Personal injury specialists Claims Direct this week revealed plans for a £280m floatation on the London Stock Exchange in a bid to capitalise on the widening net of "no-win no-fee" litigation.

The company expects to raise between £50m and £100m from the floatation with half of the extra funds earmarked to fuel expansion plans.

During the year to March 31, the personal injury specialist turned an £870,000 loss into a £10m pre-tax profit.

And its turnover grew nearly six-fold from £7m in March 1999 to £40m in the last results.

Executive chairman, Tony Sullman said: "Our flotation is an important step in the development of the group that will create greater visibility and transparency.

"The floatation will allow the group to fund its current operations more efficiently, expand into complementary business areas and make strategic acquisitions and investments."

Claims Direct, which was first set up in 1995, has evolved hand-in-hand with the fast-paced reforms to the legal system.

Its spectacular growth last year followed the Government's decision to sweep away much of legal aid and introduce no-win no-fee for personal injury litigation in the Access to Justice Act.

This has been subsequently extended to all civil money and damages claims as well.

Claims Direct targets victims of workplace, car, and slip and trip accidents who cannot afford to pay high legal bills.

Under the Claims Direct proposal, people who are assessed as having a better than 50% chance of winning their cases pay £1,333 for legal costs insurance.

To pay the required premiums, Claims Direct has negotiated a loan deal with First National Bank.

Where cases are won, the £1,333 fee is reclaimed from the other party. Where the case is lost it is Claims Direct ultimately that pays the bill.

Claims Direct is currently progressing around 40,000 claims, while more than 10,000 people have already received compensation under the scheme.