Listed law firm Slater & Gordon has announced a plan to purchase personal injury firm Keddies Lawyers for A$35m.

The acquisition of Keddies, which has forecast full year revenue of approximately A$25m will be a major boost to Slater & Gordon's goal of increasing its share of the NSW personal injuries litigation market.

"We've said from when we listed that leading the consolidation of the Australian personal injuries market was a prime aim for us, with Queensland and NSW the main targets,” Slater & Gordon managing director Andrew Grech said.  "Our recent acquisition of Trilby Misso has gone a long way towards our market share goals in Queensland and now the Keddies acquisition will give us a huge lift in NSW, in particular in Greater Western Sydney."

The addition of Keddies’ four offices in NSW and its Brisbane office make Slater & Gordon a clear market leader across the three eastern states of Australia, which account for around 85% of the national personal injuries litigation market.

Under the proposed agreement Keddies will be fully integrated into Slater & Gordon within as short a time frame as possible.  The Brisbane and Wollongong offices will relocate to the existing Slater & Gordon offices in those locations, while the Redfern, Ashfield, and Liverpool offices will be rebranded and together with Slater & Gordon's existing Parramatta office, become hubs for Slater & Gordon's personal injuries practice in western Sydney. 

Keddies partner Scott Roulstone said the acquisition was an “amazing opportunity” for the firm, which started in 1977 with less than 10 staff.

The transaction is subject to the execution of a formal agreement and further due diligence, but is expected to be completed by mid January 2011.  The A$35m offer will comprise of A$3.7m in shares, the take-up of Keddies' approximately A$11m debt and a cash payment, some of which will be deferred for up to 30 months.

While there is close to sufficient capacity in Slater & Gordon's existing debt facility to fund the transaction, the company has negotiated an increased facility of A$95m with its current financiers Westpac.