Rumor Has It Something’s Going Down at Marcum (UPDATE)
In November Financial Times wrote a quick little story about accounting firms eyeing private equity deals, a topic that first gained visibility when TowerBrook Capital Partners purchased an ownership stake in EisnerAmper way back in 2021. The FT story listed BDO, Grant Thornton, and Marcum as firms that have explored these deals, though none of […]
WeiserMazars Moves into Chicago as Part of Acquisition of LECG Units
Earlier this week, we told you about the fire sale that was going down at LECG Corp. LECG was selling off various units to FTI Consulting, Grant Thornton and WeiserMazars to try and pay down a portion of the $27 or so million that they owed on their credit facility. After speaking with Doug Phillips, the managing partner at WeiserMazars, we have learned that the deal has officially closed and few more details about the units they acquired in the deal, including their move into the Chicago market.
As we reported on Monday, WM is picking up five partners and approximately 40 staff from LECG. Mr Phillips told us that “we are very excited” about the transaction and these professionals will join the commercial and insurance audit practices as well as business advisory services. The majority of the new professionals will be located in the firm’s Horsham, PA location while one partner and approximately ten staff will be located in Chicago.
Mr Phillips told GC that this acquisition strengthens WeiserMazars’s “insurance, commercial and business advisory services, as well as solidifies our presence in the Philadelphia market.” Perhaps more importantly, however, is that “[WeiserMazars] now has a presence in the Chicago marketplace,” Mr Phillips aid. This will mark the 9th location for the firm in a key market for a firm that appears to have some wind in its sails after last year’s combination of Weiser and Mazars. We’ll be keeping an eye on them as things progress after this latest move.
UPDATE:
Check out the WeiserMazars press release for more details.
Grant Thornton Is Done Selling: Acquires Huron’s Disputes & Investigations Practice
If you had to judge the state of Grant Thornton based on the activity over the past year, you might assume that the firm was headed downhill because of their disposal of several offices around the country. Despite the haters and accent conspiracy theorists out there, Stephen Chipman was confident about the future. So much so that he sent hand-written notes to all of you encouraging you to become GT evangelists.
Now this morning, we learn that this unleashing of dynamic potential clients could be taking shape:
Grant Thornton LLP said Monday it has acquired the assets of Huron Consulting Group’s disputes and investigations practice in a deal that will bring 60 people to Grant Thornton’s offices in Boston, Chicago, New York and San Francisco.
The acquisition is part of Grant Thornton’s strategy to double revenue in the next five years. Huron Consulting has divested itself of its disputes and investigations practice. Huron’s D&I employees will join Grant Thornton’s economic and advisory groups in four cities, including Boston.
Well! This is quite the acquisition. Since GT and Huron are both Chicago-based, there is likely a lot of connections here that helped make this deal happen. Huron’s press release states that the D&I group (the smallest inside the company) had been on the block because the overlords wanted to focus its efforts on “businesses [with] a more substantial market presence”:
The Company stated previously that it was evaluating the long-term prospects of its D&I service line, which had accounted for approximately 5% of the Company’s overall revenue for the first six months of 2010. “The Disputes and Investigations practice has been a part of Huron since our formation in 2002. We recently conducted a comprehensive assessment of all of our businesses and concluded that the divestiture of the D&I practice would enable management to devote more of its energies and financial resources to businesses where we have a more substantial market presence,” said James H. Roth, chief executive officer, Huron Consulting Group.
[…]
Huron is also revising its 2010 revenue guidance based on the divestiture of the D&I practice and other market factors impacting two reporting segments. When the Company announced second quarter results in July 2010, it provided a 2010 revenue guidance estimate between $600-$620 million.
Based on the divestiture of the D&I practice, the 2010 Company revenue guidance would have been reduced by $35-$40 million. In addition to the D&I divestiture impact, the Company is reducing its annual guidance by an additional $25-$30 million to reflect contract and project delays in two of its service lines: Healthcare and Accounting Advisory.
On the surface, it may look like a good deal for both companies but in reality it feels like Huron was desperate to sell a good revenue-generating unit (19% as of June 30, 2010) and since GT is definitely shopping for acquisitions, the firm was more than happy to take it off their hands.
This acquisition will allow GT access to a sexy area of advisory work (D&I consists of “business disputes, forensic accounting and investigative services, tax controversies and intellectual property disputes”) in key markets and presumably, they can hype the new group internally to expand it and compete for more business.
The only possible downside is that some inside GT may be concerned (we’re speculating here) about taking on more Andersen refugees but ultimately it looks like a good move and the first example of the firm making good on its new strategy. If you’ve got a different opinion, chime in below.
Grant Thornton buys Huron operation [Boston Business Journal]
Huron Consulting Group Announces Divestiture of Disputes & Investigations Practice to Continue Focus on Core Businesses [EON]