In late March it was announced that Deloitte Consulting was close to an acquisition of Roland Berger. According to the latest reports, the transaction may, just as it did two years ago, end up with an unexpected twist. In November 2010 a deal between Deloitte and Roland Berger was called off at the last moment and now it seems as if PwC has overtaken Deloitte as the firm with the best papers to buy the global strategy consultant. This says the British newspaper The Financial Times based on sources involved in the acquisition. However, German media hint at the opposite direction, suggesting that Roland Berger Strategy Consultants is looking at all kinds of manners to remain independent.
The Financial Times states that two high ranked managers close to the situation said that PwC, the world's biggest business services provider in terms of revenue, and the German strategy consulting firm are in "close negotiations". The news is not entirely new - in early April Consultancy.uk wrote all about the fact that Ernst & Young, KPMG, Deloitte and PwC had shown interest at Roland Berger. Main difference is that E&Y and KPMG seem to have dropped off leaving Deloitte and PwC in the hotseat. PwC said it had a policy of not commenting on "rumours and speculation". Roland Berger also declined to comment.
Focus on advice
PwC's interest in boosting its presence in the consulting sector is in line with a clear trend visible in the market for consulting services. Under the influence of tariff pressure the revenue in controlling is slowly declining.
Moreover, scandals in the controlling branch of the industry are a constant source for reputation damage. The growth for the major business is in the consulting, with the result that large accountancy and consultancy firms try to acquire consulting firms or a team of consultants with some regularity.
Recent examples include the acquisition of Partake Consulting by Ernst & Young, the purchase of healthcare consulting firms Plexus and EquaTerra by KPMG and the merger between ConQuaestor and Grant Thornton. PwC recently acquired Proxyon and True Economy Consulting.
Earlier this century, parts of the consulting division were laid off by the big firms. That was in the wake of accounting scandals like Enron and Parmelat. This made the combination of consulting and auditing the same client suspicious. Deloitte was the exception, with the result that the Big4 firm in still ahead of competitors in consulting.