This is according to Willem Jacobs, director and national head of the corporate and commercial practice at Cliffe Dekker Hofmeyr (CDH). “There has been a significant decrease in the number of large M&A deals in the pipeline, but we are still seeing a healthy number of small-to-medium-sized deals as a result of corporate restructurings, refinancing and BEE-focused transactions. These deals generally require a higher level of efficiency, more flexibility in terms of payment terms, and a value-oriented approach.”
One factor that Jacobs believes has contributed significantly to this shift in the corporate and commercial legal landscape, has been the stagnation of public markets. “Public listings have gradually slowed as the model of public ownership is increasingly falling out of favour – at least for many companies in the middle-market space, as well as those in the growth orientated stages of their maturity curves.
“Coupled with this has been a number of changes and more complex, costly requirements for firms to list,” he adds.
While listings may have slowed down, Gasant Orrie, Cape Town Managing Partner and fellow director of CDH’s corporate and commercial practice, notes that South Africa’s legal sector continues to have a stable base of companies seeking compliance and advisory services in the face of new legislation and an ever-changing regulatory framework.
"Key legislator differentiators to other markets include our complex labour law environment, our Constitutional Court, as well as our Broad-Based Black Economic Empowerment (BBBEE) legislation and ever-changing Competition Amendment Act," says Orrie. “While this constant introduction of new legislation and an increasing regulatory and compliance load can be a challenge for practitioners, it also drives companies to seek legal advice.”
From a disruptive perspective, Jacobs touches on the impact that technology is having on the legal services, especially in the face of tough economic times. "Increasingly, we’re seeing the development of innovative legal technologies to leverage services and create efficiencies that offer increased flexibility at relatively low costs to potential clients."
Ultimately, Jacobs believes it is this adaptive approach that will allow firms to offer a combination of excellence in practice and value for money.
