Knights has made its largest splash to date, taking £28.6m out of its war chest to acquire two more regional firms, while also launching a £20m share placement towards funding the deals.
The listed firm has agreed to acquire Leeds-based outfit Shulmans for approximately £20.1m and south east firm ASB Law in a deal worth up to £8.5m. The respective acquisitions will see a total of 219 fee earners decamp to Knights upon completion.
Shulmans operates as a full-service firm with a strong focus on telecom masts, dilapidations and overseas investment in UK property. In its most recent financial results, Shulmans posted a 9% increase in turnover to £17.6m. Meanwhile, ASB Law posted an £11m turnover increase for 2017/18. It also has a presence in Crawley and Maidstone.
Knights hopes the acquisitions will result in a ‘high single-digit’ percentage increase for the financial year ending 30 April 2021. The ASB deal is expected to be completed next month on 17 April with Shulmans later finalised on 24 April.
In a bid to replenish its resources, Knights has also announced a placing of 4,761,905 ordinary shares to raise £20m, which will also partially fund future inorganic growth. The announcement was followed by a marginal increase in Knights’ shares to 456p this morning.
The acquisitions mark an active start to the year for the firm. Last month, Knights announced it had acquired Nottingham-based firm Fraser Brown in an £8m deal which brought over 81 fee earners. Meanwhile, the firm also agreed a new £40m revolving credit facility split equally with HSBC and Allied Irish Bank last month. Overall, Knights now counts ten acquisitions since its listing.
The recent buyouts have in part been driven by the firm’s impressive debut financial results as a listed entity, having upped revenue 51% last year to £52.7m, 15% of which was organic growth. Off the back of the results, Knights chief executive David Beech (pictured) had told Legal Business the firm would make ‘up to four acquisitions’.
The firm’s first deal after floating was a buyout of Manchester independent Turner Parkinson, which was followed up in 2018 with a buyout of Leicester-based Spearing Waite.
