Cobbetts plans to jettison up to 20 partners once a consultation on the firm’s future has been concluded.
The 20 will be a mixture of full-equity, fixed-share and salaried partners. The changes are an attempt by Cobbetts to ramp up profitability from last year’s below-market-average profit per equity partner (PEP) of £190,000.
Last month, Cobbetts managing partner Michael Shaw reported a 7 per cent rise in turnover for 2005-06 to £53.7m, a figure that, it subsequently emerged, fell more than £4m short of its target of £58m. PEP was predicted to remain static at of £190,000 for this year.
Cobbetts partner and board member Tony Fitzmaurice confirmed the consultation process would lead to up to 20 partners leaving the firm, but maintained there would be no redundancies among assistants or support staff.
Revenue per lawyer has sunk to just £120,000, but Fitzmaurice said PEP was still “forecast” to be £190,000.
He added: “The firm was in credit at year-end.”
Cobbetts carried out a series of mergers in 2004 and 2005, dramatically increasing the firm’s size. However, sources close to the firm report that morale, particularly in Birmingham where the firm took over local outfit Lee Crowder, is low.
Recently, office managing partner Stephen Gilmore announced he was quitting Cobbetts to set up a consultancy, although he has retained a consultant role with the firm.
The firm also has invested heavily in new premises during the past year.