Law firm Gordon Dadds is to pay over £6m less for Ince & Co than the discounted figure it announced in January, according to its year-end report.
"The consideration for the acquisition of Ince overall is estimated at £21m [$25.8m], of which £15m is turnover based and payable over the next three years," Gordon Dadds said in its report for the fiscal year ending 31 March.
A spokesperson for the group told TradeWinds the revision was based on a more realistic estimate of the value of the business.
The total takeover price was estimated at £27.3m when the deal was completed in January, plus a grant of options in new Gordon Dadds shares, which are listed on the London Stock Exchange.
The transaction had been priced at £34.0m when the deal was first announced in October, based on a more expansive deal that was later downsized.
Adrian Biles, group chief executive of Gordon Dadds, said the acquisition of Ince in the UK and China was a "major highlight" of the past financial year.
“The integration phase of Ince is now complete and I think it’s noteworthy that we did not suffer any partner or client losses during and since the transaction," he said in the firm's financial report.
"The opportunity to cross-sell by practice area and by geography provided by Ince is huge."
The firm was forced to revise its takeover plan after it failed to come to arrangements with Ince's international network of affiliates in Germany, Greece, Dubai, Singapore and Hong Kong.
International network
Gordon Dadds also revealed more about how these international affiliates will be incorporated into the group.
Partners at these international Ince offices will be remunerated according to levels of revenue achieved during a three-year period, Gordon Dadds said in its year-end report.
The group said it estimates that a total of £12m will be paid over the three years ending 31 December 2021.
Arrangements to take control of Ince's locally owned offices in Germany, Greece, Dubai, Singapore and Hong Kong were finalised in early April.
Gordon Dadds has no ownership in any of these affiliated entities, which will continue to be known as Ince.
Positive results
Overall, Gordon Dadds posted positive results for its last financial year.
Adjusted profit before tax was £5.9m for the year, which is 141% above the £2.5m posted last year.
Similarly, adjusted diluted earnings per share were £0.188 for the year, which is 79% more than in 2018.
Revenue saw a year-on-year increase of over two-thirds, growing to £52.6m from £31.2m in 2018 on the back of the firm's acquisition of other businesses.
Operating profit saw an even greater improvement, having grown from £8.8m last year to £15.2m this year.
Gordon Dadds paid a dividend per share of £0.06 for its fiscal year.
"Looking forward, we are well-positioned for significant growth as we look to leverage our existing infrastructure through cross-selling, new client wins and further new hires, acquisitions and alliances," said Biles.
