Listed law firm Knights Group has acquired specialist housing, regeneration and commercial real estate law firm Croftons.
Knights said: “This acquisition builds on the company’s presence in Manchester, in line with the group’s strategy to accelerate its organic growth through carefully targeted acquisitions which are a strong cultural fit and strengthen existing offices, add new geographies or complementary business services.”
Established in the 1840s, Croftons advises more than 50 housing associations, “which typically provide a stable and consistent stream of case work through the economic cycle”, Knights said. The acquisition sees 33 fee earners joining Knights.
In its unaudited accounts for the year ending 31 March 2019, Croftons achieved revenue of circa £2.8m with a corporatised PBT margin of circa 15%.
Under the terms of the acquisition, Knights will acquire the corporate owners of Croftons from their three existing shareholders on a debt free, cash free basis for a total consideration of up to £2.8m.
This comprises of £1.4m in cash which is payable on completion and the issue of £0.7m in 163,086 new ordinary shares in Knights to the sellers, along with deferred cash consideration of up to £0.7m, to be paid in equal instalments on the first and second anniversary of completion, subject to certain conditions being met.
David Beech, CEO of Knights, said: "The Croftons team is well regarded in the housing association sector, which typically brings recurring revenues from this highly defensive segment of the market. We previously set out a strong intent to expand in Manchester with our move to larger, modern premises in 2019 and look forward to welcoming Croftons to our growing team there.”
Simon Leighton, Managing Partner of Croftons, said: “We are excited to join Knights, a firm we see as a good home for Croftons in terms of culture and ambition. We bring particular expertise in the housing association sector and look forward to continuing to achieve our growth plans as part of a well-established and ambitious team.”