The future's bright; the future's private equity-owned.
DAC Beachcroft in in talks to sell half the firm, RollOnFriday understands.
Limerston Capital, a private equity fund, is in exclusive talks to purchase the Claims Solutions Group (CSG) from DACB, according to a source.
Held as DAC Beachcroft Claims Ltd, CSG handles personal injury and specialist claims on behalf of insurers and corporate clients. It operates in 12 UK locations and the Republic of Ireland, and employs over 1,000 people – roughly half of DACB’s workforce.
In a statement DACB told ROF, “Following an in-depth strategic review of our business, we have decided to explore all our options to enhance the long-term investment into our Claims Solutions Group”.
The firm said that CSG was operating in a “very dynamic market” [translation: cratering] and "we are constantly assessing those markets and adapting our strategy to ensure that we are able to invest in the future of CSG in a way that enhances CSG’s overall offering and benefits our clients”.
UK-based Limerston describes itself as a lower mid-market buyout fund focused on “driving value through buy-and-build and operational transformation”.
Its current investments include the Village Bakery chain and Arch Sciences, the laboratory research group.
DACB staff have described their firm as “two firms in one”, with the LLP on one side and CSG on the other. “There is a clear divide between the fat cats in the LLP and the poor personal injury lawyers in the Claims Solutions Group side of the business”, said one person.
Some spoke of a pecking order where “the personal injury side of the business is considered the lowest of the low within the firm”, and its staff are paid "like peasants whilst the LLP live in rarified air”.
“CSG is very much seen as the poor relation and unfortunately, over time, that perception is not getting any better”, said another person.
That sad split may soon be resolved if Limerston adds CSG to its investment portfolio, in which case smarting CSG staff will have new stablemates. If they’re lucky they could score boutique breaks at Limerston-owned Largo Leisure Holidays. If not they could be experimented on at Concept Life Sciences.
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Comments
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Worked well for Plexus. Go for it!
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Not sure that anyone at DACB lives in “rarified air”. They pay crap and like BLM aren’t really a city firm, but a mainly defendant insurance firm that sends that work out to the shires.
42
23
Is DAC Beachcroft about to go under?
41
23
Duke Street 2.0?
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25
The more profitable LLP splitting with the “Claims Solutions” volume side of the business… so the exact opposite of Clyde & Co merging with BLM.
44
24
Mediocre firm with over praised management finally cuts off gangrenous leg ….
44
27
It’s not hugely surprising. The CSG wing has lost most of their best over the last few years.
35
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More profitable part of business sells less profitable part shocker. Also it’s not half the business and £14m is the EBITDA as reported elsewhere so not the sale price. Get some proper journos working at ROF FFS.
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Down with the DACB LLP bourgeoisie!
As always the equity partners will get a nice windfall, all while CSG is left being run by a mediocre hedge fund with no experience of the legal industry.
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10:47am, if there are around 2,500 people in DACB overall and over 1,000 are in CSG, that is about half the biz, no?
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Good move for DACB, worked very well for HD. Feel sorry for the solicitors who will be booted out and replaced with AI - this will be the end of the road for a great number of people . Over the next couple of years these sorts of deals are going to be so common. The speed we will move to an unrecognisable profession is going to be breathtaking.
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Guessing there are going to be quite a few firms slicing off chunks in the coming year.
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Are there lots of full service mid-market firms which also have a bulk claims/conveyor belt division? Must be tempting to flog them off to raise easy capital with the bonus of feeling posher.
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Far better for DACB if it is disposing of CSG entirely. Taking in an investment means they have to deal with the necrotising influence + demands of a PE mob. Never seems to go well.
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With personal injury, property damage and fixed costs all coming towards the end of the lucrative times it would be a brave company to buy this DACB arm.
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Anyone at DACB who does PI work for insurers on panel rates is in for a nasty shock once this goes through. Seen it all before. Never ends well for the individuals.
DACB is officially a firm in turmoil.
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“Some spoke of a pecking order where “the personal injury side of the business is considered the lowest of the low within the firm””. It’s not just your firm, the rest of the industry also considers the PI side to be the lowest of the low.
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It’s the DAC Beachcroft Way
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Isn’t the issue with this move, that if you don’t offer a full service to your insurer clients, you don’t make the cut on new slimmed down panels? Isn’t that why Clydes bought BLM?
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This article doesn't really tell us anything... A law firm looks at potential options for the future of its business... not exactly screaming "EXCLUSIVE"!
If a deal is being done, I am sure the bods at DACB will be looking at the situation of other PE backed firms and making sure they avoid the pitfalls!
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This is such good news for everyone at DACB who works on the commercial side. Maybe they will use the cash to actually pay market salaries
....LOL JK.
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Are personal injury battery farm employees actually surprised that they are looked down upon? Do they seriously turn up to their high volume, high repetition, low complexity work and go "I am the pinnacle of law"? Mad.
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That famous DACB culture. Not a hint of this news until a hurried email from the managing partner on Thursday: we've been rumbled, best tell the troops. What a joke.
