City fund managers including Schroders Investment Management and Miton Group have backed the pioneering float of Britain’s first listed corporate law firm.
Gateley become only the second law firm in the world to list shares publicly following the introduction of new rules in 2012 allowing non-lawyers to invest in law firms.
Shares in the Birminghambased firm rose as high as 110p yesterday from their 95p listing price after the stock started trading on the alternative investment market.
The business has raised £30m by placing shares with investors, giving it a market cap of £100m.
Schroders accounts for £8m of the funds raised, while Miton has invested £5.6m. Gateley’s clients have also backed the company with about £3m.
“We looked at all of the financing options and a flotation was one of them,” chief executive Michael Ward said after the placing.
“From a branding point of view it differentiates us in the crowded mid market. We also saw that having a balance sheet and doing deals
would allow us to expand more quickly.”
Australian law firm Slater & Gordon became the first practice in the world to list shares when it floated on the Australian Stock Exchange in 2007.
Law firms have traditionally followed the tightly-knit model of a partnership structure but Gateley’s float is breaking new ground.
“There has been some reticence but some serious funds have backed us,” Ward said.
“I don’t think there’ll be a flood of firms following us. Not everybody has the right story and got themselves into the position where the market will be receptive to them.”
Gateley was founded over 200 years ago in Birmingham and currently has 81 partners who will all become salaried employees under the restructure.
Cantor Fitzgerald was the financial adviser to Gateley on the float.