Unlock the Editor’s Digest at no cost
A number of non-public fairness corporations are contemplating affords for a stake in Grant Thornton’s UK enterprise, in a aggressive bidding course of aimed toward securing a valuation of as much as £1.5bn for the mid-tier accountant.
Carlyle, Blackstone, Permira, CVC Capital Companions and Bridgepoint are amongst buyout corporations weighing potential affords for Grant Thornton UK forward of a deadline in September for formal expressions of curiosity, in line with individuals conversant in the scenario.
London-based Cinven can also be seen as a possible bidder by business executives, whereas New Mountain Capital, which took a majority stake in Grant Thornton’s US enterprise earlier this 12 months, is exploring a suggestion as a part of a plan to merge the UK, Eire and US operations, the Monetary Occasions has reported.
The method, which is being run by Rothschild, is anticipated to worth Grant Thornton UK between £1bn and £1.5bn.
A transaction could be “fairly an essential milestone as a result of within the UK, in that space of the market which is the big, enterprise shoppers, there hasn’t been a deal but”, stated Richard Holden, head of enterprise providers at funding financial institution Alantra.
Individuals near the matter stated that curiosity was at an early stage and there was no assure of formal affords. New York-based KKR will not be anticipated to make a bid, one particular person near the agency stated.
Grant Thornton additionally shut down hypothesis that it will take into account a deal excluding its audit observe, with one particular person near the accountant saying the thought was “full nonsense”. A spokesperson added: “We’re dedicated to remaining as a multidisciplinary agency.”
UK rules require audit corporations to be majority owned by educated accountants, which means that any non-public fairness deal could be prone to contain ringfencing Grant Thornton’s audit observe.
The agency has in recent times moved away from auditing so-called “public curiosity entities”, reminiscent of listed teams, banks and insurers that contain the best stage of regulatory scrutiny. Consequently, Grant Thornton was demoted final 12 months from the UK accounting watchdog’s high tier of audit supervision.
Non-public fairness involvement within the UK accounting sector is much less in depth than within the US, the place home accounting corporations are bigger. However such curiosity has been gathering tempo in Britain, particularly amongst smaller corporations.
Holden stated accounting teams had been turning to personal fairness companions for assist in investing in know-how and navigating succession planning.
Among the potential bidders for Grant Thornton have a historical past of investing in skilled providers corporations, together with CVC, which owns Teneo and bolted on Deloitte’s former restructuring unit to the enterprise in 2021.
Grant Thornton UK reported revenues of £654mn and an working revenue of £146mn final 12 months. The agency is led by Malcolm Gomersall, who took over in January following the departure of his predecessor David Dunckley.
Carlyle, CVC Capital Companions, Bridgepoint, Blackstone, Permira, Cinven and Rothschild declined to remark.
Grant Thornton stated it all the time explored “avenues that can drive development for our agency . . . we won’t be commenting additional on this matter”.