Deloitte appointed as lead advisor for Hyundai A-League two club expansion

23 May 2018 Consultancy.com.au

Football Federation Australia is gearing up for its 2018-19 expansion which will see two new teams enter the A-League. Applications are currently open and the FFA is hoping to draw investors from Europe, North America and Asia. The FFA board will make a decision on the applications in October this year.

Big Four professional services firm Deloitte will advise Football Federation Australia on the expressions of interest and oversee the league expansion. Deloitte will be involved in mediation between the bidders and the FFA whilst providing information to applicants, managing questions, facilitating meetings and conducting due diligence on proposals received.

There have been 10 applications for the spots so far, with more considered to be still in the pipeline. Whilst it is unknown where the new clubs will be based, according to SBS’s The World Game; Melbourne, Sydney and Brisbane are all likely contenders. 

The A-League currently has 10 teams since the Western Sydney Wanderers joined the league in 2012. There are currently two teams each from Melbourne (Melbourne City FC and Melbourne Victory) and Sydney (Sydney FC & Western Sydney Wanderers) whilst Brisbane Roar FC are the only ones to call the Queensland capital home. The two new clubs will be a part of the 2019-20 A-League season.

FFA chief executive David Gallop commented in relation to the expansion, “we can already see that there is genuine interest in the market, encouraged by the recent sale of Adelaide United which demonstrated that A-League club licences have grown significantly in value over time.”

Deloitte appointed as lead advisor for Hyundai A-League two club expansion

“With Asia Pacific the fastest growing economy in the world we’re delighted to be assisting FFA with this process to expand the league and continue to grow “the World Game” Down Under. We have done a lot of work on the fundamentals behind successful expansion of the A-League and we are confident that we will receive some high quality bids as part of this process.”

"But it's important to remember that this is an interaction with the market and the market will have its own views. We must do all we can to ensure that sound business principles and more generally the best interests of football are considered and applied.”

Deloitte is a market leader for professional services in sport through its specialist subsidiary, Sports Business Group – a network of strategic consultants who provide commercial, financial, regulatory, taxation and general business knowledge to assist their clients globally.

“Deloitte have considerable expertise in this area and specific expertise through their Manchester office in football investment which is why we have engaged them. We will ensure that all potential investors are aware of the process,” said Gallop.

Deloitte Partner Aaron Black commented on the firm being chosen for the job, “Deloitte has a long standing history and a global pedigree advising local and international sports on their most strategic opportunities.”

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Commonwealth Bank working with McKinsey on massive job cuts

16 April 2019 Consultancy.com.au

The Commonwealth Bank could be set to cut up to 10,000 jobs and around $2 billion in costs according to reports, with the bank working on the plan with McKinsey.

Driven by new CEO Matt Comyn, who was appointed to the helm last year, the Commonwealth Bank of Australia (CBA) is said to be mulling a plan devised in conjunction with global strategy and management firm McKinsey & Company to axe up to 10,000 local jobs – saving about $2 billion in operating costs. It continues the close relationship between the bank and the consultancy dating back for more than 15 years.

The largest employer among Australia’s Big Four banks, the potential cuts could see an almost 25 percent reduction to its approximate workforce of 44,000, the CBA’s headcount then dropping below the ~34,000-strong staff at National Bank. The plan is also reported to include the shuttering of 300 of its 1000 branches around the country, although as customers shift to online banking the closures are not unexpected.

“My understanding is that the story is good and there has been a plan underway,” said Your Money’s chief reporter Leo Shanahan of the reports which first surfaced in The Australian (Your Money was formed through a partnership between Nine and NewsCorp subsidiary Australia News Channel). With its potential ramifications for the government’s hopes in the upcoming federal election, the reporting from Murdoch’s stable provides an unexpected twist.

“Matt Comyn has been wanting to shut branches in particular for a while and cut costs at the bank. There is broadly a plan underway over the next few years for [this cost-cutting] to happen,” continued Shanahan on Comyn, who replaced former McKinsey New Zealand head and global partner Ian Narev as CEO last year following the anti-money laundering breeches which saw the bank fined a record $700 million.Commonwealth Bank working with McKinsey on massive job cutsComyn has since broadly criticised his predecessor at the recent Royal Commission into misconduct in the banking and financial services sector, which stemmed in part from a Four Corners report on the profit-at-all-costs culture within the CBA’s financial planning division, but the bank’s relationship with McKinsey apparently remains strong – having dated back to before Narev’s arrival and featuring other close links.

In 2003, the CBA brought in McKinsey for an ongoing “benchmarking” project to cut $500 million in costs – with 600 staff said to be in the retrenchment cross-hairs at the time following a significant reduction in the years prior. McKinsey has continued to serve the CBA in the years following, and had throughout the 80s and 90s advised all of the NAB, Westpac and the ANZ on various cost-cutting and re-organisational measures – including saving Westpac from potential collapse.

Meanwhile, CBA’s Group Executive for Retail Banking Angus Sullivan, who will be responsible for overseeing any strategy to close branches and let go customer facing staff, was like Narev a former partner in McKinsey’s New York office, spending nine years with the strategy firm before joining CBA in 2011. Former CFO Rob Jesudason is also among others a McKinsey alumnus, while the leadership team of the CBA’s strategy division continues to feature a number of ex-McKinsey consultants.

For the Commonwealth Bank’s part, it has described the reports of a mass redundancy – which The Australian contends were meant to be kept secret until after the election – as “unnecessarily alarming” and “misleading”, while reiterating the need to manage costs. McKinsey meanwhile traditionally refuses to comment on matters concerning its clients, although the firm recently committed to greater transparency following a series of its own public image issues.

The financial sector accounts for nearly a quarter of Australia’s $5 billion management consulting spend, with the Big Four professional services quartet Deloitte, PwC, KPMG and EY in recent years all scoring multi-million dollar contracts with the big Australian banks – particularly around the areas of digitisation. McKinsey, meanwhile, was last year brought in by Telstra on another $1 billion cost-cutting program.