Regular readers of this blog will be aware that this is just the latest in a series of public listings, acquisitions and consolidation in the Australian market for IP services. As I have written previously, this brave experiment in capital-raising is the result of increasingly challenging market conditions. Public listing can provide firms with the capital they need to make the significant investments necessary to achieve efficiency and productivity gains through deployment and use of new IT infrastructure, and to address the limited growth in demand for traditional IP services through acquisitions and /or diversification, e.g. into a range of new services or into other markets, such as south-east Asian countries.
Upon completion of the acquisition of Griffith Hack, and assuming no staff movements in the meantime (far from a certainty, it must be said), an astonishing 305 of Australia’s 1187 registered patent and/or trade marks attorneys will be employed by firms held by the three publicly listed companies Xenith IP, IPH Limited (ASX:IPH) and QANTM IP Limited (ASX:QIP). That is 25.7% of members of Australian-based registered attorneys!
I would also note that one other characteristic of the changes sweeping the attorney professions in Australia has been generally poor communication with many affected stakeholders (i.e. employees). In the case of the Griffith Hack acquisition, rumours that something was afoot have been circulating for some time. The Griffith Hack staff with whom I happen to have spoken in recent weeks have generally known no more or less than the rest of us about what has been going on. I learned of the acquisition plans not from Xenith’s ASX announcement, but via the Australian Financial Review’s Street Talk column (paywalled, sorry) on the preceding day. I expect that this is also how many at Griffith Hack also initially heard the news. It was only the next morning that a trading halt was called, and the official announcement published.
While I appreciate the need for confidentiality around price-sensitive announcements in relation to public companies, I do not imagine that too many people would attempt to deny that a stock market scuttlebutt column is a terrible way for employees to learn the details of the acquisition of their employer. While some of the partners and principals of the firms involved so far appear to be in denial about the impact on staff, the murmurs I have been hearing around the traps indicate a fair degree of disgruntlement among employees – particularly those who perhaps envisioned being on a path to equity ownership themselves, and have now seen that future evaporate.
How many goodly creatures are there here!
How beauteous mankind is! O brave new world,
That has such people in ’t!
- The Tempest, Act 5, Scene 1