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Listed firm merger terminated
A “significant and unprecedented” merger first announced to market in October is no longer going ahead.
Emma Musgrave
The proposed merger between Australian Family Lawyers and GTC Legal Group has been terminated.
The cease follows AFL executing a share sale deed to acquire 100 per cent of the issued share capital of GTC just a month ago, noting the merged entity would bring a “seminal moment for the personal legal services industry”.
In a statement to the market this morning (24 November), the listed firm said the termination of its proposed merger with GTC Legal Group is effective immediately.
“AFL advises that the GTC transaction has been terminated with immediate effect. AFL will engage with GTC to finalise the arrangements regarding the termination. In the meantime, AFL will immediately cease all work on the GTC transaction,” the statement said.
“AFL will continue to apply its focus on its own ongoing operations and will provide further updates to the market as appropriate.”
James Stevens, managing director of the GTC Legal Group, said: “We are disappointed to have had to terminate our proposed merger with AF Legal. GTC was fully committed to progressing the transaction and [was], until now, ready to complete what we had considered to be a merger of equals.
“Unfortunately, our assessment in the light of the accuracy of certain disclosures made to us by AFL is that we now believe the best course of action for our shareholders is to exercise our right to terminate.”
Lawyers Weekly spoke to AFL executive director Grant Dearlove earlier this month following the initial merger announcement.
At the time, Mr Dearlove described the proposed merger as both “significant and unprecedented”.
“The merger is significant and unprecedented due to the fact that the market has previously been highly fragmented with a surplus of 18,000 firms that have an average of three lawyers per firm. Consolidation of this magnitude has never been seen before — AF Legal Group will be the largest personal service firm in Australia in both family and criminal law, especially with ongoing expansion into growing verticals,” Mr Dearlove told Lawyers Weekly.
“Smaller general practices are required to invest in modernising. The competitive landscape is set to change as AF Legal reaches more clients and pursues its aggressive growth strategy. With 26 offices in its network and another 30 areas identified, the firm is excellently primed to dominate the market in future.”
Correction: An earlier version of this article had a headline that incorrectly stated that AFL had terminated the merger. The headline has now been amended to reflect that the merger was terminated by GTC Legal Group.
Emma Musgrave
Emma Musgrave (née Ryan) is the managing editor, professional services at Momentum Media.
Emma has worked for Momentum Media since 2015, including five years spent as the editor of the company's legal brand - Lawyers Weekly. Throughout her time at Momentum, she has been responsible for breaking some of the biggest stories in corporate Australia. In addition, she has produced exclusive multimedia and event content related to the company's respective brands and audiences.
Prior to joining Momentum Media, Emma worked in breakfast radio, delivering news to the Central West region of NSW, before taking on a radio journalist role at Southern Cross Austereo, based in Townsville, North Queensland.
She holds a Bachelor of Communications (Journalism) degree from Charles Sturt University.
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