INSURANCE specialist Parabis has become the first private equity-backed firm to take advantage of the so-called Tesco Law reforms, after winning a licence to use the Alternative Business Structure (ABS) yesterday.
Parabis is the 20th company to be granted an ABS licence since the law market was liberalised last year.
The company hopes to expand following the conversion. It already offers insurance law advice as well as non-legal services such as health and safety insurance, risk management and outsourced claims handling.
In February, Duke Street agreed to acquire a majority stake in Parabis, in a deal that valued the services firm at between £150m and £200m.
Duke Street said yesterday it hopes Parabis will be at the forefront of consolidation within the legal services industry.
Parabis chief executive Tim Oliver added: “While at times we have felt frustrated at the time it has taken to secure our licence, we are very pleased with the robustness of the application process.
“We are very excited by the possibilities now open to us.... It has been important to secure ABS status so that we can compete effectively and retain our innovative edge.”
The Legal Services Act came into force in October 2011, after encountering months of delays in parliament.
The act, dubbed the Big Bang of the legal sector, aims to open up English law to non-traditional players.
The ABS allows law firms to seek outside investment, and to be owned by non-lawyers through investments or even public offerings.