DWF acquires Whitelaw Twining Law Corporation to expand into Canada
The acquisition is valued at up to CA$42.6m (£27.7m)
International law firm DWF has announced it has acquired Whitelaw Twining Law Corporation, a leading Canadian law firm, and TWK Management Limited, an intra-group services company.
Founded in Vancouver in 1979, and now headquartered in Vancouver, Whitelaw Twining has 16 partners and more than 200 people in total, with offices in Vancouver and Calgary. Its management team consists of Daniel Shugarman (country managing partner), Kim Wigmore (head of business development) and Michael Silva (head of operations).
The firm specialises in insurance, commercial litigation, personal injury and dispute resolution. DWF said the transaction marks the next step in DWF's North American strategy, bringing a strong strategic fit, greater scale and an enhanced platform in North America, which will align to the Group's existing Mindcrest and claims operations in Chicago.
It said there is a clear synergy opportunity with DWF's existing Canadian claims and adjusting businesses and global insurance sector focus and clear business overlap with DWF, especially its focus on the London insurance market.
Whitelaw Twining's reported revenue for the 12 months ended 31 December 2021 was CA$34.5m (£20.0m), with pro forma EBITDA of CA$5.3m (£3.0m) (adjusted to reflect DWF’s partner compensation and reporting policy). Whitelaw Twining's gross assets at 31 December 2021 were CA$21.6m (£12.6m).
The acquisition is valued at up to CA$42.6m (£27.7m) with total consideration of up to CA$26.0m (£16.9m) payable in shares and cash, and debt of CA$16.6m (£10.8m) to be repaid or assumed, with completion anticipated by the end of 2022.
Initial consideration consisting of an estimated CA$17.8m (£11.5m) in newly issued DWF shares will be paid on 3 January 2023. Cash consideration of CA$4.4m (£2.9m) will be paid in February 2023. Contingent share consideration with a value of up to $3.0m (£2.0m) may be paid provided certain 2022 calendar year financial targets and criteria are met.
The Group will assume estimated external net debt of CA$5.9m (£3.8m) and repay shareholder debt of CA$10.7m (£7.0m). Of this shareholder debt, CA$9.2m (£6.0m) will be repaid on completion with the remaining balance of CA$1.5m (£1.0m) payable in February 2023. This will be offset by partner capital contributions from the Whitelaw Twining shareholders of $2.0m (£1.3m), due by February 2023.
DWF will issue 16,504,757 new ordinary shares in the company on 3 January 2023. These will be subject to the customary lock-up period of approximately five years, in line with the Group’s existing agreements.
An employee share program will be created with a value of $0.8m (£0.5m) for the purpose of remuneration and incentivisation of Whitelaw Twining employees by 31 December 2022.
A partnership will also be established in British Columbia to provide Legal Advisory and Connected Services through the operations of Whitelaw Twining and DWF's existing loss adjusting practice in Ontario, while a relationship agreement will be entered into between DWF and Whitelaw Twining’s Alberta practice.
The completion of the acquisition is subject to the satisfaction of certain pre-conditions, which are expected to be met by the end of 2022.
Sir Nigel Knowles, Group CEO at DWF, said: “We are delighted to be enhancing our offering in the Canadian legal market. Whitelaw Twining is one of the country’s top legal businesses and represents a high quality opportunity for our clients. It also allows us to expand our claims and adjusting presence in Canada and wider Connected Services and Mindcrest capabilities in North America.
“We have worked hard to ensure DWF is in a strong position so we can confidently make these key international acquisitions, enabling us to make further progress against our strategy to be the preeminent global provider of integrated legal and business services.
"I look forward to working with our new colleagues. We identified a strong cultural fit with the Whitelaw Twining management team and the values and ways of working within their business. Their emphasis on internal collaboration over competition and on creating a progressive, innovative, and supportive working environment reflect our own 'one team' culture.”
Daniel Shugarman, Whitelaw Twining’s country managing partner, said: “We are excited to be forming a partnership with the DWF Group, combining our respective Legal Advisory and Connected Services capabilities for the benefit of our clients. Over 40 years, Whitelaw Twining has gone from a three-person practice in Vancouver to a diverse, full-service litigation law firm serving clients in 17 languages. This is the next step forward for our business, further strengthening our position in Canada and creating opportunities for our colleagues to support clients globally.
"We already know DWF well, in particular, its Canadian claims and adjusting practice. We recognise the shared values and 'one team' approach of our two businesses and we are delighted that through DWF Group's listed company status we are able to make our Whitelaw Twining colleagues shareholders with an opportunity to benefit from our future success.”
