RNS Number : 6035O
Knights Group Holdings PLC
31 January 2019

31 January 2019

Knights Group Holdings plc

("Knights", the "Company" or the "Group")

Acquisition of BrookStreet des Roches LLP ("BrookStreet")

Knights adds highly regarded law firm to its existing Oxford office

Knights, one of the UK's fastest growing legal and professional services businesses, today announces its fourth acquisition since listing with the exchange of contracts to acquire BrookStreet, one of the leading independent law firms in Oxfordshire.

Acquisition rationale and background

The acquisition will be a transformational addition to the Knights Oxford office, in line with the Group's strategy to accelerate organic growth through carefully targeted acquisitions which enhance the core business strengths and are considered a strong cultural fit. Knights has a proven method of selecting, executing and integrating acquisitions of quality businesses which complement its strategy of building a nationwide, full service legal and professional services business focused on attractive markets outside of London.  


Founded in 1994, BrookStreet has grown to become one of the leading commercial law firms in the region with a particularly strong reputation nationally for its real estate practice, which works with high-quality blue chip clients. Its 45 fee earners will be integrated into Knights' existing Oxford office, taking the total fee earners in Oxford to over 140. The total number of fee earners across Knights' eight offices will be in excess of 530.  

For the financial year ended 31 March 2018, BrookStreet delivered revenue of £7.2m and profits distributable to members (i.e. pre-partner drawings) of £2.6m.  Once fully integrated, as a result of maximising synergy savings by moving BrookStreet into Knights' existing office, the Company anticipates that the acquisition will contribute an EBITDA margin in excess of 30%.


Terms of the acquisition

Under the terms of the acquisition, Knights will purchase BrookStreet from its existing equity partners, led by Rosie Gibb ("Sellers") for a total of up to £10m, comprising consideration of £7.5m which is payable on completion and made up of £5m in cash (including the repayment of approximately £2.2m debt) and the issue of £2.5m in consideration shares to the Sellers.  Deferred consideration of up to £2.5m in cash comprises £1.6m which will be payable on 1 April 2020, £0.45m payable on 1 April 2021 and £0.45m payable on 1 April 2022, subject to the Sellers remaining in employment with Knights on those dates.  The cash consideration will be satisfied from Knights' existing facilities. Completion is expected to take place on 1 April 2019.


Application will be made to the London Stock Exchange for the admission of 1,065,850 new ordinary shares to trading on AIM. Admission of the new shares is expected to take place at 8.00am on 1 April 2019 following completion. The Company's total issued share capital following admission will consist of 73,325,419 ordinary shares of 0.2 pence each with one voting right per share. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.


Commenting on the acquisition, David Beech, CEO of Knights, said:

"We are delighted to build on our strong momentum following the three acquisitions we have made since listing in June 2018, as we continue to enhance our geographical presence and expertise through the selective acquisition of high calibre firms.


"With the acquisition of BrookStreet, we add to that momentum by welcoming one of the most highly regarded teams outside London, with a particular strength in real estate. Its combination with our existing team will position us as one of the leading legal and professional services firms in the region - a transformational step for Oxford."


Rosie Gibb of BrookStreet, added: 

"We are very excited to join Knights, given its strong reputation for developing leaders in the provision of high-quality legal services in key markets outside London.  We bring particular expertise in the real estate sector to the already strong team in Oxford and we look forward to being part of a larger Group with the culture, robust financial position and ambition to support our continued growth."


Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.




David Beech, CEO

via MHP Communications

Numis (Nominated Adviser and Broker)

Stuart Skinner, Kevin Cruickshank, Michael Burke

+44 20 7260 1000

MHP Communications (Media enquiries)

Andrew Jaques, Katie Hunt, Kelsey Traynor

+44 20 3128 8100


Notes to Editors

Knights is a fast-growing, legal and professional services business, ranked within the UK top 100 largest law firms by revenue. Knights was one of the first law firms in the UK to move from the traditional partnership model to a corporate structure in 2012 and has since grown rapidly. Knights has specialists in all of the key areas of corporate and commercial law so that it can offer end-to-end support to businesses of all sizes and in all sectors. The Company's focus is on the UK's markets outside of London, offering 'big city' quality expertise from a regional cost base. Currently, Knights operates from eight offices located in Cheltenham, Chester, Derby, Newcastle-Under-Lyme, Manchester, Wilmslow, Oxford and Leicester.


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