Parabis Group dismantled in pre-packaged fire sale

One of the first alternative business structures (ABS), the Parabis Group, has been broken up as part of an administration with the group's defendant firm businesses going to its founders.

Sky News reported over the weekend that the private-equity backed ABS was to go into administration, but expected to save 'all but a handful' of the 2,000 jobs at the company.

Sky News reported: 'One insider said the series of disposals would raise just over £50m, less than Parabis's £70m of debt. Duke Street Capital, which bought the legal services group in 2012 and pumped in additional equity last year, ‎has already written off its £30m investment.'

It has since been confirmed that Peter Saville, Ben Browne, and Anne O'Keefe of AlixPartners Services UK LLP have been appointed joint administrators over the business entities which make up the group.

Saville confirmed the group has been in discussions with its lenders and private equity backer with a view to restructuring its 'complex business' but was unable to resolve its cash flow issues despite support from stakeholders.

'As a result of that marketing process it became apparent that in the current environment a sale of the group as a whole was not a viable option and the liabilities attached to group entities also precluded a solvent sale,' added Saville.

'A series of business and asset sales was therefore agreed with the transactions completed by way of a pre-packaged administration preserving over 2,000 jobs in more than 20 separate office locations across the UK.'

Merseyside firm Carpenters Law and national firm Lyons Davidson have purchased parts of the claimant division, Cogent Law, with the latter also taking home the joint venture with Saga Law.

In news that will be welcomed by around half of the group's staff, the defendant insurance legal services businesses have been acquired by their former founders trading as Plexus Law Ltd.

The firm has said it will continue to employ more than 1,000 employees across offices throughout the UK including London, Edinburgh, Leeds, and Manchester.

The Plexus Law executive team is led by Andrew McDougall as its chief executive officer and Tim Roberts as commercial director. Law firm partner Hilary Yeo becomes operations director while Nick Addyman is to head up the consumer law division.

'This is the dawn of an exciting new chapter,' commented Roberts. 'We are building on the bedrock of strong relationships with our insurer clients and a great team of legal and support staff.'

He continued: 'We have a comprehensive service offering of the highest quality, the best people to help us deliver this, and a sound platform from which to build the business going forward. In time we will look to build on the stability today's transaction affords and further develop our service offering, including our consumer law operation.'

Roberts added that he was 'delighted' to have secured the jobs of 'so many people whose talent and commitment allow us to continue to deliver market-leading services and advice to our clients'.

The full list of completed sales and transfers is below:

John van der Luit-Drummond is deputy editor for Solicitors Journal
john.vanderluit@solicitorsjournal.co.uk | @JvdLD