DLA Piper gains £30m through all-equity partnership switch

DLA Piper’s non-US business gained £30m in partner capital as a result of the move to an all-equity partnership structure in May this year.

The capital contribution figure means non-equity partners in the firm’s international limited liability partnership (LLP), which includes offices in the UK, continental Europe and Asia Pacific, paid in on average £61,000 each to join the equity.

Figures provided by DLA for Legal Week‘s recent top 50 revenue rankings showed DLA International closed the 2011 calendar year with 743 full-time equivalent partners, of which 252 were full equity. This means the £30m was split between around 491 non-equity partners.

At the time DLA confirmed its move to an all equity partnership in March this year – following a partner vote which started the previous month – the firm said the move was intended to motivate partners by granting them a direct share of the firm’s profits, as well as an equal vote in the firm’s decisions.

However the extra capital will also help DLA reduce its bank debt, which according to 2010-11 accounts filed with Companies House earlier this year stood at £71.1m – down more than £17m on the previous year.

DLA’s decision to move to an all-equity structure followed months of debate at the firm. The move brings the international LLP in line with the US, which went all equity in 2008, when 275 partners contributed up to $150,000 (£94,700) each to join the equity.

Prior to May’s overhaul, international partners were split into three tiers, with roughly one third of partners enjoying full equity status, with the remainder split between its salaried and fixed-share rank.