KPMG picks up insolvency and forensics specialist Ferrier Hodgson
KPMG has added leading insolvency specialist Ferrier Hodgson – creating one of the largest turnaround teams in Australia.
Big Four professional services firm KPMG has finalised a deal with Sydney-headquartered corporate turnaround and insolvency management specialists Ferrier Hodgson after months of negotiation, with the talks first reported by the Australian financial Review last November. The deal includes the Sydney, Melbourne, Brisbane and Perth offices of Ferrier Hodgson, with talks on acquiring its Adelaide affiliate also well advanced.
Established in in 1976, the more than 40-year old firm has since become one of Australia’s largest independent insolvency and turnaround advisors, with additional offices in Singapore and Malaysia and further lines in forensic accounting, technology and forensics IT, management consulting and transactions advisory deliver by a team of more than 300. Twenty of the firm’s partners will now join KPMG, including managing partner James Stewart.
“We are excited about the opportunity to merge with KPMG,” said Stewart, who has been with Ferrier Hodgson for over three decades. “We believe our clients will benefit from the greater breadth of solutions available to them, and our shared values and cultural fit will ensure a smooth integration into KPMG for our people. Strategically, the merger gives our team immediate access to a diverse range of skill-sets to better engineer operational turnaround and add a lot more value to clients.”
Stewart will head up the combined unit at KPMG, together with KPMG’s national Restructuring Services leader and recently elected WA Chairman Matthew Woods. Altogether, the practice will have a 200-strong headcount, including 27 partners in total – creating one of the largest and most experienced insolvency and turnaround practices in Australia when the merger is completed in June as expected. Financial details of the deal haven’t been disclosed, but Ferrier Hodgson is believed to generate revenues around the $100 million mark.
“The rationale for a merger was compelling, with KPMG and Ferrier Hodgson a great fit strategically and culturally,” said KPMG Australia’s CEO Gary Wingrove, who helms the second-fastest growing Big Four firm in the country. “The combination of our operations with Ferrier Hodgson will immediately and significantly strengthen the breadth and level of service we can offer our clients in the restructuring and forensic advisory sphere.”
Wingrove continued: Traditionally, KPMG has always focused on the turnaround and restructuring side of the practice, which has enjoyed sound growth year on year for the past five years. But we haven’t had the capacity to meet the market opportunity – until now. This merger builds great scale and capability, quickly, making us a highly competitive force… The Ferrier Hodgson team is very experienced, with a great reputation, and we are delighted to be welcoming them to the firm.”
The deal follows rival PwC’s move in the middle of last year to bring in 22 partners and most of the staff from PPB, another previously independent player in the restructuring and forensics space – along with PPB’s management consulting arm the Litmus Group – for the reportedly paltry sum of just $90 million combined. The Australian Financial Reviewed also previously reported that at least one of the other Big Four firms had been in the hunt for Ferrier Hodgson.
