Listed law firm to be acquired

Allegro Funds is to acquire 100% of listed law firm Slater & Gordon (ASX: SGH) for $77.6 million.

The company has signed a bid implementation scheme with the private equity firm.

Slater & Gordon’s board are to recommend shareholders to accept Allegro’s 55 cents a share offer subject to usual conditions, the firm announced on 24 February.

Slater & Gordon chair James MacKenzie said the company’s shares were highly illiquid and the all-cash offer would provide certainty of value for shareholders. The Allegro investment would also provide an opportunity to simplify the company’s capital structure which is currently dominated by offshore hedge funds.

Allegro has made private offers to the holders of Slater & Gordon’s super senior debt facility.

Founding partner Adrian Loader said Allegro was excited to link up with the Slater & Gordon team and assist in continuing to grow the company which, he said, “has a long and proud history in the Australian consumer law sector”. Loader said Allegro had significant experience in investing in purpose-led professional services organisations similar to Slater & Gordon and looked forward to working with the firm’s strong team of lawyers, whom it was keen to retain, support and incentivise.

Slater & Gordon said Allegro had indicated that it regarded governance and management continuity as important. The firm anticipated that under Allegro chief executive John Somerville would retain his position and three current independent directors would remain on the board.

Allegro’s offer is conditional on the firm gaining acceptance for more than 50% of Slater & Gordon’s shares.

Allegro will invest its stake in Slater & Gordon from its $750 million Allegro Fund IV.

Slater & Gordon is being advised by Flagstaff Partners and law firm MinterEllison.