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Media Releases
2005

14 September
2005

Shepherd and Wedderburn Corporate Finance team revenues up 100% in the first four months

Shepherd and Wedderburn's Corporate Finance team has recorded one of its busiest ever summers with an impressive array of deals including IPOs on both the main market and AIM. Shepherd and Wedderburn's Corporate Finance team revenues for the first four months of the firm's financial year to 31 August 2005 are up 100% on the same period last year reflecting very strong growth.

Deals completed in this four month period include ProStrakan's IPO and Global Offering raising £40 million, ScottishPower's £96 million sale of a gas storage facility company to E.ON, Edinburgh Oil and Gas' £133 million take-over, Stagecoach's acquisition of Glenvale Transport, the US$25 million sale of Alba Resources, the £22 million sale of Troon Investments, Bidfair's £18.6 million take-over of Fairbriar, Renova Energy's £18 million IPO and SMC Group's £5 million IPO.

The Shepherd and Wedderburn Corporate Finance team has acted in 31 IPOs and secondary issues of listed securities since May 2004 and head of UK corporate finance, James Will, believes that prospects for IPOs generally in the UK market for Q4 2005 are good:

"Despite a serious confidence blip in May, London Stock Exchange statistics show high levels of UK IPO activity in the first 5 months of 2005 - 108% up by number on the same period last year*. This gave way to the usual summer slowdown. IPO activity this summer however remained comparatively strong, due in part to an overhang from Q2 with companies targeting impact before the 1 July cut-off date for the new prospectus regime and then slipping past that date."

"The full summer IPO statistics just released by the London Stock Exchange show this comparative strength with IPO numbers up 25% in the three months ended 31 August as compared with the same summer period last year. Surprisingly IPOs raised £353 million in August 2005 - traditionally the most quiet month - as compared to £106 million last August."

Will continued: "This summer's significant increase in IPO numbers - and the August monies-raised figure - is very encouraging and augurs well for Q4. However the key question is whether the level of IPO activity in Q4 will return to pre-summer levels."

"Our own work on IPO's due to impact in late 2005 continues at a high level and, based on feedback from investment banks and brokers with whom we work closely, we believe that IPO activity on the London markets in Q4 will be very buoyant, although probably not returning to the pre-summer exuberance in terms of actual numbers of IPOs.

"Generally however there appear to be some bigger IPOs in the pipeline so total monies raised in Q4 might well compare favourably with pre-summer levels. Investing Institutions - and indeed hedge funds - have no shortage of cash at the moment but they will continue to be selective looking carefully at both quality and price. There is clearly less appetite for those AIM IPOs which are small and risky. While IPO candidates for Q4 cover a wide range of sectors, our straw poll indicates that the specialty finance, oil, natural resources, medtech, telecoms, on-line gaming and green energy/environment sectors will all feature."

Commenting on the performance of the firm's corporate finance team in the first four months, James Will said: "We've had a great start to the year, especially in terms of high profile client work and new client wins. This robust performance shows the success of our strategy of offering UK-wide high quality corporate legal services from our four offices - Edinburgh, Glasgow, Aberdeen and London - and the strength and depth of our corporate finance team.

"Our own deal pipe line is strong for Q4 but, as ever, our future growth will be based on continuing to develop our relationship with existing clients, grow our client base and make the most of our geographical diversity."


Note to Editors:

1. London Stock Exchange Statistics:

Number of IPOs in the period running from January to May (Inclusive) 2004 and 2005

  AIM London Main Market Combined
January to May 2004 82 9 91
January to May 2005 163 26 189
Percentage Increase(2005 cf. 2004) 99% 189% 108%

Number of IPOs in the period running from June to August (Inclusive) 2004 and 2005

  AIM London Main Market Combined
June to August 2004 84 11 95
June to August 2005 102 17 119
Percentage Increase(2005 cf. 2004) 21% 55% 25%

Source: London Stock Exchange.

2. More detail on Shepherd and Wedderburn deals in first four months of Shepherd and Wedderburn financial year ended 31 August 2005:

  • acted as lead legal adviser to ProStrakan Group in its London main market flotation when it raised £40 million by way of a Global Offering of new shares. ProStrakan's market capitalisation at the issue price was approximately £187 million.
  • acted for Scottish Power in the £96 million sale by Scottish Power Energy Management Limited to E.ON UK plc of a special purpose vehicle established in relation to the construction and operation of a gas storage facility at Byley, North Cheshire.
  • acted on behalf of Edinburgh Oil & Gas in connection with a £133 million takeover by Dyon UK Limited effected by way of a scheme of arrangement. Dyon now owns the entire issued share capital of EOG and with it a 5 per cent stake in the 'Buzzard' oil field.
  • acted for Stagecoach Group in its strategic acquisition of Liverpool-based Glenvale Transport Limited, one of the last independent city-centre bus operators.
  • acted for majority shareholders in Alba Resources in the US$ 25 million sale of its entire issued share capital to Nautical Petroleum.
  • advised BidFair on its £18.6 million offer for FairBriar PLC, a listed company involved in residential property development and serviced apartments in the south east of England. BidFair is a vehicle owned equally by Scarborough Property Company plc, Bank of Scotland and a Singaporean company, Centrepoint Properties Limited.
  • acted for the vendors in the £22 million sale of the entire share capital of Troon Investments to Chemring Group plc.

3. General

Shepherd and Wedderburn is a leading UK law firm, with 54 partners and over 460 staff. With offices in Edinburgh, Glasgow, Aberdeen and London, the firm provides corporate, commercial, public sector and private clients throughout the UK and abroad with a full range of legal services. http://www.shepwedd.co.uk/mediacentre/


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