PricewaterhouseCoopers and Hewlett-Packard this week confirmed they were in discussions over a possible acquisition of PwC’s global management and information technology consulting practice, writes Philip Smith.
The Californian-based computer manufacturer said in a statement that though terms of the transaction had not been agreed, the deal would be in the $17bn to $18bn range. HP said: ‘The acquisition of the PwC consulting practice would complement HP’s offerings by further strengthening the linkage between business process transformation and technology implementation.’
The talks follow PwC’s decision in February this year to spin off its consultancy arm. Big Five accountancy firms have been under pressure from the US Securities & Exchange Commission to separate their consultancy and audit services to avoid so-called conflicts of interest.
The deal would be HP’s biggest acquisition since Carly Fiorina, its chief executive, took over a year ago.
The move is seen as part of Fiorina’s goal of expanding revenues and regaining market share in the company’s enterprise systems business.
As PwC is HP’s auditor it is likely that the firm will need to resign the engagement as the talks progress in order to satisfy auditor independence requirements.
Any deal would require the approval of PwC’s partners and would be likely to need the consent of the SEC.
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