Major accountancy and advisory groups are always nice clients for law firms to have so Davis Polk & Wardwell, Cleary Gottlieb Steen & Hamilton and Linklaters have some cause for cheer after having been instructed on one of the biggest deals in the professional services sphere for years.
The deal sees big four accountancy and advisory group PricewaterhouseCoopers (PwC) seal an acquisition of New York-based Booz & Company, one of the proudest names in strategic consulting.
The deal will go to a vote of Booz’s 300 partners in December, bringing in a business with 3,000 staff and revenues of around $1bn. PwC, which currently generates revenues of $32bn, has been moving in recent years to expand its business in the lucrative strategic consultancy area.
Booz, which was founded in 1914, was a pioneer in the managing consulting business. The tie-up of two of the oldest names in professional services is likely to attract scrutiny from regulators, with audit watchdogs currently putting pressure on groups like PwC to avoid conflicts of interest.
Davis Polk was instructed as lead counsel for PwC, with the Wall Street leader fielding a team under global co-head of M&A David Caplan and corporate partner Oliver Smith. Other senior lawyers on the team included executive compensation partner Edmond Fitzgerald, tax partner Rachel Kleinberg and antitrust specialist Ronan Harty.
Caplan had previously advised PwC on its 2011 acquisition of management consulting firm PRTM for an undisclosed sum, as well as its buyout of Diamond Management & Technology Consultants for $378m in 2010.
Linklaters was also instructed on the deal, fielding a UK law team out of London led by corporate partners Richard Godden and Sarah Wiggins. Linklaters is a regular adviser to PwC in Europe, including acting for PwC on its lucrative role as the administrator in the European bankruptcy of Lehman Brothers.
Cleary Gottlieb is advising Booz with lawyers on the PwC deal including New York-based M&A partners Christopher Austin and Benet O’Reilly, employment partner Arthur Kohn, tax partner Sheldon Alster and antitrust specialist Brian Byrne in Washington DC.
Meanwhile, in a separate development, PwC today (31 October) announced a re-shuffle of the management of its PwC Legal network. Leon Flavell will now focus on his role as leader of PwC’s Global Legal Services Network. Shirley Brookes, currently managing partner of PwC Legal, is assuming Flavell’s role as PwC Legal’s UK senior partner.
The move will be watched closely at a time when many observers expect big four accountants to show renewed interest in the liberalising UK legal services market. Flavell commented: ‘We have the most geographically extensive legal services network in the world, with over 2,400 lawyers in over 80 countries. Revenues last year were $440m and there are fantastic opportunities for us to grow these further.’
Brookes said: ‘There are considerable opportunities for us to grow here in the UK and I am delighted to be taking on the role of senior partner.’