RGP buys German interim and project management firm taskforce
RGP has considerably expanded its presence in Germany with the acquisition of taskforce - Management on Demand for a fee of around €6 million. The move, which is part of a wider effort to bolster its European business, adds around 100 partners and associated managers to its German base, as well as a network of 800 interim managers.
Founded in 1996, RGP is a multinational management consulting firm that helps clients with matters across the business spectrum, spanning accounting; finance; governance; risk and compliance management; corporate advisory; strategic communications and restructuring; information management; human capital; supply chain management; and legal and regulatory.
In 2003 RGP, formerly Resource Global Professionals, first set foot on European ground with the opening of an office in the Netherlands, after the firm snapped up the Interim Management arm of Big Four firm EY. Today the consultancy has operations in twelve European countries, including Germany, where it has a core team of over 100 advisors and a network consisting of over 1,500 professionals. The German organisation, which is led by former Bain & Company and Roland Berger consultant Johan Werbrouck, operates from its base in Frankfurt, and has further satellite hubs in Düsseldorf and Munich.
Acquisition of taskforce
Earlier this month Werbrouck revealed that RGP has significantly strengthened its operations in the country with the addition of taskforce - Management on Demand to its footprint. Privately-owned taskforce was established in 2007 and has since grown into one of Germany’s leading providers of professional interim and project management. The company employs a team of more than 100 partners and associated managers, and can tap into a database that comprises over 800 managers with experience in nearly all segments and functional areas.
Besides adding depth and expertise to its operations in Germany, which is Europe’s second largest consulting market trailing just the UK, the move also enables the US headquartered consulting firm to provide more integrated solutions. In December 2015, when Werbrouck took the helm at RGP Germany, he said that the German consulting market was ripe for fundamental change, adding that he saw it as his task to prepare the firm for the ‘new normal’ in the landscape. One of his first moves was introducing a more flexible approach to consulting, which the firm dubs the ‘Hybrid Consulting Operating Model’. As part of the proposition, RGP offers its clients a mix of consultants, subject matter experts and interim managers, in a flexible and targeted manner, according to the Managing Director.
Building on the growing demand for external advisory in the Germany market, and the success of its offerings, RGP Germany has seen growth in the in between period – the acquisition of taskforce however lifts the firm’s operations in the country to an entire new level. “This is an exciting move for our growing European practice, as taskforce has a very strong brand in the German market. Together we will focus on continuing to build that brand, whilst leveraging our combined capabilities for our clients” said Mark Campbell, Senior Vice President of RGP in Europe.
Kate Duchene, President and CEO of RGP (based in the US), remarked “Based upon current economic forecasts, we believe there will be a growing need for services both in Germany and the rest of the European market of the type that RGP provides. The acquisition of taskforce significantly strengthens our presence in the German market and our ability to serve clients there and throughout the rest of Europe. In addition, both we and taskforce executives believe that the depth and breadth of capabilities RGP brings can and will deliver added value to taskforce clients.”
Asked about how RGP will ensure the blending of the two cultures goes according to plan – previous deals in the consulting arena show that cultural mismatch is a major risk for successful integration – Campbell stated, “RGP understands that successful acquisitions in professional services require a secure and shared culture. After many months getting to know each other, we are convinced that we have that shared culture.” RGP and taskforce have in fact known each other for years, collaborating on a “number of projects”, with the similarities in approach between the two convincing the firm’s leaders that an “acquisition was the right step for our clients and for our investors.”
The purchase price for taskforce has been set at an initial consideration of €6.0 million (approximately $7.1 million), paid through a combination of cash and restricted stock. In comparison, taskforce, which is based in Munich and has further offices in Düsseldorf and Münster, booked a revenue of approximately €12 million ($13.3 million) for the twelve months ended December 31, 2016.
Operate independently
Under the wings of RGP, taskforce will continue to operate under its existing brand name – the interim specialist will however add the tagline ‘An RGP company’ to its logo. Jens Christophers and Lennart Koch, two veteran partners at the firm, will remain joint CEOs, reporting to Campbell, and will serve as part of RGP’s leadership team in Europe. During the deal process, taskforce’s shareholders were supported by law firm DLA Piper, among others, with buy-side deal teams not disclosed by RGP.
For RGP, which globally has over 3,300 professionals across 67 offices, the transaction marks a departure from the by and large organic growth strategy which it has pursued in recent years. In 2009 the professional services firm purchased Sitrick & Company (a strategic communications firm) and Brincko Associates (a corporate advisory and restructuring firm) in the US, and later that year it also added Xperianz to its North American wing. In Europe RGP acquired Domenica in the Netherlands in 2008, while the year previous it bought UK based Compliance Consultants for approximately $8.2 million. Since, RGP has been relatively quiet at the M&A front, with the taskforce deal believed to mark the start of a wider expansion push on mainland Europe.
