Gateley directors and staff reveal plans for £10m share sale

Legal and professional services firm Gateley announced this morning that certain directors and staff plan to sell shares in the company worth around £10m.

Gateley floated on the Alternative Investment Market in 2015, becoming the first law firm to go public.

At that point 70% of the company was held by Gateley partners, who agreed five-year lock-ins which permitted them to dispose of up to 10% of their shares in any 12-month period.

In October, the firm entered into an agreement with its partners to extend the period that they are ‘locked in’ and prevented from releasing their shares.

The new arrangement will begin on 8 June 2020 following the expiry of the current lock-in arrangements, which were put in place at the time of the company’s admission to AIM.

Gateley said that, of the 81 partners who were subject to the current lock-in agreement at admission, 75 remain with the company. Of these remaining partners, 70, who, together with their respective associates, hold in aggregate 56,187,614 Ordinary Shares representing 49.4% of the total issued share capital of Gateley, entered into the new agreement.

The latest share sale comes as the company prepares for the departure of chief executive Mike Ward, who is set to stand down on April 30.

Rod Waldie, the senior partner of the firm’s Manchester office and a key member of the group’s management board and head of the national property team, has been chosen to succeed Ward, who will remain a main board director and will be responsible for the non-legal businesses within the group.

He will also retain a significant shareholding in Gateley, the firm said.

The group said today it has been notified by certain directors and employees of their intention to sell around 4,750,000 ordinary shares of 10 pence each at a price of not less than 200 pence per placing share, which the firm said aims to “satisfy market demand” and broaden the institutional investor base of the company.

The placing shares represent approximately 4.1% of the issued share capital of the company.

Gateley posted sharp increases in revenues and profits for the six months ending 31 October 2019.

Turnover rose by 11.8% to £51.8m for the period, while profit before tax leapt by 10.2% to £5.5m.

The firm, which has offices across the Midlands, now employs 1,038 staff after a series of acquisitions over the last 12 months.