For months now the UK media has been floating articles about private equity interest in Grant Thornton, starting (we think) with this July piece in The Times:
Grant Thornton UK has begun sounding out private equity firms over a potential deal that could see them buy into the business, which is jointly owned by more than 200 partners.
Grant Thornton UK, which employs more than 5,000 people, said it was not “actively engaged” in a transaction but that it “continually evaluates” the business landscape.
The firm is said to be working with advisers from Rothschild, which declined to comment.
Shortly after that, out came a story suggesting that Grant Thornton US was in the market to buy their Brit and Irish cousins across the pond. This is from “Grant Thornton explores three-way merger,” published by Financial Times in the latter half of July:
Under the three-way merger plan, the current partners of the UK and Irish firms would become shareholders in an international holding company led by Grant Thornton’s US private equity owners and partners. Relative valuations of the firms had yet to be discussed and the UK and Irish firms could decide to pursue different deals or none, according to people familiar with the matter.
The UK firm has already hired Rothschild to explore options for its business. Bankers have begun seeking expressions of interest from private equity firms that could provide an alternative to a merger with the US firm.
Our take on that: Grant Thornton Wants to Have a Threesome?
In the weeks and months that followed, several more stories came out about this alleged heated battle to buy (literally) Grant Thornton UK’s heart. We don’t need to link them all but here’s a recent one. Sky News put this out on October 15:
A trio of buyout firms have been shortlisted to buy a stake in the UK operations of Grant Thornton, one of Britain’s six biggest accountancy firms.
Sky News has learnt that Cinven, EQT and New Mountain Capital – the backer of Grant Thornton’s US business – have made the cut in a process that could value the UK firm at more than £1.5bn.
Other contenders, including Permira and Carlyle are said to no longer be in contention, although insiders cautioned that the list was subject to change.
Oh my God just sign something already. It sounds to us like someone or someones at Grant Thornton is/are desperately trying to seed rumors of a bidding war among private equity firms vying to be the lucky one to win a piece of Grant Thornton. No other firm has dragged out this song and dance, they do the thing and move on. Please try that, GT.
Related:
A new survey of more than 300 chief audit executives (CAEs) by Grant Thornton LLP finds that while nearly half believe that the shifting regulatory landscape poses the greatest threat to their company, a vast majority (88%) do not believe that the Sarbanes-Oxley Act (SOX) should be repealed. Of those that believe SOX should be repealed, the cost of compliance is the main reason for doing so. “Since the passage of SOX, organizations have had to dedicate significant resources to comply with a host of new laws and regulations,” noted Warren Stippich, a Chicago-based partner and Grant Thornton’s national Governance, Risk and Compliance solution leader. “Based on discussions with various CAEs during the survey process, many believe that SOX brings a continued focus by management on financial and governance-related controls. However, CAEs believe that compliance audit processes are now well-defined and are currently exploring ways to contribute value creation to the organization well beyond compliance monitoring and reporting.” [
The hold up probably has to do with how bad the US performance has been since they did a deal. Partners stopped working and the random layoffs have most people looking for a new employer.