Liverpool firm Silverbeck Rymer is set to become the first law firm to be acquired by a listed company after Quindell Portfolio announced it had agreed to pay almost £20m for the firm.
AIM-listed Quindell, a brand extension company that also provides consultancy, software and outsourcing services, will buy personal injury specialist Silverbeck Rymer for £19.31m, subject to the Solicitors’ Regulation Authority (SRA) approving its application to become an alternative business structure.
Silverbeck Rymer and Quindell will combine to provide “a joint outsourcing offering to the UK insurance claim market, in particular the area of personal injury”. Quindell also recently bought Mobile Doctors, a medical reporting agency. According to a statement by Quindell, Silverbeck Rymer already provides business to Quindell’s insurance outsourcing operations.
Quindell is proposing to pay £10.25m in cash for the firm, and will also issue up to 120.8m shares (valued at 7.5p per share), which will be subject to lock-in arrangements ranging from 12 to 36 months.
In a statement, Silverbeck Rymer chairman Jim Rymer said: “We see significant benefits in being part of the enlarged group. Quindell has a rapidly growing presence in the insurance space and we firmly believe in its non-conflict approach to working with insurers. Its positioning as thought leader and belief in improving margins whilst lowering costs for the industry sits well with our philosophies of working alongside insurers to help combat fraud and other areas of cost escalation, whilst being an active promoter of fairness and protector of consumer rights and championing industry change.”
Rob Terry, chairman and chief executive of Quindell, said: “Silverbeck Rymer is a robust business and performs well in its own right, however the combination of Quindell, Silverbeck Rymer and Mobile Doctors together represents a significant opportunity for us to address the issues faced by the insurance industry within one of its three key areas of claims leakage: personal injury. We look forward to continuing to work with the management at Silverbeck Rymer on their brand initiatives, and announcing in due course that we have concluded the formal agreement and obtained the necessary regulatory clearances to complete the acquisition at the earliest opportunity.”
According to a statement in the 2009-10 financial year Silverbeck Rymer reported £6m in profit before tax and the most recently available management accounts show net assets of around £8m. The firm is not an LLP.
Clearance for the deal is expected to take a number of months and the vendors have given Quindell the exclusive right to acquire Silverbeck Rymer until 31 December 2012, even in the face of higher bids.