300 jobs under threat at Fairpoint Group

Up to 300 jobs at AIM-listed consumer professional services company Fairpoint Group and its legal subsidiary Simpson Millar are under threat.

Some 200 staff at the company’s headquarters at Adlington in Lancashire have been told they are at risk of redundancy, but fears the site may close altogether in June are unfounded, a source close to Fairpoint said.

The affected staff work across the company’s Debt Free Direct, Writefully Yours and Clearstart Partnership brands.

About 100 staff at subsidiary law firm Simpson Millar at offices in Old Trafford, Manchester and Leeds are also at risk. Its Newcastle site could also close.

The news has shocked staff at Fairpoint, which announced in November the success of Simpson Millar – acquired two years previously – had triggered a further £3m payment for the business in addition to the £7m originally paid.

In September, Fairpoint announced flatlining profits at £4m but a 24% growth in revenue to £28.2m for the six months to June 30, 2016.

An employee who did not wish to be identified told TheBusinessDesk: “We are devastated. We thought the company was doing really well.”

Earlier this month City solicitor David Harrel became temporary executive chairman of after its chief executive Chris Moat stepped down.

Harrel, one-time senior partner of what was then SJ Berwin and still a consultant at its successor, King & Wood Mallesons, has been Fairpoint’s non-executive chairman but will work in the business alongside chief financial officer David Broadbent while the search for a new chief executive goes on.

In December, Fairpoint saw its share price crash after issuing a profits warning about its legal arm and said future dividends were likely to be suspended.

A spokesperson from Fairpoint Group said: “We can confirm that we have communicated with staff that the group has entered a consultation process to agree certain structural changes. 

“This process reflects the group’s previous announcements that its debt management business will be closed in early 2017, that its core strategic focus going forward would be on its legal services business, and also reflects the group’s plans to mitigate the impact of the recently announced reduction in expected trading performance.

“However, until we have undertaken that process and agreed the structural changes we are unable to provide more specific details.”