TIDMKGH
RNS Number : 9835X
Knights Group Holdings PLC
02 May 2023
2 May 2023
Knights Group Holdings plc
("Knights", the "Company" or the "Group")
Acquisitions of St James Law Limited and Baines Wilson LLP
Strengthens Knights' presence in the North, providing entry into
Newcastle and Carlisle
Knights today announces that it has agreed to acquire St James
Law Limited (trading as St James' Square), a Newcastle-based
commercial law firm, and Baines Wilson LLP (Baines Wilson) an
independent law firm headquartered in Carlisle.
St James' Square
St James' Square is an independent full service commercial law
firm located in Newcastle, the financial centre of the North East
of England. The acquisition brings 23 fee earners to Knights and
provides entry into Newcastle, an important strategic location
which complements the Group's existing Teesside presence. The
business also currently includes a debt recovery business
(accounting for just under 20% of company revenues); strategic
options for this business, which is considered non-core to Knights,
will be reviewed following completion.
In its unaudited accounts for the year ended 31 December 2022,
St James' Square reported revenue of GBP2.4m and a corporatised PBT
margin, excluding the debt recovery business, of circa 5%.
Accounting for a typical 20% revenue churn post-acquisition, the
Board expects the acquisition to be immediately earnings enhancing,
with St James' Square expected to contribute an adjusted PBT margin
of circa 15% post synergy savings.
Under the terms of the acquisition, Knights will acquire St
James' Square from its four existing owner-managers, two employees
and an investor on a debt free, cash free basis, for a total
consideration of GBP1.75m. This comprises an initial cash
consideration of GBP0.5m, with deferred payments of GBP1.25m to be
paid as GBP0.7m on the first and GBP0.55m on the second anniversary
following completion in each case subject to the satisfaction of
certain conditions. Completion is expected to take place on 16 June
2023.
Baines Wilson
Baines Wilson, which was founded in 1999, has grown into one of
the leading commercial law firms in the North West of England.
Operating primarily out of Carlisle, with an additional smaller
office in Lancaster, Baines Wilson is a specialist business law
firm, offering Corporate, Real Estate, Dispute Resolution and
Employment services. The acquisition provides entry into Carlisle,
the financial and business focal point of Cumbria, and brings 27
fee earners to Knights.
In its unaudited accounts for the year ended 31 March 2023,
Baines Wilson reported revenue of GBP3.2m and a corporatised PBT
margin of circa 20%. Accounting for a typical 20% revenue churn
post-acquisition, the Board expects the acquisition to be
immediately earnings enhancing, with Baines Wilson expected to
contribute an adjusted PBT margin of circa 25% post synergy
savings.
Under the terms of the acquisition, Knights will acquire Baines
Wilson from its five existing equity partners on a debt free, cash
free basis, for a total consideration of GBP3.37m. This comprises
an initial cash consideration of GBP2.35m, with deferred cash
consideration of GBP1.02m to be paid as GBP0.34m on the first,
second and third anniversaries following completion in each case
subject to the satisfaction of certain conditions. Completion is
expected to take place on 2 June 2023.
The cash consideration for both acquisitions will be satisfied
from Knights' existing bank facilities.
Both acquisitions align with Knights' strategy to bolster its
future organic growth through selective , considered acquisitions.
They provide access to new important regional markets and platforms
for further growth through the recruitment of local talent and
potential bolt-on acquisitions. Post completion, Knights will have
five offices in the North West and two offices in the North East of
England, which alongside Knights' three existing offices in
Yorkshire, strengthen the Group's presence and brand reputation
across the North.
Commenting on the acquisitions, David Beech, CEO of Knights,
said:
"We are delighted to announce the acquisitions of St James'
Square and Baines Wilson, which provide us with entry into two
important strategic growth markets in the North of England and
complements our existing presence in the region. Strong cultural
fit with Knights is a key criteria in our M&A strategy, and
both firms are well aligned with the St James' Square senior team
already very well known to our Teesside team. In addition, both
operate in key centres in their respective regions, providing
significant organic growth opportunities through the recruitment of
high-quality talent."
Paul Monaghan, Managing Partner, St James' Square commented:
"We are excited to be joining Knights, whose reputation and
reach will allow us to enhance our client service offering and
ability to recruit from Newcastle's deep pool of talent. We already
have strong relationships with the well-respected Knights team in
Teesside and look forward to working together more closely to
capitalise on the significant market opportunity in the North East
of England."
Sean Logue, Partner/Head of Partnership, Baine Wilson
commented:
"Having grown to become one of the leading firms in the North of
England, we are thrilled to be joining Knights, a firm which
champions client service and shares our vision. As part of a larger
group, offering a wider range of services and scale, we are
confident that we will be able to accelerate our growth in
Carlisle, Lancaster and the surrounding region."
- ENDS -
Enquiries
Knights
David Beech, CEO Via MHP Communications
Numis (Nomad and Broker)
Stuart Skinner, Kevin Cruickshank 020 7260 1000
MHP Group (Media enquiries)
Katie Hunt, Eleni Menikou, Rob 020 3128 814 7
Collett- Creedy 07736 464749
knights@mhpg roup .com
Notes to Editors
Knights is a fast-growing, legal and professional services
business, ranked within the UK's top 50 largest law firms by
revenue. Knights was one of the first law firms in the UK to move
from the traditional partnership model to a corporate structure in
2012 and has since grown rapidly. Knights has specialists in all
key areas of corporate and commercial law so that it can offer
end-to-end support to businesses of all sizes and in all sectors.
It is focussed on key UK markets outside London and currently
operates from 23 offices located in Birmingham, Brighton, Bristol,
Cheltenham, Chester, Crawley, Exeter, Leeds, Leicester, Lincoln,
Maidstone, Manchester, Newbury, Nottingham, Oxford, Portsmouth,
Sheffield, Southampton, Stoke, Teesside, Weybridge, Wilmslow and
York.
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END
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