Kemp Strang is not the biggest player in the Sydney mid-tier market - but that's not necessarily a bad thing

It's a perennial question for mid-size firms: how much expansion can a firm handle before it risks compromising its culture? In recent years we have seen a number of them - Mills Oakley, Herbert Geer, HWL Ebsworth, to name but a few - embark on the journey of expansion beyond their original home cities to create a national or East Coast practice.

Sydney firm Kemp Strang represents the other side of the coin. This 26-partner, full-service firm is a small, tight-knit team which intends to stay that way. And, while managing partner Stephen Godding is not a man to exclude any long-term possibilities, large-scale expansion is off the agenda for the foreseeable future.

Food fight

One of Kemp Strang's signature specialisations is its rural & agribusiness practice, an area which can only grow in light of increased regulation of Australia's natural resources. Godding describes it as divisible into three areas: transactions involving rural land and water rights, irrigation schemes and rural litigation.

Typical clients at the moment are rural investment funds, investment company PrimeAg and industry bodies such as Cotton Australia and Irrigation Australia. But Godding adds that there is the potential for work to come from further afield in future. "Sovereign wealth funds from the Middle East and Asia may see the purchase of Australian properties as a viable proposition - countries are looking for food security and Australia has a huge capacity for production," he states.

The concept sounds unlikely, yet there is a solid foundation to it. The Qatar Investment Authority, for example, is reported to have a US$1bn fund for investing in food and agriculture projects around the world, and Qatar is hardly the only nation - in the Gulf or elsewhere - with a paucity of arable land and an interest in securing food supply. The drought is having an effect of slowing some types of rural transactions - livestock-based asset transfers, for instance - but increased awareness of the value of water resources creates opportunities in other areas. "There have been continuing changes to water rights entitlements at the state level and clients needed to be advised on that," Godding explains.

Corporate

Kemp Strang's typical clients for corporate and M&A work are in the ASX 200 and 300 categories, and it's a space the firm is comfortable with. "We can certainly do most M&A transactions on a reasonable scale, but we don't have the capacity to advise on something like, for example, BHP's bid for Rio Tinto," Godding says.

There has been a suggestion of a 'flight to quality' from the mid-tier firms by clients, but it's not a theory Godding embraces. "We can't see it happening," he says. "The purpose of a mid-tier firm is to provide good value for money and accommodate client needs. Unless the transaction is particularly complex, we can't see clients taking that work elsewhere. Our hourly rates are significantly less and we're able to do the work, while providing partner contact and a practical solution."

Kennedy Strang

Kemp Strang is part of the Kennedy Strang Legal Group, an Australia-wide association of firms that also includes Melbourne's Russell Kennedy, Brisbane's Thynne & Macartney and Adelaide's Lynch Meyer. The Western Australian member of the group, Christensen Vaughan, recently left the alliance to join Gadens in Perth, leaving a vacancy which the group is looking to fill.

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