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Brexit hits profits for Burness Paull

The Scottish corporate law firm said the deal disruption wrought by Brexit had had an impact on profits, but that transactions are getting ‘back on track’.

Despite stalling on deals in the aftermath of Brexit, many private equity transactions are back on track, Philip Rodney, chairman of Scottish law firm Burness Paull told pfm.

“In the immediate aftermath of the Brexit result we saw several corporate deals pause to take stock, but almost all of these transactions are now back on track with a number having completed, including several mid-market private equity driven deals, demonstrating that for many businesses growth is essential and standing still is not an option,” said Rodney.

Burness Paul, which reported its annual revenue results this week, claimed that a reduction in profits was a result of “post-Brexit uncertainty as leading to a significant pause in activity and client instructions.” The firm recorded a profit of £22.6 million, down 3.4 percent from £23.4 million in 2015.

“Unlike most firms, our financial year runs to 31 July rather than 30 April. The anticipation of, and the changed circumstances brought about by the outcome of the EU referendum inevitably impacted adversely on the last couple of months' trading and are reflected in our results,” said Rodney. “The decision to leave the EU has been felt widely, as can be seen from organisations reporting across all sectors of the UK business community. While there will continue to be uncertainties, we are beginning to experience nearer normal market conditions as we work with our clients to support them in these changed circumstances.”

Despite the expected slowdown of growth following Brexit, opportunities will still exist for international investors, said Rodney. “Our corporate deal activity levels have been strong during the last 12 months notwithstanding a degree of fragility in Scotland’s economic performance, and whilst fears of a slowdown in growth may come to fruition, opportunities will exist for a number of our clients to capitalise on. For example, we anticipate an increasing role for the international buyers and investors in the Scottish and UK markets, markets with which they were very familiar before the Brexit vote.”

Burness Paull has offices in Aberdeen, Edinburgh and Glasgow. The firm’s private equity practice counts AXA Private Equity, Maven Capital Partners and BlueGem Capital Partners among its clients.