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PI lawyers should re-train as teachers. Better pay for starters.
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Wombles considering similar strategy by selling off their Newcastle office
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There is absolutely no future in PI defence litigation. Insurers do not want to pay fair rates for the work and the whole culture has been dumbed down since the 2000s. When I worked at DAC (not DACB) I was working with some of the most technical disease and PI lawyers going but as time has gone on and fixed fees entered the market the whole side of that aspect of the industry has turned into a steaming pile of shit. ELPL Insurers should all merge and hire ex-Greggs/Aldi staff to punch numbers into a computer to make an offer. From experience that does not always work and offers are far too low. When insurers lose all their good lawyers and have nowhere to turn when matters go trial they are going to feel like they have been screwed by a Blue Whale and it will be too late.
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Very strange when your sales pitch is you can do everything. Let the exodus begin.
That said, who doesn't like a cool million bucks each?
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Whoever gave a thumbs down above is a moron
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Soon insurers won’t have any lawyers left. I wonder what they will do?
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No lawyers left? Then they'll use Kennedys I imagine
26
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Surely not Kennedys....Time to close shop
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Look at insurance firms: Plexus’ troubles, BLM having to be taken over by Clydes, big firms with 2 equity streams in which insurance lawyers are the lowest.
Even Keoghs was taken over by Davies.
Looks like working for the devil doesn’t pay any more.
There are some good litigators in the insurance firms. They should get out whilst they still can.
Otherwise, it’s shelf stacking at Tesco.
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Defendant PI lawyers soon to be obliterated by AI. Get out now.
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Insurers have squeezed panel rates so hard it's basically a well fed partner, a really overworked senior associate and then a team of juniors.
It stays like that until the senior associate realises they are a mug and leave.
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Classic DACB, screwing the staff while a few lucky incompetents make a fortune. CSG equity effectively de-equitised without knowing about it.
V difficult future for a cohort of clientless partners in CSG. The new owners will keep the workers but no way will they want a flabby middle management ‘ops’ layer, or a bunch of ‘service line’ heads whose job is simply to clap more loudly than the other sycophants.
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At least DACB are being up front about the investment/sale. That’s more than the 4 at Plexus did in 2019. They kept it very quiet from the entire Partnership and took their millions. They didn’t mention a word until after the deal was done. That’s one of the reasons why all 4 were subsequently removed by their now ex-Partners.
Rumour has it at least one of the 4 is going to turn up at DACB in February 2024. Now that WILL be interesting.
ps - ROF probably won’t post this comment and we all know why.
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The CSG is an unprofitable mismanaged nightmare - not sure who will be lining up to get their hands on it
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S&G also for sale if anybody has a quid!
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Probably result in redundancies in IT, HR and finance
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Why don’t they get together and do an MBO?
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Shocking that staff found out after the news was leaked - poor communication, and people management.
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This seems like a [redacted] master mind idea.
The guy was clueless at costs, not surprised his impact has led to DAC cutting losses now.
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At first I was afraid, I was petrified,
Kept thinking I could never live without CSG by my side,
Then I spent so many nights thinking fifty quid an hour was wrong,
And I grew strong,
And decided that you were gone,
And now we’re back, touting you about,
At only fifty quid an hour, we all know you’ve got no clout,
You should have changed that stupid hourly rate,
You knew that profit was key,
And yet you kept pandering to the insurers,
Who want it done for freeeee….
Go on now, go, walk out the door,
The hourly rates are so terrible,
We don’t want you anymore,
Weren’t you the one who said we’ve nothing to fear from AI?
We need to sell you quickly,
Before the defendant insurance markets die….
Oh oh oh
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Morale at DACB claims was on the floor for the insurance bods before this news. It is now underground I hear
Expensive lateral hires coming along in the North had better be brilliant as the bosses are expecting them to be the nuts given their pay packets. If not they’ll ensure they are out fast as hard working junior bids can’t keep subsidising poor performance by highly paid people at the top.
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Half the people trumpeted by the bosses up North are from Plexus. Trumpeted means leaked, by the way.
Hope they are mustard. So far the Partners from Plexus joining have been in compliance and audit and have not added a £ to turnover. I do wonder why Plexus let them walk ! Ahem.
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Even Keoghs!
hilarious
true too
when it’s “even Keoghs “ we know the insurers have had it. Lots of school leaves following a CMS and calling it litigation 😂
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i cant see those ex- Plexus hires working out - they tried to make a credible CAT team work in ...ty Tower but failed... only to repeat that mess at DACB it seems
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Pipe down Aviation boy.
You won’t be spouting your clueless rubbish soon when you’ve lost your loan capital, have no job to go to as no one in the market will take your vile toxicity and HMRC come calling for unpaid tax.
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Ridiculous that in a RoF article about DACB that Plexus management sycophants are so obsessed and jealous about former staff, who have moved onto much better things, that they have to criticise them in a nasty manner. Very very sad and demonstrates in a microcosm why Plexus will not last much longer and is a toxic brand.
Good luck to DACB