Consortium completes $4 billion Duff & Phelps acquisition
A global investor consortium led by funds managed by Stone Point Capital and Further Global has completed its acquisition of specialist corporate recovery consultancy Duff & Phelps. Following the deal, the Duff & Phelps management team will maintain a meaningful equity stake in the firm, and lead the company as it experiences keen demand – particularly for its restructuring services.
As the Covid-19 pandemic continues to push the global economy to the brink of a recession, there are few safe bets left for investors to make. One of the few things private equity can be sure of, however, is that consulting firms which specialise in insolvency and corporate recovery for ailing businesses are set to enjoy a spike in demand throughout 2020.
While M&A in the consulting industry seems to be lower than usual, then, it might not be especially surprising to find that an acquisition of Duff & Phelps has just concluded. Duff & Phelps has over 4,000 employees, and advises clients in the areas of valuation, corporate finance, disputes and investigations, cyber security, claims administration and regulatory issues – but is arguably best known for its work in administration processes.
The transaction, funded by a consortium of investors led by Stone Point Capital and Further Global, has been valued at $4.2 billion. As part of the acquisition, the Permira funds group, which previously held a majority stake in Duff & Phelps, continues to hold a significant stake in the company as part of the consortium. Meanwhile, the Duff & Phelps management team will retain an equity stake in the firm, and maintain leadership of the company.
Noah Gottdiener, Chief Executive Officer of Duff & Phelps, commented, “This marks an exciting next chapter for Duff & Phelps and underscores the versatility and resilience of our business in any economic environment. I am grateful to Stone Point Capital, Further Global, Permira and the full investor consortium for their confidence in Duff & Phelps and our ability to continue our growth trajectory. I also thank the Duff & Phelps colleagues who have worked so hard to help us achieve this milestone, as well as our clients who trust us every day to help address their most pressing challenges.”
Chuck Davis, Chief Executive Officer of Stone Point Capital, added, “Duff & Phelps has a strong future ahead and we are thrilled to reunite with Noah, Jake and their outstanding team as they continue to deliver best-in-class services to their clients. The Permira team have been great partners to the company and we are delighted that they are continuing their partnership.”
It would be wrong to state that this is just about restructuring. The investors hope their move will pay dividends well beyond the current pandemic and ensuing financial crisis, as Duff & Phelps and serves more than 50% of the S&P 500, 60% of the Fortune 100, 80% of the Am Law 100 in an advisory capacity, as well as 70% of the world’s top-tier hedge and private equity funds. This means it is ideally positioned to make the most of the post-coronavirus recovery period too.
