Grant Thornton Ireland and Grant Thornton US are to merge their advisory and tax businesses, in a deal backed by New York private equity firm New Mountain Capital.
Grant Thornton Ireland’s audit business, with about 1,000 staff, will continue as an independent partnership and operate under an alternative practice structure, the merger partners said in a joint statement on Thursday.
The Irish business has a total of about 2,800 staff, including 72 partners. It will make up about a 12 per cent stake in the combined entity.
The Irish firm, which generated about €300 million of revenues last year, is the fifth-largest part of the global Grant Thornton network. The US firm is the largest, with its latest reported annual fees amounting to $2.4 billion (€2.2 billion).
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“This transformational partnership will enhance our appeal to a much broader international client base, as the first truly integrated US and Irish professional services firm, combining the expertise and reach of both firms,” said Steve Tennant, chief executive of Grant Thornton Ireland.
“This is a key moment in shaping the future of professional services in a rapidly evolving global landscape, and we are looking forward to partnering together to accelerate growth and deliver impactful benefits for our people and clients across diverse industries and geographies.”
The Irish firm had hired Deutsche Bank earlier this year to advise on its future strategy, after fielding numerous approaches from private equity firms that are swarming the sector globally, sources previously said.
It was reported in July that the US, UK and Irish firms in the Grant Thornton network were considering a three-way tie-up. However, Grant Thornton UK is currently said to be courting three private equity firms, Cinven, EQT and New Mountain Capital.
The deal is being structured in a way that Grant Thornton Advisors in the US, which sold a 60 per cent stake in itself earlier this year to New Mountain for a reported $1.4 billion, is injecting fresh capital into the Irish advisory and tax firm, according to sources. They declined to give financial details.
Sources also declined to say whether the Irish partners will be taking some money off the table as part of the transaction.
Upon closing, which is expected in the first quarter of next year subject to regulatory approval, Grant Thornton Advisors and Grant Thornton Ireland will continue to offer clients a full complement of advisory and tax solutions, the firms said.
The independent Grant Thornton Ireland audit business will continue to provide assurance services.
The combined business, which will be led by Grant Thornton Advisors’ chief executive, Seth Siegel, will go to market together in all of the territories where each firm currently has a presence. Mr Tennant will assume the role of president of Grant Thornton Ireland and will become a member of Grant Thornton Advisors’ executive committee.
The Grant Thornton global network has more than 73,000 people in firms across more than 149 countries.
Industry observers say the deal between the US and Irish firms will likely form a template for further tie-ups within the network.
“New Mountain Capital is proud to support the coming together of Grant Thornton in the US and Ireland. This is an exciting step forward in our growth strategy that enhances the Grant Thornton brand and international capabilities,” said Andre Moura, managing director at New Mountain Capital.
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