It turns out Manchester and Mumbai have more in common than I thought. Legal outsourcing is hot news again. Thomson Reuters (TRI) may seem a million miles away from the humble Quill Group in the UK, but they are both on the same track. Thomson have just bought Pangea3 in Mumbai, and from their 2010 accounts the modest Quill Group are now as much driven by legal accounts outsourcing as practice management software development. Quill was one of the few independent groups in the UK to see good growth through late 2009 and early 2010, just when TR was weathering its dip. And recession or no recession when CPA Global went for a £440m deal in early 2010 all the M&A fraternity rediscovered juices they thought had been banned.
No numbers are disclosed yet by TRI, but hopefully they have not repeated the lunacy of the CPA price. It remains to be seen whether Pangea3 fits better with the Derwent patent businesses or their legal ones (CPA stood originally for Patent Annuities after all). But there is a touch of insanity around global outsourcing in legal circles currently and it is timely to revisit what Quill have done well. Quill’s Pinpoint outsourcing business is not a flash in the pan; it has taken over a decade to build. Quill’s USP is more than tech delivering ROI for their clients, it is a genuine “in it together” sink or swim empathy. It is born of a technology competence, but not a bleeding edge one; tech is a means to an end.
So in the UK will Pangea3 transform Thomson’s Sweets? No doubt global M&A strategy wonks are delighting in the modern equivalent of the counting of medieval angels on pin heads. Sweet & Maxwell’s client empathy is much closer to the High Street than the global elite so perhaps they’d be better emulating the Mancunian leap from elegant quill to pinpoint accuracy.
And before anyone says why are you comparing a £1m outfit in Manchester with £440m global deals: (1) the outfit in Manchester hide their light under a bushel and are a focused group of c £4-5m now; (2) CPA global were not much bigger than Quill only 5 years ago; (3) it is important in a bubble to ignore the £440m headline and remember that globally Pangea3 is estimated to have sales of c £20-25m, smaller than Tikit; CPA International reported ‘09 sales of only £23m. (4) We’re in one of those “all bulls have horns, therefore everything with horns is a bull” arguments; sometimes its just bull, but my money is on the £440m being a mistake that no-one can own up to for a few years yet.
There’s a lovely web site called “The Straight Dope” with the tag line: “fighting ignorance since 1973 (its taking longer than we thought)”.
No numbers are disclosed yet by TRI, but hopefully they have not repeated the lunacy of the CPA price. It remains to be seen whether Pangea3 fits better with the Derwent patent businesses or their legal ones (CPA stood originally for Patent Annuities after all). But there is a touch of insanity around global outsourcing in legal circles currently and it is timely to revisit what Quill have done well. Quill’s Pinpoint outsourcing business is not a flash in the pan; it has taken over a decade to build. Quill’s USP is more than tech delivering ROI for their clients, it is a genuine “in it together” sink or swim empathy. It is born of a technology competence, but not a bleeding edge one; tech is a means to an end.
So in the UK will Pangea3 transform Thomson’s Sweets? No doubt global M&A strategy wonks are delighting in the modern equivalent of the counting of medieval angels on pin heads. Sweet & Maxwell’s client empathy is much closer to the High Street than the global elite so perhaps they’d be better emulating the Mancunian leap from elegant quill to pinpoint accuracy.
And before anyone says why are you comparing a £1m outfit in Manchester with £440m global deals: (1) the outfit in Manchester hide their light under a bushel and are a focused group of c £4-5m now; (2) CPA global were not much bigger than Quill only 5 years ago; (3) it is important in a bubble to ignore the £440m headline and remember that globally Pangea3 is estimated to have sales of c £20-25m, smaller than Tikit; CPA International reported ‘09 sales of only £23m. (4) We’re in one of those “all bulls have horns, therefore everything with horns is a bull” arguments; sometimes its just bull, but my money is on the £440m being a mistake that no-one can own up to for a few years yet.
There’s a lovely web site called “The Straight Dope” with the tag line: “fighting ignorance since 1973 (its taking longer than we thought)”.
3 comments:
One thing that the legal, financial, educational, and news information giant, Thomson Reuters, has not been accused of is ignorance. Given that this multi-billion-dollar company has acquired 100% of the shares of an Indian legal outsourcing provider, after also recently deciding, for "strategic" reasons, to sell its profitable and high-profile U.S. bar exam preparation course (BAR/BRI), you can assume that some very smart money is betting on a tectonic shift in the Western legal landscape.
Padmavathi Shanthamurthy
SDD Global Solutions
High-end Legal Outsourcing
Thank you, nice job! This was the stuff I had to have.
Many thanks Padmavathi. I agree - big shifts - both pull from the sub-continent and push from basic economics across this pond. I'm still not convinced, however that the deep pockets even of TRI or REL etc should be raided to the extent that they have been, however. A few lucky early bird vendors may be laughing, investors chasing reliable divi's to 2012+ may not be so chuffed. We'll see.
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