Today’s big development is the purchase of Russell Jones & Walker by Australian firm Slater & Gordon, the first law firm in the world to float. The deal is subject to SRA ABS approval, and to some caveats. Details are here and here.
The first point to note is that there are law firms that are worth others buying. RJ&W however has in addition their heavily advertised Claims Direct brand. This shows the advantage of an early businesslike approach to running a firm.
Secondly, RJ&W senior management will receive S&G shares as part of the purchase price. When they move on or retire, they can simply sell the shares, or hold them as an investment. The firm will not have to find cash to pay them out, as would be the case with a traditional partner.
The third interesting point is that this is the purchase of one law firm by another, rather than by a new player in the market. It remains to be seen whether say the banks will take the same approach (and who will be left to buy).
So there is a lot to be said for building a law firm worth buying, even if you decide not to sell!