Mystery over failure of 'steady ship' Cobbetts
Firm announced solid financial results in December
The real reasons are yet to emerge for the decision of national firm Cobbetts to file a notice of intention to appoint administrators earlier this week.
Launching its financial results in December 2012 for the preceding half year, the firm described itself as a 'steady ship'. The firm's fee income for the six months was over £20m, which it said was 'consistent with the previous year'.
Cobbetts has 74 partners, almost 500 staff and offices in Manchester, Leeds, Birmingham and London.
Managing partner Nick Carr said in December: 'We're pleased with our results, operating in what continues to be a challenging economic environment.
'As forecast, there has been no real growth in the UK legal market over the last six months. Considering the prevailing market conditions, we set and met a prudent but still challenging budget, forecasting fee generation in line with the market and seeking to align expenditure to anticipated income.
'Our half year results ensure we remain on target, and new client wins mean that trading predictions for the next six months are strong. We expect to meet our financial targets by year end.'
However, Cobbetts said in a statement this week: 'Having regard to the difficult trading conditions in the professional services sector we have reluctantly concluded that the appropriate course at this time is for the firm to obtain the protection of an interim statutory moratorium to enable a sale of the business and assets of the firm to be concluded in a short time frame.
'We are also working closely with our regulator, the SRA, with all stakeholders and our professional advisers to achieve the best outcome for creditors, clients, employees and members.
'We remain confident that we will be able to provide a further positive update in the very near future.'
Cobbetts had been in merger talks with DWF, but these were called off a year ago.
Its announcement that it is seeking a 'statutory moratorium' marks the first failure of a big UK firm since the collapse of Halliwells in 2010.