By Sarah Thompson , Anthony Macdonald , Joyce Moullakis 

Australian Financial Review

PwC, headed in Australia by CEO Luke Sayers, is doing the legal work on Scottish Pacific's mooted initial public offering. Darrian Traynor

PwC, headed in Australia by CEO Luke Sayers, is doing the legal work on Scottish Pacific’s mooted initial public offering.
Darrian Traynor

Accounting giant PwC is seeking a larger piece of the initial public offering market, bulking up its legal team and aiming to pinch IPO-related work off the big law firms.

Street Talk can reveal PwC has already secured its first gig and is acting as legal adviser to Sydney-based private equity firm Next Capital on the float of its portfolio company, Scottish Pacific.

While Scottish Pacific’s IPO is not the biggest deal of the year – or even expected to set new heights in terms of legal work or complexity – PwC’s emergence as a legal adviser has not gone unnoticed in the legal establishment.

Heavyweights Herbert Smith Freehills, Gilbert + Tobin, King & Wood Mallesons and Clayton Utz, in particular, have had a stronghold on equity capital markets deals in recent years, whether it be working for listing companies or their broking syndicate. However, PwC is seeking to bust open the club, adding legal services to its existing arms which include valuation and audit work.

IPOs have been a rich stream of legal work for the major firms since the window re-opened almost three years ago. Legal advisers are typically paid fees worth more than $1 million for the larger deals. WiseTech Global, for example, booked a $1.1 million payment for Clayton Utz in its IPO prospectus.

Sources said PwC’s mandate at Scottish Pacific came as the firm hired Baker & McKenzie corporate partner Ashley Poke, who has a long-standing relationship with Next Capital’s senior team.

[The firm also hired a pair of senior Mallesons lawyers – Tony O’Malley and Tim Blue – in 2014.]

It means PwC lawyers are up to their necks in Scottish Pacific’s due diligence and prospectus, ahead of float marketing which is slated to begin in a fortnight. PwC is working alongside investment banks Citi and Goldman Sachs on the float, while Reunion Capital Partners is also involved as financial adviser.

It’ll be interesting to see whether PwC can get synergies out of its legal and accounting footprint. It is understood rival Deloitte has the investigating accountant’s role and audit mandate for Scottish Pacific.