Project Minories

Law firm

Controlled wind-down of a Midlands legal firm in crisis. Performance had been severely affected by sector reforms and economic pressures resulting in significant losses, insufficient cash and inadequate financial resource. The cash position was quickly stabilised, and the forward position monitored, while all viable options were fully explored.

Summary

  • Legal firm (non LLP); principally consumer services
  • 17 Partners; 200 staff
  • based in a number of locations across the Midlands
  • sector reforms and economy impacted performance
  • generating losses; running out of cash
  • management and governance required more strength
  • 3 different lenders; challenging dynamic

Challenges

  • stabilizing cash
  • keeping business running
  • retaining engagement of key partners
  • personal agendas; huge distraction of risk of personal liability
  • managing financial stakeholders, and their agendas
  • limited options
  • exploring sale / investor / merger options
  • ensuring effective engagement with the SRA

How we helped

  • stabilized cash and tightly monitored forward position
  • secured a time to pay arrangement with HMRC
  • effective dialogue with a challenging and diverse Partner group
  • managed stakeholders individually and collectively
  • prepared anlaysis of options
  • engagement around a contingency plan
  • explored sale / investor / merger options
  • lead engagement with the SRA
  • gave visibility and transparency of the situation and options available

 

Results

  • a sale or merger could not be achieved
  • there was a controlled wind down process
  • avoided an uncontrolled disaster for clients, staff, Partners
  • Practice continued for longer than would otherwise have been possible
  • enabled financial stakeholders to manage their positions
  • enabled Partners to take account of their individual circumstances
  • allowed restructuring and sale options to be fully explored
  • enabled SRA to engage effectively with the Practice

Benefits at a glance

  • cash stabilization and effective stakeholder engagement bought time to properly assess the situation
  • this enabled all viable restructuring / sale options to be considered
  • once clear there was no future, a managed and controlled exit from the complex scenario ensued
  • clients interests protected
  • Partners had time to understand implications
  • financial stakeholders supported throughout

Thanks to guests from the Midlands turnaround & restructuring community for lively debate at IFT’s Corporate Partn… https://t.co/Oa1bEfqswq