Grant Thornton Ireland and US Firms to Merge in Strategic Alliance Backed by Private Equity

In a significant development for the professional services industry, Grant Thornton Ireland and Grant Thornton US have announced the merger of their advisory and tax businesses. This strategic partnership is supported by New Mountain Capital, a prominent New York-based private equity firm. The merger marks a pivotal step towards creating a more globally integrated advisory firm with a wide international reach and enhanced expertise.

While Grant Thornton Ireland’s advisory and tax divisions will merge with their US counterparts, the Irish firm’s audit practice will remain independent, continuing to operate under an alternative practice structure. The merger partners confirmed this arrangement in a joint statement issued on Thursday.

Grant Thornton Ireland, which employs approximately 2,800 staff, including 72 partners, will hold a 12% stake in the combined entity. The firm’s audit business alone employs around 1,000 staff. Last year, the Irish firm generated revenues of €300 million, making it the fifth-largest contributor to the global Grant Thornton network. In contrast, Grant Thornton US is the largest, with annual fees of $2.4 billion (€2.2 billion).

Steve Tennant, CEO of Grant Thornton Ireland, emphasized the significance of the merger, stating, “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.” He added that the merger positions the firm to accelerate growth and provide impactful solutions for clients in a dynamic global landscape.

The decision to merge follows a period of strategic planning for the Irish firm, which had enlisted Deutsche Bank’s expertise earlier this year after receiving interest from several private equity firms. The professional services sector has become a hotspot for private equity investment, with firms like Grant Thornton being courted for strategic tie-ups.

Though there were earlier reports of a potential three-way merger involving the US, UK, and Irish firms within the Grant Thornton network, it appears that Grant Thornton UK is currently exploring private equity opportunities separately, reportedly in discussions with Cinven, EQT, and New Mountain Capital.

As part of the merger, fresh capital will be injected into Grant Thornton Ireland’s advisory and tax divisions by Grant Thornton Advisors in the US. The US firm had sold a 60% stake in itself to New Mountain Capital for $1.4 billion earlier this year. Although financial details of the Irish transaction were not disclosed, sources suggest that this deal will infuse new capital to fuel the firm’s future growth.

Upon completion of the merger, which is expected in the first quarter of next year, subject to regulatory approval, the combined entity will continue to offer a full suite of advisory and tax services across all regions where the firms currently operate. Steve Tennant will assume the role of president of Grant Thornton Ireland and will join the executive committee of Grant Thornton Advisors, while Seth Siegel, CEO of Grant Thornton Advisors, will lead the combined business.

The Grant Thornton global network spans more than 149 countries, employing over 73,000 people. Industry experts believe that this merger will likely serve as a model for future consolidations within the network, further enhancing the firm’s global presence and capabilities.

Andre Moura, managing director at New Mountain Capital, expressed enthusiasm for the partnership, noting, “This is an exciting step forward in our growth strategy that enhances the Grant Thornton brand and international capabilities.”

As the firms move towards finalizing the deal, the merger represents a significant evolution in professional services, combining the strengths of two major players to better serve a rapidly changing global marketplace.

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