Fresh obstacles threaten GT merger

The moves would follow intense disappointment among Kidsons partners over the failure to conclude negotiations with Grant Thornton to merge the two firms in a Pounds 230m deal. Discussions have been underway since the middle of last year but obstacles have so far held a deal at bay.

There is a growing sense among some Grant Thornton staff that the problems with the deal could now prove terminal.

Recent attention among the deal makers has focused on fee differentials and the financial settlement for Kidsons partners.

Grant Thornton generates fees per partner of #665,000 while the Kidsons figure is much lower at Pounds 484,000. Last year Kidsons grew by only 1.5% while the larger firm recorded a respectable 10.1% boost.

The first offer from Grant Thornton included an offer to guarantee Kidsons partners around Pounds 150,000 a year but this was withdrawn causing consternation at the smaller firm.

Problems further holding up the negotiations include what to do with the 15 regional offices of Kidsons that duplicate Grant Thornton bases.

It is understood many, or most, of these would be frozen out of a merger.

Insiders have named the Edinburgh office of Kidsons as one of those seeking a new partner and linked it with BDO Stoy Hayward. But a BDO spokesman said: ‘There are absolutely no plans to merge with Kidsons.’


Grant Thornton faces merger crisis

GT and Kidsons wrangle over merger

Mid-tier merger vote set for January

Kidsons set to merge with Grant Thornton

Related reading