Australian firm Slater & Gordon has become the first law firm in the world to float on a public market after it made its debut on the Australian Stock Exchange on Monday (21 May).

The initial public offering (IPO), which is being watched closely by the UK's legal community, comes in the wake of recent changes to Australian law allowing non-lawyers to invest in law firms.

Slater, which specialises in personal injury litigation work, will have a market capitalisation of around A$107m (£45m).

The 87-lawyer firm was initially looking to raise A$35m (£15m) through the flotation. Early indications are that the 35 million shares issued were well-received by investors after the share value surged 40% from A$1 (42p) to U$1.40 (58p) on its first day of trading.

The firm's seven vendor shareholders are understood to have become millionaires following today's IPO. They include managing director Andrew Grech, deputy chair Peter Gordon and principal lawyer Paul Henderson.

Commenting last month on the move, Grech said: "We have been able to grow and diversify the business over the last few years with relatively limited resources. The access to capital as a listed company will enable us to continue and accelerate that process."

News of the world's first legal practice to float will have far-reaching implications for lawyers around the world and is likely to be particularly closely-watched by the UK's legal community as it gears up for similar reforms under the Legal Services Bill.

The Bill promises to usher in a raft of sweeping reforms, including allowing outside investment in law firms and encouraging firms to go public.

Professional services giant Deloitte & Touche is anticipating that a number of mid-tier UK firms will opt to list on the Alternative Investment Market in a bid to open up a new source of revenue.

According to Deloitte research published this month, the changes could also prove to be an attractive recruitment tool, allowing a firm to offer share option schemes and enhanced employment opportunities to its non-legal staff.

Commenting on the changes, Addleshaw Goddard partnership law specialist Richard Linsell said: "There is a lot of evidence to suggest that the corporate finance world is interested in getting its hands on professional services assets and the potential is definitely there for some fairly sizable law firms to float."

Linsell added: "It will be really interesting if a firm that has a turnover of around £70m wants to float – the market is unlikely to be interested in a law firm IPO unless the market capitalization is at least £100m – so we could see a number of mergers as firms try to reach that size."