DWF unveils €50.5m acquisition of Spanish independent firm RCD
UK-listed firm will use deal as platform for expansion into Portugal and Latin America
Listed UK firm DWF has acquired 40-partner Spanish outfit Rousaud Costas Duran (RCD) for up to €50.5m (£42.5m) in shares and cash. The move marks DWF's second European deal following its listing on the London Stock Exchange in March and subsequent acquisition of the Warsaw office of US firm K&L Gates.
DWF is paying an initial consideration of €35m for RCD, of which €7.4m is in cash and €27.6m is through the issue of new shares.
The package also involves deferred payments that are partly dependent on the Spanish firm, which has offices in Madrid, Barcelona and Valencia, meeting performance targets over a two-year period.
RCD, which formed an exclusive alliance with DWF in June, posted revenue of €35.7m (£31.6m) in its last financial year, which ended on 31 December 2018, with 'pro forma' EBITDA of €8.1m (£6.8m) – the figure having been adjusted to DWF's partner compensation policy. RCD's equity partners have agreed to a five-year lock in.
DWF said RCD's strengths in insurance, real estate and financial services matched its own and stressed the firm's ‘innovative culture'.
And it signalled it would use RCD's links in Portugal and Latin America as a platform for expansion into those markets.
Ignasi Costas, RCD co-managing partner, said: 'We are confident that this decision will result in lots of benefits and opportunities for our clients and our people.'
DWF CEO Andrew Leaitherland added: “In RCD we have found a partner that shares our mission to do things differently and to use technology to face the challenges awaiting the legal profession in the future."
DWF's new Spanish arm will be branded as DWF RCD and both the firm's founders, Costas and Adolf Rousaud, have been appointed as members of DWF's Continental Europe executive committee.
The news was announced on the same day as the release of DWF's half-year financial results which saw a 10% increase in net revenue against a 2% rise in gross profit, although the firm's gross profit margin slipped by 4%.
DWF has offices in the USA, Canada, Ireland, the UK, Germany, Poland, Italy, Qatar, the UAE, Singapore and Australia. Its footprint extends further when associated offices are included.