Top execs told City A.M. the world’s biggest professional services firms are seeking to capitalise on the downturn in big M&A deals by poaching talent from investment banks.
Global banks including Goldman Sachs and Credit Suisse have cut hundreds of jobs in London since the start of 2023, in the biggest round of layoffs since the global financial crisis.
The Big Four’s M&A deals advisory units have, however, continued to boom in the slump due to a push for consolidation in the mid-market in which the top accounting firms work.
Fenton Burgin, the head of Deloitte’s M&A advisory unit, said the firm is “actively hiring”. He noted “some of our new joiners have been former investment bankers pivoting into the mid-market M&A space”.
The Deloitte exec explained that while “market volatility” has “put the brakes on mega deals” capital is continuing to flow into the mid-market as companies look to acquire “new technology and expertise through ‘bolt on’ portfolio deals”.
PwC’s deals leader Lucy Stapleton said the accounting giant’s M&A business “is growing, in spite of the downturn in the volume of deals being done”.
In response to City A.M.’s questions on whether PwC is seeking to hire laid off bankers, Stapleton said “we’re always looking to bring in brilliant talent”.
“If there’s talent in the market, we would certainly be interested,” the PwC deals chief said.
She added that PwC is “holding its nerve” by continuing to hire as she said the “mid-market is still very resilient”.
EY’s managing partner Steve Ivermee, told City A.M. the accounting firm is “committed to investing in the talent and skills needed” despite “ongoing economic and geopolitical uncertainty”.
One source in Mazars’ M&A deals business, who preferred to remain anonymous, told City A.M.: “We’re expecting some kind of fallout from the investment banks and we will have our eyes on the market, as everyone does.”
The Mazars source said laid-off bankers might be drawn to the big accountancy firms by the greater “stability” they offer because “don’t hire fast in the boom times but we don’t cull in the weak times.”
Burgin explained laid-off bankers “recognise the benefits of the long-term partnership model, flexible working practices and the variety of different routes” available in the Big Four.
One dealmaker told City A.M. that EY’s forthcoming split had also led some bankers to look at the Big Four more carefully.
EY’s push to separate its audit business from its consulting arm could unlock billions in fees by freeing the firm’s advisory unit from the conflict-of-interest rules that block it from selling advice to audit clients.
“Some are wondering whether they could get into the Big Four early doors and make a killing,” the dealmaker said.
KPMG declined to comment.