Law Firms' IPOs -- Coming Soon to the U.K.
Most large law firms have handled some kind of IPO work. But now, at least in the United Kingdom, a law firm might technically become the subject of an IPO, as Bruce MacEwen reports in this post:
Thanks to the Clementi Commission reforms, which will take effect next year, public investment in law firms will be legal; indeed, law firms could hypothetically take themselves through an IPO. And it's not just public investors, but partners bearing money of all types: Firms could join forces with investment advisors, management consultants, commercial real estate brokers, wealth management specialists and private bankers, etc., etc.
Already, law firms are taking calls from the large investment banks, exploring the possibility of external investment. And MacEwen predicts that even those firms that aren't "totally convinced" now will become "terribly flattered" and entirely open to proposals by next year.
I'm not familiar with the U.K.'s professional ethics rules, but here in the United States, I have difficulty figuring out how firms can accept outside investors without compromising their independent judgment or running into conflicts of interest. Not that I think that ethics rules will pose any impediment to outside investment, if it grows in popularity. Rather, we'll see a move from within large firms to change ethics rules to accommodate the type of investment activity taking place overseas. After all, why should the ethics rules stand in the way of making millions of dollars?
Posted by Carolyn Elefant on January 26, 2007 at 05:14 PM | Permalink
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