It could be said that the old Australian regime has collapsed. At the end of June 2017, Slater and Gordon Lawyers UK or S&G UK released their annual reports, which reported decreased revenue to £230.5 million (26.9%) and a total loss of up to £52m. The most considerable losses of the company were reported in 2016 with more than £400 million when the acquisition of Quindell backfired. As a result, the share price of the former quickly plummeted. The new regime was announced at Slater Gordon after this £52m annual loss.
After the huge losses, its Australian owners decided to hand over the firm control to a group of hedge funds that is led by the Anchorage Capital. This allowed for secured debts of approximately £386m to be written off. Since the last summer, its offices in Fareham and Sheffield have been closed as a part of the consolidation measure, but the new owner has pledged to invest £30m on broadening services and new technology over the next 3 years. This resulted in a historic strategy and shareholders were in the process of planning a ‘clean firm’ that can make a profit in the next year.
Every employee and manager of Slater Gordon should have a positive view of the situation. It is a really important change that can transform the whole business. They are now a new company that has more ambitious business objectives and moves forward with the different strategy. At the lowest point in 2016, the company had lost more than £400m in just one year when the acquisition of the Quindell PLC spectacularly backfired, and the Australian owner’s share price significantly decreased, which wiped out most of the company’s value.
The consolidation process had started by 2017, with the wage bill reduced in one year from £135m a year to £110m. The headcount of Slater Gordon also came down by July 2017 by nearly 500 to 3276. Over the next months, that figure will be reduced further. Many employees have reported that they weren’t kept up-to-date with the latest development in the business under the old regime.
But over the past few months, things have changed, with managers starting on a series of programs to explain what adjustments and changes are going to take place. Slater and Gordon, which gets a considerable amount of its income and revenue from personal injury projects, consider the reforms in their company and the market as a golden opportunity to grab, with the solicitors Shrewsbury landscape and across the UK in relative flux.
There will be many technological changes and improvements in the business in the next 1 or 2 years. That’s why they need to reassure their staff about their strategy and mission in the long run. The company has a really good starting position in a quite fragmented market with many opportunities to grow and make profits.