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Grant Thornton UK, the nation’s sixth largest accounting agency by income, has agreed to promote a stake to the buyout group Cinven, marking probably the most important personal fairness funding so far within the UK accounting sector.
Cinven beat rival presents from different personal fairness teams together with Sweden’s EQT, and from Grant Thornton’s sister agency within the US, which had proposed a transatlantic merger.
The scale of the stake and the worth that Cinven has agreed to pay couldn’t instantly be discovered. Grant Thornton UK had engaged bankers at Rothschild to run an auction that companions hoped would worth the agency at about £1.5bn and one individual acquainted with the bidding mentioned that it had earlier reached about £1.3bn.
Monetary consumers have been extending their affect in a occupation that has traditionally most well-liked to function as personal partnerships. Earlier this week, two top 30 US accountancy corporations introduced the sale of majority stakes to personal fairness.
Accounting corporations have been increasing bolt-on companies similar to monetary and expertise consulting lately, and personal fairness has offered capital to speed up investments in IT and merger and acquisitions exercise, in addition to offering a windfall for present companions.
Grant Thornton US is the biggest American accountancy agency to have bought a majority stake to personal fairness, and its proprietor New Mountain Capital has set its sights on worldwide growth. Final month, it inked a deal to accumulate Grant Thornton Eire and had hoped to finish a three-way merger.
Nonetheless, the leaders of the UK sister agency determined they most well-liked to stay unbiased somewhat than fold the enterprise into the US operation, in line with individuals acquainted with their pondering.
Grant Thornton UK mentioned: “Having evaluated the exterior panorama, we’ve agreed preliminary phrases with an investor, who we really feel is finest positioned to assist our accelerated progress within the medium time period.
“The phrases of any transaction stay confidential and are topic to ratification by the partnership and regulatory approval.”
Grant Thornton UK reported revenues of £654mn final 12 months, a 7 per cent improve on the earlier 12 months, and an 18 per cent improve in working revenue to £146mn.
The improved monetary outcomes got here regardless of transferring away from auditing so-called “public curiosity entities” similar to listed corporations, banks and insurers, which might be profitable however entice the very best stage of regulatory scrutiny.
Grant Thornton was demoted final 12 months from the UK accounting watchdog’s prime tier of audit supervision.
Cinven owns different monetary companies teams together with Alter Domus, a fund administration group it acquired this 12 months, and German life insurance coverage consolidator Viridium.
Cinven declined to remark.
