NATIONAL business law firm DWF last night confirmed that it planned to acquire Cobbetts, as part of its strategic growth plans.
The announcement came a day after Cobbetts, which has around 190 staff in Leeds, confirmed that it had filed a notice to appoint administrators and put itself up for sale.
In a statement, DWF, which has an office in Leeds, said last night: “Like many businesses, Cobbetts had built an infrastructure reflecting the buoyant economy of the mid 2000s and had put in place plans to reduce costs.
“However, poorer than expected trading in November and December last year caused the firm to review its financial position and subsequently obtain an interim statutory moratorium to enable a sale of the business and its assets.
“It is believed by the members of both firms that a sale to DWF represents a solution that would secure the most favourable outcome for its creditors, members, people and clients.
“For clients, this move would facilitate the continuation of service delivery and business as usual, with the same service terms they have enjoyed at Cobbetts, thereby ensuring a smooth transition for them and their business interests.”
Managing partner and chief executive of DWF, Andrew Leaitherland, said last night: “DWF’s plans to grow, in a strategic, targeted way have been clearly set out and this move supports that goal.
“I am confident that the merging of the two firms would bring genuine benefits to both and, importantly, the joint client base.
“There are many synergies between the two firms in terms of the sectors in which we operate and this collaboration will further strengthen our existing business. I am very much looking forward to welcoming the new team to DWF.”
The process of transferring people across to DWF will start in the next week, if the deal is approved.
Mr Leaitherland continued: “The legal industry as a whole has faced significant challenges.
“We will do all we can to make the integration as smooth as possible, however, as you’d expect in a move of this size, there are some areas of overlap and we may have to displace people or find them alternative roles.
“We will work hard to support all those involved.”
Exactly one year ago, DWF and Manchester-based Cobbetts revealed that they had ended merger talks because of the uncertain market conditions.
DWF has grown rapidly through mergers and lateral hires in recent years. In five years, DWF’s Leeds operation has grown from 55 staff to just under 230.
DWF recently merged with the professional indemnity practice Fishburns in the latest stage of its plan to become a top 20 player.
The deal bolstered DWF’s presence in London and expands its geographical coverage to include Bristol and Dublin.
DWF, which has an office at Bridgewater Place in Leeds, had a turnover of £102m last year.
DWF has 1,800 people based in Birmingham, Coventry, Edinburgh, Glasgow, Leeds, Liverpool, London, Manchester, Newcastle, Preston and Teesside and has an international reach through its relationships with law firms around the globe.
In recent years a number of law firms have sought buyers, or collapsed due to financial pressures caused by the recession.
According to David Wilson, senior partner at Begbies Traynor in Yorkshire and the North East, businesses with a heavy reliance on property have been particularly hard hit.
One of the most high profile casualties was Halliwells, which had offices in Manchester, Sheffield, Liverpool and London. Halliwells entered administration in July 2010 with debts of almost £32m.