Compelling bolt-on acquisition strengthens offer

Knights has announced the acquisition of THP Solicitors Limited in the attractive Thames Valley market for £2.4m initial cash consideration, and a further £1.6m over three years, subject to conditions.  In our view this is a compelling, complementary acquisition that will add around 30 fee earners and strengthen the group’s full service offering in Reading. 

Moreover, this is Knight’s 30th acquisition in 15 years and is very much in-line with the group’s growth strategy and position as the leading consolidator in the regional legal market.

As evidenced by the group’s 19% growth in Adj. PBT in FY26, Knights’ impressive acquisition track record and organic growth is delivering remarkable, sustainable Adj. PBT growth (23.5% CAGR FY16-FY26).

Knights offers highly profitable, cashflow generative growth and dividends. Hence, we believe it is materially underrated on a 5.7x cal 2027 PER: our Fair Value stays at 315p/share, equivalent to a 10x cal 2027 PER.