Thu, 19 May 2022 | BUSINESS SALE
Legal services company Knights has acquired Portsmouth-headquartered independent law firm Coffin Mew in an £11.5 million deal that “significantly” expands the company’s presence in the South East. In addition to its Portsmouth base, Coffin Mew also has offices in Brighton, Southampton and Newbury.
The acquisition represents a continuation of Knights’ strategy to help drive organic growth via strategic, high-quality acquisitions of companies that provide both a good cultural fit, as well as entry into newer markets.
Coffin Mew, which has been operating in the South East for around 130 years, provides Knights with a greater overall presence in the region, as well as entry into several new locations in the area. In addition, the company brings with it 102 new fee earners.
The £11.5 million price represents a multiple of slightly over 4.1x Coffin Mew’s operating profit of £2.76 million in the year ending March 31 2021, generated on turnover of £10.9 million. At the time, the company’s net assets were valued at close to £2.7 million.
The terms of the acquisition see Coffin Mew acquired from its 12 existing equity partners, with the acquisition occurring on a debt-free cash-free basis. The deal comprises a £6.5 million initial consideration, £5.5 million of which is in cash and £1 million new ordinary shares in Knights.
The remaining £5 million deferred consideration will be paid as two £2 million instalments on the first and second anniversaries of the deal’s completion (expected to occur on July 8 2022), followed by a £1 million payment on the third anniversary.
Commenting on the deal, Knights CEO David Beech said: "The acquisition allows us to significantly expand our presence in the South East, by entering a number of key new locations, as we continue to make good progress in achieving our ambition to become the leading legal and professional service business outside of London."
Coffin Mew Partner Miles Brown added that: “[Coffin Mew] are looking forward to benefitting from the group's scale, which will allow us to more fully meet the strong demand, and need for broader technical skills we are seeing from our clients, while greater central resource and support will better enable us to fulfil our growth potential, as part of a larger group."
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