![Leon Allen, managing director of the latest legal debutant Qantm, says the firm is "very different" from troubled law ...](/content/dam/images/g/r/6/5/1/x/image.related.afrArticleLead.620x350.gr23nu.png/1472787969130.jpg)
![](/web/20161011030757im_/http://www.afr.com/content/dam/images/g/i/g/p/i/5/image.imgtype.afrAuthorAvatar.120x120.png/1437396900123.jpg)
The latest legal debutant on the ASX has distanced itself from troubled law firm Slater & Gordon, saying it performs transaction-based work and issues a large number of invoices.
Speaking to The Australian Financial Review ahead of the company's listing on Wednesday, Qantm managing director Leon Allen said the company has a different business model from "event-driven" law firms such as Slater & Gordon.
"We are not a law firm. We're very much a pipeline business and we're a predictable business," Mr Allen said.
"In contrast, legal practices are event driven – something has to happen before you need a lawyer."
As revealed by Street Talk in May, a consortium of IP law firms Davies Collison Cave and FPA Patent Attorneys, a Herbert Smith Freehills spin-off, listed on the stockmarket under the banner of Qantm Intellectual Property on Wednesday.
The company floated with a market cap of $331 million, at $2.22, which represents 16.5 times earnings per share. It was trading around $2.50 on Thursday.
Qantm is the third IP law firm to list on the sharemarket, following the IPO of Shelston under the banner of Xenith IP in 2015, and Spruson & Ferguson under the new name IPH in 2014.
Mr Allen said intellectual property practices such as Qantm are different from listed law firms such as Slater & Gordon in that it has a steady flow of work at any given time, it has no one client which contributes to more than 2 per cent of the revenue and it does not take cases on a no win, no fee basis.
On an average day, the two legal practices will issue 250 invoices consisting of a couple of thousand dollars each and will keep a minimal work in progress for an individual patent or trademark.
Cash conversion business
"We're a great cash conversion business, with small invoices going out all the time. Even when we run litigation matters, we issue monthly invoices and I don't leave the office unless all the matters are charged out each month," Mr Allen said.
Listed law firms felt shockwaves when personal injury law firm Slater & Gordon, once a sharemarket darling, found itself on the verge of collapse following last year's disastrous UK acquisition and accounting treatment of work in progress, which measures legal work done that is yet to be invoiced to clients. On Tuesday Slaters posted a $1 billion loss.
The prospectus says the listing will allow Qantm to poach and keep lawyers by giving them equity stakes. The access to capital will also allow the company to undertake "complementary strategic acquisitions", the prospectus says.
Mr Allen said the company has given staff $1000 worth of shares and gave them discretion to buy shares in the company. He said he is looking for IP law firm acquisition opportunities in Australia, of sizes roughly ranging from eight to 16 partners, but ruled out acquisition of law firms in other practice groups.
This is in contrast to Shine Lawyers, which is actively looking to diversify outside of its traditional personal injury practice.
"Never say never, but I cannot see a situation where we would step outside of our comfort zone," he said.
Davies Collison Cave does patent, design and trademark work and also provides specialised IP legal services including litigation, while the Freehills spinoff focuses solely on patent and design work.
After the float, the partners of the two law firms will be holding 50 per cent of the shares in the company, which are escrowed for two years. The partners will be locked into a three-year employment contract.
misa.han@fairfaxmedia.com.au