The United States consulting firm Alvarez & Marsal (A&M) is embarking on an aggressive expansion strategy by poaching “hundreds” of partners and staff from the Big Four accounting firms, as it seeks to bolster its corporate mergers and acquisitions (M&A) advisory services.
Co-founder Bryan Marsal likened the firm to a “hungry dog outside a butcher’s shop window,” poised to capitalise on the strategic uncertainties affecting its competitors, according to the Financial Times.
A&M is set to announce on Thursday the hiring of six senior deal advisers from KPMG, including Preston Parker, the global head of KPMG’s integration and separation practice. Parker will lead a new A&M business unit focusing on M&A work for both US and multinational companies.
Historically, A&M has concentrated on private equity deals, which constitute nearly 90 per cent of its deal advisory business.
Transactions work represents just over a third of the firm’s operations, with the remaining services centred on restructuring and performance management. With a year-on-year growth exceeding 20 per cent in its fiscal year ending October, A&M is projected to surpass $4 billion in revenue for the first time this year.
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The firm anticipates hiring hundreds of partners and staff from the Big Four and other competitors over the next five years to support Parker’s division, which will handle financial, commercial, and operational due diligence, as well as tax advisory for deals.
Marsal emphasised that A&M’s appeal lies in offering a work environment free from the regulatory scrutiny and conflicts of interest that beset the Big Four’s audit and consulting divisions. Global regulators have intensified their examination of potential conflicts between audit and consulting roles, prompting some industry insiders to question the viability of maintaining both services within a single firm. EY’s recent attempt to split its audit and consulting units stalled due to internal conflicts.
“We find ourselves in a world of massive disruption, and that creates opportunity for us,” Marsal stated. “If I’m a partner [at a Big Four firm], I worry about how that struggle is going to work out. Nothing’s wrong with KPMG, nothing’s wrong with EY. There’s an inherent problem in the industry.”
Parker noted that consultants at Big Four firms are often restricted from working on deals involving audit clients. “If you’re an advisory partner, effectively 25 per cent of the market is no-go for you because of audit relationships, so coming here is like a breath of fresh air.”
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A&M has also successfully recruited from the Big Four beyond the US. Last year, it hired five partners from KPMG in Australia, including the head of private equity, and KPMG’s UK corporate finance head, along with a 40-strong transactions team from EY in China.
Parker described the creation of A&M’s US corporate transactions group as a countercyclical strategy, betting on a strong rebound in the M&A market by 2025. “We have a belief that the transaction markets [will] come back strong in calendar year 2025, and we’re going to be ready to go and ready to rock.”
