Deloitte is said to be preparing a sale of its restructuring arm to PR and advisory giant Teneo, marking a further shake-up of Britain’s Big Four audit firms.
Teneo, which is backed by private equity group CVC Capital Partners, is in advanced talks to snap up the Deloitte unit that specialises in business insolvencies, Sky News reported.
Deloitte’s restructuring division is one of the largest in the UK, employing 350 people. It has acted on a string of high-profile insolvencies, including serving as administrator to Sir Philip Green’s retail empire.
The firm has also benefited from an increased number of company voluntary arrangements for ailing high street chains such as New Look and Pizza Express.
It is not clear how much Teneo will pay in the deal, but analysts told the broadcaster it would be valued in the “low hundreds of millions of pounds”.
The deal, which could be announced as early as next week, marks the first major disposal by one of the major UK accountancy firms ahead of a looming industry shake-up.
The government is preparing to publish reforms that will require the Big Four to separate their audit and consultancy arms in a bid to tackle concerns about the quality of auditing and the range of competition in the market.
Deloitte kicked off talks with prospective buyers for its restructuring unit last year as it looked to limit the impact of the upcoming reforms.
The deal is said to be attractive to Teneo as it will allow the New York-based company to expand its business beyond its core communications offering.
Teneo has recently bought a number of smaller restructuring firms, including Goldin Associates in the US and Credo in the UK.
Teneo declined to comment on the report.