these articles. Are they having an enormous overhaul or is something going awry?

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