EY-Parthenon expands in Australia with Port Jackson deal

08 May 2020 Consultancy.uk 5 min. read
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A strategy consulting firm based in Australia has become the latest firm to be added to EY’s growing EY-Parthenon brand. Port Jackson Partners will join forces with the Big Four firm’s strategy arm in a move designed to help deliver strategic insights and a more end-to-end service offering to clients.

Australia’s strategy consulting market is estimated to account for roughly 15% of Australia’s $6 billion consulting industry. As with the rest of the world, the leaders in the space remain the MBB: McKinsey & Company has around 500 staff nationally, Boston Consulting Group around 450, while Bain & Company has around 250.

Other large strategic consultancies with a presence in Australia include Oliver Wyman, L.E.K. Consulting, Monitor Deloitte (Deloitte’s strategy arm built on the Monitor Group deal) and Strategy& (PwC’s strategy arm formed after it purchased Booz & Company). Looking to catch these competitors, with a team of nearly 100 partners and consultants, EY-Parthenon has significantly beefed up its market share in recent years.

EY-Parthenon expands in Australia with Port Jackson deal

After seeing Roland Berger narrowly failed to clinch a deal for the Parthenon Group back in 2013, EY swooped for the mid-sized North American strategy consulting firm a year later. After the purchase, The Parthenon Group was rebranded as EY-Parthenon.

Since then, EY-Parthenon has seen strong growth globally, on the back of organic growth and an aggressive merger & acquisition campaign, particularly in Europe. Between 2016 and 2018, EY-Parthenon bought the entire operations of OC&C Strategy Consultants (a UK-headquartered international strategy consulting firm) in the Benelux, France and Germany.

Now, EY-Parthenon has sealed a deal to purchase Australian strategy consulting firm Port Jackson Partners, taking EY-Parthenon’s national headcount to around 5,000 partners and staff. The firm works from offices around the world, including three in Australia; in Brisbane, Melbourne and Sydney.

According to Port Jackson Managing Partner Byron Pirola, the deal comes after the firm snubbed offers from two other major consulting firms. Pirola has been with Port Jackson Partners since 1991, and said the choice to join EY hinged on several factors, including its international client base and the fact over the course of its acquisition drive, the EY-Parthenon brand has become a “distinct tier 1 strategy advisory house.”

On the benefit of the joining forces, Pirola told the Australian Financial Review, “It will help us provide additional value to our clients in the boardroom and at the C-Suite level by providing even greater strategic insights, along with the end-to-end services already offered by EY.”

The integration sees the full team of Port Jackson Partners – 13 partners and 40 consultants and staff – join EY. The team will remain operationally separate for the foreseeable future, but will work closely together with the existing EY-Parthenon team division comprising five partners and some 30 consultants. Port Jackson Partners will rebrand as EY Port Jackson Partners, and Pirola will stay at the helm.

It also secures a valuable line of business for EY amid the uncertainty of the coronavirus. The nearly $2 billion Big Four firm is feeling the impact of the covid-19 induced downturn, and has had to slash the hours and pay of some staff by 20% to offset declining fee income. Its fortunes stand in stark contrast to Port Jackson Partners, which Pirola confirmed to the AFR is “as busy as it ever has been” – the consultancy last year generated to the tune of $24 million in revenue and an after-tax profit of $5.2 million.