Shares plunge in listed law firm Gordon Dadds following £10m placing
Shares in listed law firm Gordon Dadds plunged nearly 25 per cent today after it announced a £10m share placing.
The firm said the accelerated bookbuild was successful and oversubscribed, conditional on the passing of a placing resolution at a general meeting and the admission of the shares to the Aim market.
The firm’s share price fell nearly 25 per cent to 142.5p from yesterday's close of 189p.
The minimum placing price represents a discount of nearly 26 per cent from yesterday's closing price. The new shares will represent nearly 25 per cent of the firm's issued ordinary share capital following admission.
Gordon Dadds recently bought the UK business of shipping law firm Ince & Co out of administration in a £27m deal.
The international offices of Ince joined Gordon Dadds in a network arrangement with Gordon Dadds hoping to absorb them over time.
Speaking to Morning Wire the firm’s chief executive Adrian Biles said the placing was intended to give Gordon Dadds the firepower to make further acquisitions.
“We used our cash and we now want to reload,” he said.
“The thing which differentiates us is the fact we have cash on the balance sheet…We have new bluechip investors that give us a share register that is second to none in the City and that means that if an acquisition comes along we have got the cash,” he said.
Biles said the firm hoped to be able to build out the firm further in the coming months.
“We are talking to firms in multiple jurisdictions and hope to be able to announce some transactions before the end of the first quarter,” he said.
In its statement to the stock exchange it said it was looking at acquisition targets in Malta, Gibraltar, South Africa, China, Hong Kong and Bermuda.
He also said the firm expected to add some of the international offices of Ince to Gordon Dadds, with conditional deals with its bases in Hong Kong, Singapore, Dubai, Greece and Germany.
“We expect to be able to close the already agreed acquisitions overseas apart from France and Monaco where ongoing discussions are taking place,” he said.
The firm raised £20m when it listed in August 2007, with £14m earmarked for acquisitions.
Gordon Dadds said it has invested that money in five acquisitions and taken on £6m of debt finance to do deals.